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Transition Planning Strategies CENTRA Training – May 14, 2013

Transition Planning Strategies CENTRA Training – May 14, 2013. Outline. Elements Tools Barriers Conclusions. Why should I care?. Founding Generation. 30%. Second Generation. 12%. Third Generation. 3%. Fourth Generation.

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Transition Planning Strategies CENTRA Training – May 14, 2013

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  1. Transition Planning StrategiesCENTRA Training – May 14, 2013

  2. Outline • Elements • Tools • Barriers • Conclusions

  3. Why should I care? Founding Generation 30% Second Generation 12% Third Generation 3% Fourth Generation

  4. Iowa Farmland Ownership by AgeSource: Iowa State University Extension (Duffy and Smith, 2008) 55%

  5. Challenges for the Aging Farm Owner

  6. Perspectives for the closely-held farm business Family Business Legacy Assets

  7. Why should I care?

  8. Why should I care? 3x to 4x Poverty rate of widows compared to same-age married women

  9. Why should I care? 55% Percentage of U.S. adults with no estate plan in place

  10. Elements of Transition Founder Successor

  11. Elements of Transition Founder On-farm heir Off-farm heir Separate Entity Unrelated Successor Ownership Control Liquidation / Dissolution Participation

  12. Elements of Transition Founder On-farm heir Off-farm heir Separate Entity Unrelated Successor Ownership Control Liquidation / Dissolution Participation

  13. Elements of Transition Founder On-farm heir Off-farm heir Separate Entity Unrelated Successor Ownership Control Liquidation / Dissolution Participation

  14. Estate Tools

  15. Estate Tools - Others

  16. Ownership Tools

  17. Business Entities

  18. Business Entities

  19. Transactional Tools

  20. Barriers to Implementation • Communication • Equitable considerations • Farm kid / city kid • Sweat equity • Willingness to transfer

  21. Conclusions • Producers, we can transfer it. We have the technology. • Do producers and professionals understand the tools and their impacts? • Are producers willing to engage in true transitions?

  22. THANKS! Dr. Shannon L. Ferrell OSU Department of Agricultural Economics shannon.l.ferrell@okstate.edu

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