Farm succession plan road map for the future

By Heather Cameron
Taber Times
Local Journalism Initiative Reporter

Farm Succession Planning is essential.

“Farm Succession Planning is an ongoing process to prepare the next generation to become the owners, managers and decision makers on the farm in the future,” said Nick Oakley, Business Development Lead for Farm Management Canada. 

A farm succession plan, Oakley says, is the roadmap for the transfer of knowledge, responsibilities and ownership to the next generation, and outlines how each aspect of the business will be impacted by the transition process and provides details on the timelines in which they will happen.

“There are many components to a farm succession plan,” said Oakey. “You need to account for each aspect of your operation and how it will be impacted by the transition process. It’s also crucial to look at estate planning, tax planning and any legal documents or agreements that need to be implemented.

Oakley explains that the actual process of creating a farm succession plan can be very long and intricate, so it’s important to bring together your farm family for discussions and to get on the same page, and a farm transition advisor can play an important role in ensuring all voices are heard and the succession process continued, and it’s also important to write down ideas, thoughts and concerns to ensure there is a documented account on what is said and decided upon.

“I feel it’s important for all stakeholders to be involved in or aware of the plan and the planning process. This would include farming and non-farming children, all owners and managers too,” said Oakley. “It’s equally important to surround yourself with the right team of professionals to help navigate the process as well. This could mean accountants, lenders, transition advisors, lawyers or anyone else who can provide advice along the way.”

Those who can provide help in the process, Oakley says, include farm transition specialists and there are many incredible farm transition specialists in Canada and a lot of great resources to help farms begin or continue the succession or transition process. One of the many resources out there, Oakley says, are Bridging the Gap Workshops and they are a great opportunity for farm families to come together and learn together about some key elements to farm transition and become better equipped for the process, and Farmtransitionguide.ca is another great resource to find help or information.

Oakley says that over the next eight months, Farm Management Canada will be hosting seven Bridging the Gap Workshops across Canada, including three in Alberta, with the help of dedicated partners. The Bridging the Gap Workshops, Oakley says, are one of the best ways to directly reach producers and provide both the current and next generation with learning opportunities, resources and support to positively impact their farm successions planning. More information about the workshops can be found at: https://fmc-gac.com/programs-services/btg/, Oakey says.

“Each plan needs to be designed specifically for each individual farm,” said Oakley. “Unfortunately, there is no cookie cutter approach. While there are many intrinsic values that all farmers share, each situation has unique components, relationships and past experiences that make them all different.  Ensure your plan considers all aspects of your operation and makes sense for both the incoming and outgoing generations. Seeking the support or advice of an expert is something that farmers frequently do when it comes to crops, livestock, taxes and lending. Make sure you do the same when it comes to your transition and the future of your farm.”

Oakley says that Farm Management Canada also spearheads Farm Transition Appreciation Day, which happens every January and was initially created to promote farm transition education and to encourage farmers to start the transition process. Many incredible partners have joined #FTADay to deliver learning opportunities for producers and help them through the process, Oakley says.

“The best thing you can do is get started. Start the conversation with all stakeholders and you’ll begin to see some potential paths forward,” said Oakley. “A farm transition plan is likely to change or grow as your family and business does, but continually thinking about and talking about transition is the best way to begin and continue the farm transition process.”

Oakley emphasizes that the next generation is often ready to start planning their lives and want some clarity on when they will begin to gain more responsibilities and be able to make important farm decisions, and they are excited, willing and able to take the lead and guide the farm forward.

“Encouraging the older generation to begin to have these conversations can be difficult at times, leading to some frustrations and family conflicts,” said Oakley. “Receiving the proper education and support to overcome some of these challenges is key to seeing a transition process through. Farm transition or succession planning is vitally important to the future of your farm. It’s not going to be under your ownership or control forever, so you must work to prepare yourself and your operation for the next generation to take over. Looking at these plans early will give you the best opportunities to position your farm for the future.”

Oakley says that there will come a day when the farm needs to be passed on to a new generation, and that day is inevitable.

“The only thing within our control is “are we going to be ready for it or not?” said Oakley. “While the planning process can be long and at times difficult, the alternative is having your family sort out your estate and the future of the farm, with no preparation, once you pass. These are the moments when relationships are severed, farms are dissolved and your family ceases to function as it once did. You can’t skip seeding and fertilizing your field and still expect it to produce a crop. The same can be said about your farm transition: you can’t avoid planning and sorting out the transition plan and still expect it to produce a fruitful result. We have seen many common experiences across the country over the last few years. Older farmers are struggling to find the right time to start thinking about succession out of a fear that they may lose their identify or their purpose will become unclear. It’s really comforting for them to hear that transitioning from the farm doesn’t mean you have to retire and not be seen or heard from again. The brilliant farm management consultant, Dick Wittman described it as “Getting out of the way, without going away”. Often, you can still be around for mentorship, for guidance and for all-around support. Transitioning your farm properly will work towards ensuring that the right structure for the farm can be realized and agreed upon. Farming is unlike any other industry, because family life is so closely linked to farming life. I can’t think of any other industry where it’s common to have many generations live and work on the same property. It’s truly a way of life. These close family ties to the operation mean that when it’s time to think about transition, many extra layers of emotions can be tied in as well. Farmers are so passionate and proud of the work that they do, and they want to ensure their legacy, and their family legacy will continue for years to come. Working with them to ensure successful transitions take place is incredibly rewarding and important.”