Succession Planning
Succession planning involves the transfer of leadership, managerial control and ownership of farming assets from one generation to the next. It is the development of a plan that will allow a smooth transition of the business and any assets with the aim to minimise disruption to the business and, more importantly, to family relationships.
Succession planning is often a very complex issue for farm businesses and there are as many solutions to succession planning as there are farming families. However, a well-planned, structured and inclusive plan created by all members of the family in consultation with a lawyer and a financial advisor, will ensure the risk of disputes are minimised, family relationships protected, control is passed on smoothly and seamlessly, and will, in all likelihood, positively contribute to the success of the farming business.
There are three, equally important, parts of the succession process
Important points to consider when creating an effective succession plan
When to start succession planning
A 2016 study conducted by Chapman Eastway and Charles Sturt University concluded that many farmers find the options available to fund retirement are limited if they leave planning too late. This usually occurs because of an under-estimation of the ease of which sufficient funds can be accessed, given tax implications of withdrawing farm income.
Therefore, it’s never too soon to start succession planning. You could start as soon as the farm is passed into your hands, when your children are teenagers or when you are considering retiring. The sooner, the better. Just remember….
You have got to start the planning process knowing that plans are always changeable, and you are ready to change with them.
To get started on your planning today, contact us on (02) 6977 1155 or send us an enquiry TODAY