Heather Wildman, from Saviour Associates is a specialist in family succession.
For many farming families, the conversation about succession can be a difficult one to have. There are so many different eventualities to prepare for and many are afraid that by talking about it they are tempting fate.
Farm succession expert, Heather Wildman, says that the six D’s farmers need to prepare themselves for are:
It is so important to communicate with your family, somebody must bring up the conversation. The sooner families start these conversations the easier it can be and the more natural it becomes. But some families never have the succession conversation, and then it is too late! There are a number of life events that can trigger the succession conversation. A family member might get married or start a new family. Someone may wish to retire or school-leavers may join the business. Someone could become ill or there could be high levels of conflict or a breakdown in communications.
Before you start you need to know what you want out of your succession plan and you need to know your numbers. Here are a few things to ask yourself:
- Do you know what your spouse or children want?
- How well do you know your business? Whose name is on the bank accounts, property deeds, tenancies, BCMS, single farm payment?
- How exposed are you if something happens to a key member of the family and business?
There are a number of guiding principles to succession. The first is that there is no one size fits all solution; each farming business is different and unique. It is important to obtain quality professional legal and accounting advice. Open communication is key and you have to be able understand and respect the differences in generational values within the family.
For many, succession is just about ‘managing’ tax. This is an important factor and by being open, and planning in advance, tax can be managed. By keeping things in the dark the rest of the family may end up in counselling, therapy, debt or worse!. Agriculture and rural businesses are unique, if the accountant and your professional advisors are not talking your language and do not fully understand your business and your industry, then leave, or ask if there is another partner who does.
There is no right and wrong answer in developing your future plan; the aim is simply to provide the best possible outcome for your family and your farm business and by starting that conversation today you can start to protect your family and your business.
Heather concludes, “If nothing else, COVID-19 has shown us all that life can be short and is precious. We only get one chance at it so how do you want to live your life? What do you want to achieve, and what do you need in place to make it happen? It does not have to be hard or scary, so let’s break down the barriers, achieve our personal goals, and have some fun!”