At the OCA Convention, Farm Director KC Sheperd spoke with Phil Nichols of the Black Oak Alliance Group about how farmers and ranchers can secure their legacies for the next generation.
Nichols advised that producers must begin with talking with their families about what they want to happen to their assets after their deaths and admitted that it is often the most difficult step. “Communication is so critical, but you have to address a lot of things,” he said. “Many folks aren’t working actively in the operation anymore because they have moved on and begun careers in other areas. So that natural succession plan isn’t an option.”
Nichols laughed as he admitted that his group often serves as arbitrators in such situations at times. “We’ve been doing this for more than 30 years, so over the years, we have learned – the hard way sometimes – how to help get people to open up about these topics. They are hard topics.”
With the understanding that no one wants to talk about the end of life, Nichols said that the responsible thing to ensure your legacy for your family is to have those conversations and review them often as things in life change.
Nichols said that the Black Oak Alliance Group welcomes such conversations as their goal is to ensure the legacy due to the recognition that the farming families, they serve feed, not only the nation but the world.
“With very basic, simple estate planning, you can avoid the public process of probate,” he said. “Your wishes can be lawfully required to be followed.”
He said that in situations where relatives have no intention of running the farm, there are still options to ensure that they get what they want and the farm continues to be productive.
“Leveraging life insurance is a great way to ensure that they are made whole as beneficiaries, and there are a lot of young people who want to get into ag, but don’t have an easy path in to it,” he explained. “Leveraging a very simple financial tool like life insurance can create the monies needed to make your heirs whole as your beneficiaries and transfer that legacy to another individual who wants to do it.”
Nichols said that it is important to make these plans early to be sure you can qualify for life insurance and get it at a more affordable rate.
He said that the most basic step in estate planning is to have a will. He said that a will is necessary for anyone who owns more than a quarter million dollars in assets and for anyone who has minor children. “If you don’t have a will, you don’t get to decide who will raise your babies, if, God forbid, something happens to you. There is nothing more important than that. These are real simple things that can be handled, but people have to take that first step.”
OCA Members can take the first step with Black Oak Alliance Group’s guidance free of charge. They can be accessed at blackoakalliance.com/oca. “There are forms you can fill out and schedule an appointment online, or you can call us anytime. The first consultation is free. We will ask questions to hear what you want to do and what you have, and if you are in good shape, we will tell you, or if we can help you, we will let you know that, too,” Nichols concluded.
