The Scenario

You own land composed of agricultural land, but which also has some woods and water (and the highest and best use is continued use of the land as agricultural land and hunting/recreational ground), and you are reaching a time in your life to make decisions on how best to handle your land in the future.

There are many options in today’s world. Some of these could include: sell it for row crop land and the woods/water for hunting/recreation; once sold, complete a 1031 exchange to purchase another income-producing property or retirement home; keep the farm via leasing it out so that you have an income in retirement; work on a succession plan to keep the land in the family; enroll your land in an exclusive ag covenant or conservation easement; build your retirement home or cabin to enjoy your retirement and have a wonderful, memory-filled family retreat to pass on to your heirs…

Considerations to the Above Questions

Are you prepared for retirement; do you need an additional income stream into the future besides other retirement funds; do you want to continue to farm yourself; do you have children who want to farm; do you strongly feel you want your land to continue into perpetuity as ag land or recreational land; do you already have a retirement home; do you have funds and time to build and enjoy a family retreat that can be passed on to the next generation?

Starting Points

When the future of your land is in question, an appraisal or broker price opinion will provide an opinion of the worth of your land. This factor alone may assist in helping you answer some of the above questions. You may decide, based on the number of children you have, the number of acres of land and rent or income from that land, there may not be enough income to divide between the number of children and you will sell the land. Or, on the reverse side, you may decide, depending on the number of children and the amount of agricultural land, there would be enough income to warrant keeping the land in the family. Then, are there children who are interested in farming or not. If yes, succession planning can be handled and there are a number of extension offices, attorneys, etc. who can assist with succession planning. If there are no children interested in farming, a professional farm manager could assist the children in managing the farm.

Should you decide to enroll the land into an ag covenant or conservation easement, a professional and experienced land specialist can assist in locating the appropriate agency/entity. In deciding whether to add a family retreat to your land, the question again is dependent on your financial situation, your age, the number of children/grandchildren you have, and so on.

Conclusion

Your land is probably your largest asset and determining what’s right for you involves tough questions. Land professionals in real estate, auction, appraisal, and farm management can assist during the many phases of your farming operation, including assistance in working with you through all of the above considerations. Please feel free to call, text or email me if you have questions regarding your land situation. My objective is to assist you in reaching your goals and expectations.