Steve Kerby

Oregon Financial Group

The “Graying” Of America’s Ranchers And Farmers Highlights The Need For Retirement Planning.

"Between 1992-2012, an area of ranch and farmland the size of the state of New York went out of production. One of the reasons was a lack of retirement and succession planning."- Steve Kerby.

America faces a demographic crisis threatening to upend our financial, healthcare, and retirement systems. By 2030, it's projected that 1 in 5 Americans will be age 65 or older. In rural areas, the issue of an aging population takes on particular significance because rural residents tend to be older than the average urban dweller. For example, the average age of a farmer or rancher in the United States is nearly 60, meaning retirement planning is becoming a critical issue.

Retirement planning of any kind is challenging, given our current unpredictable economic environment. However, if you work the land as a farmer or rancher, your retirement faces additional challenges. For instance, because ranching and farming are businesses, other issues may complicate planning a successful retirement. Also, farms and ranches tend to be closely tied to a family's history and community identity, making retirement a more intense and emotional discussion.

Although some ranchers and farmers look forward to the day when they no longer work from sunrise to sunset, others face rough transitions because they do not have viable succession plans in place. If you or someone in your family is involved in ranching or farming, you need to understand the products, services, tools, and techniques that make for a smoother, less stressful transition into the next phase of your life. Here are some fundamental concepts to help you start envisioning the hows, why's, and when's of your dream retirement.

Estate planning is critical.

Estate planning is not something you "set and forget"; it's an ongoing process. As I mentioned, most American farmers and ranchers do not have written estate plans. An even more significant number have no formal transition plans in place. Solid estate planning for any farmer or rancher helps guarantee that your assets create enough income for you to maintain your lifestyle during retirement. The second goal of estate planning is ensuring that your assets pass to the intended beneficiaries when you die. A well-designed estate plan can also help reduce a transition's fees, taxes, and court costs.

Be sure to create a power of attorney.

There may come a time in your life when you can no longer manage your finances, healthcare, or other personal affairs. This is why you must have a power of attorney, granting legal authority to a designated person who can then make specific decisions on your behalf. You may be familiar with a healthcare power of attorney, which lets you name a trusted person to make medical decisions for you when you cannot. Financial powers of attorney let you name someone to act as your agent in financial and legal matters.

Why your property ownership matters.

Like other kinds of property, ranches and farms can be held in various ways. Each ownership type transfers differently. Ranches and farms are typically sole ownerships, joint tenancies, tenancies in common, or life estates. Each of these ownership structures has its own unique rules and protocols. You should have a qualified estate planning attorney or other financial professionals examine how your property is owned and discuss the implications that particular kind of ownership has for retirement.

Bottom line: If you are a rancher or farmer, you must take retirement planning seriously to ensure your legacy remains intact. Whether you want your properties to pass to heirs or you decide to sell or rent, having an estate and succession plan will help you make a more satisfying and smooth transition.

Steve Kerby picture

Steve Kerby

Oregon Financial Group

5555 SW 196th Ave.

Aloha, Oregon 97078

(503) 936-3535

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