By Myron Friesen
La Nina or El Nino, I sometimes can’t remember what the terms means but I do know that predictions are made based on weather patterns and cycles.
They ultimately become a whole set of circumstances that collectively can be a factor in the weather or at least someone thinks so. For me it is easier to understand the circumstances that may lead to a tornado. I know that when we have had a hot, sticky day and the clouds are rolling I get that feeling that there a storm is brewing somewhere.
As the clouds thicken, people say to each other "somebody is going to get it tonight.’’ We just have that sense in our body that the conditions are perfect for a storm.
A couple years ago one of those days "had that feel." An office assistant from another part of the country had never been in the tornado environment and she didn’t know the "feel."
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A short time later I looked out the office window and there was a twister about 5 miles away in perfect view. In some situations I would rather not be right, but at least I was aware that a tornado could be around. Fortunately, the tornado skipped around and didn’t harm anyone.
A short time later I looked out the office window and there was a twister about 5 miles away in perfect view. In some situations I would rather not be right, but at least I was aware that a tornado could be around. Fortunately, the tornado skipped around and didn’t harm anyone.
I have a feeling that we have a perfect storm brewing in agriculture. Many farmers have their best-looking balance sheets in years and have good anticipated cash flow. Constant attention is being given to land prices and commodity prices. Off-farm heirs’ interest in farm land is peaking. Every week the media brings some sort of attention to farm values.
Memories of past farm struggles are forgotten by those who see the dollar signs. Machinery is being purchased and built on demand only. Wills and legal documents seldom address farm continuation in a realistic way. Two-thirds of land is owned by those over 60.
Excess dollars are being leveraged to expand with little thought given to preserving the existing farm. Whoa… are you feeling a storm coming?
It will be like a tidal wave rolling across the Midwest. Something we haven’t experienced before that could change things significantly in the future.
The good news is that at least some farmers are starting to recognize the issues. The bad news is there is still little being done to proactively address the issues. How will the storm be weathered?
When bad weather hits damage is minimized by those who have heeded the warnings and have taken measures to protect themselves. At the same time those who are most critically injured are those who are standing outside watching the storm, unprotected and not obeying the warnings.
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Are you going to stand outside and get washed up by the wave or are you going to listen to the warnings? The warnings will only last so long and then the lessons will become harsh.
With weather, many things have to do with cycles and patterns and probabilities or chances of certain things happening. The possible chance of rain or snow or sunshine are simply a predictions based on cycles and patterns. However, very few things in life can be predicted with 100 percent certainty.
How is estate planning any different?
With a person’s estate one thing can be predicted with 100 percent certainty… you will die. The question is when and why, but even then, it’s not as important as the fact that you recognize that you will die. When I hear rain or snow predicted at a 20 percent or 30 percent chance, I don’t pay much attention. However, when I hear a prediction of a 100 percent chance it seems pretty certain.
If I was finishing field work I would probably stay out late to make sure it was done if rain chances the next day were 100 percent.
If I knew with 100 percent certainty what the markets were going to do, I’m certain that I would plan accordingly and sell at the highs.
I often hear comments like, "if we had only known" or "in hindsight", or "hindsight is 20/20."
You know what? Sometimes I get tired of hearing about hindsight and wish we used a little more foresight. Maybe the combination of hindsight and foresight would be the best. Hindsight can show us all the ingredients to the storm are in place. Foresight can show us that death is 100 percent certain.
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If you combine the two, it should lead every farm estate to proactive farm continuation planning. Are you listening to the warning signals?
Myron Friesen is a co-owner of Farm Financial Strategies in Osage, Iowa. For more information, contact him at 1-866-524-3636.
