If your idea of communication is shouting at your wife (or kids) to close the gate, or when a son or daughter approaches you with “We've got to talk,” you immediately wonder what law they've broken, it might be time to focus on honing your communication skills.

“Communication is difficult when it's around a very passionate, emotional issue,” says Claire Birkeland, a Minnesota-based psychologist who specializes in systems therapy.

That's why she recommends families begin the estate-planning process with the simple question, “What does the farm mean to you?” Though the step may seem small, it helps everyone begin to share their feelings.

As a result, people begin to identify their roles in the family business. Some may want to continue in the business, others might want out.

Next, she recommends all involved sit down and write out what they want to do, what's important to them, and what affects their bottom line, keeping in mind there are no right or wrong answers.

At this point, families are thinking and talking about estate planning and determining what they'd each like to happen. Once this starts happening, someone outside of the family can step in and lend a hand in the process.

“It's awkward to say, ‘This is what's going to happen to my assets when I die,’ but it needs to be done,” Dave Baker, a farm transition specialist with Iowa State University's Beginning Farmer Center in Urbandale, says.

As a mediator in the estate-planning process, Baker begins by having families, and the individuals involved, identify their values — what they hold dear. Such an exchange provides a platform for families to begin shaping their vision for the future of the business, or a chance to buy into that vision if it's already established.

“What are we trying to do?” is a question Baker often asks families in an attempt to develop a mission. “Are we trying to transfer a business?”

If transfer is the mission, then goal setting and strategy development come next. During this time, other resources such as articles, outside ideas, or personnel may need to be brought in to aid the planning effort.

Handing over the reins

Start early, Birkeland suggests. The process of talking about the future of the farm actually begins during “individuation” — the time when children are differentiating themselves from each other.

Parents help out with this by asking, “What do you want to be when you grow up?” or “Where do you want to go to college?” Children bring it up by asking such questions as, “What is the future of the farm?”

“The sooner you can talk about it, the more natural it becomes,” Birkeland says.

While it's good to start talking about plans for the future at an early age, true transitioning of management and assets starts later in life. Baker suggests beginning 5-10 years before the controlling generation's complete retirement.

“A big part of our program deals with the older generation being a mentor to the younger generation,” Baker explains. “They're going to teach that young person the ropes, teach them how they've been successful.”

It's a process of handing over the management reins. Instead of being thrown into full decision-making right away, which often occurs due to health problems, try to ease into management over a four- to five-year period.

“Children become better managers knowing their mentors are there from time to time to look over their shoulder to make sure no major mistakes are made,” Baker says.

Baker sees two options for folks ready to retire. The first is to sell everything and get out, putting the money in the bank. What you get is a fixed income with a 1-2% growth in a bank account.

The second is to start a new family in agriculture, generating 12-15% in returns, sharing the business with another family and leaving part of your legacy.

Starting a new family, whether it be a relative or not, has a ripple effect beyond your operation. It affects the community, as well.

“Someday you're going to have a eulogy,” Baker explains, “and they'll talk about how you started young families and what it meant to the community, church, school and businesses in town.”

However, there are times when the older generation doesn't want to give up control. After all, there are twice as many farmers over the age of 65 as under the age of 35. And did you know that half of agricultural land is owned by folks older than 75?

Giving up the reins can be a big change for the older generation, Baker says. “They're not treating it as a business; they're treating it as their farm, their life. Can you imagine giving up your life?”

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