Income tax is a huge cost on any farming operation, because as farmers we can't depreciate land purchases.
Since tax season is coming up, it’s time to talk about some of the best income tax management strategies for farmers. Here are three of the best.
Every truly successful person I've ever meet or read about has a hobby that provides him or her with escapism. The opportunity to escape somewhere at some time in our daily lives to free our mind and improve personal happiness is so important to obtaining and sustaining success.
In this episode, we discuss a few healthy ways to escape our professional life so you can ultimately be more successful.
It’s always a challenge to value real estate, especially when it comes to farmland.
After reading Paul Moore's book The Perfect Investment, my perspective on valuing real estate at a professional and investment level was changed dramatically.
So many farmers only think about the dollar per acre amount and not what Paul talks about in his book: “cap rate.” Today we’re going to unpack cap rate and how that makes a difference when you’re valuing real estate. You’ll learn how you can put a number all the real estate values that you operate on your farm.
Patrick Montgomery went from U.S. Special Forces Army Ranger to cattle rancher in the span of a few short months.
His story is unlikely, but inspiring. I had the privilege of interviewing him and hearing his story in this episode.
Let’s set the stage: you’re a farmer with a can-do attitude, but unfortunately you’re on the brink of having to give up the farm. Your main operation just isn’t making what you need.
But there’s a wonderful reality working in your favor: there are people out there who aren’t like you. In fact, they will pay you to do certain work for them in more places than just the farm. This extra work just might help you keep the farm.
This episode is an interview with Matt Brechwald, co-host of the Off Farm Income Podcast, about what that extra work might look like for you. Today, we’re going to go over seven sources of off farm income.
At least on paper (though that may not translate to cash), farmers are wealthy. Many are understandably concerned about passing those assets down and not having the next generation ruin the business. Some don’t even let their kids make business decisions until they’re almost completely out of the picture, which might not be until they’re in their 80s.
There are two really good stories from The Richest Man in Babylon that deal with the concept of inheritance. I think they hold a lot of wisdom for farmers and landowners today.
One thing is clear in my conversations with farmers: the biggest challenge they face is making their debt payments.
Part three of our series on the financial principles of ancient Babylon pulls from The Richest Man in Babylon. Today’s lesson is about managing your debt and working with the holders of your debt to have a realistic plan in place.
One weekend, my son and I went to Minneapolis, and I had him listen to The Richest Man in Babylon. I wanted him to hear it, since it’s had such an impact on me.
Then I found that the one listen wasn’t enough for me. I listened to it again the next day after our trip, and I couldn’t help thinking about how much rich wisdom it held.
It’s especially helpful for where farming’s at right now, when things are tight and stress is high. I just had to share what I’ve learned with you.
The Richest Man in Babylon is one of my favorite books of all time. It’s so good, I read it twice in one weekend.
Babylon was one of the wealthiest cities of ancient times, because of the financial principles of its people. They recorded stories and fables with these lessons on clay tablets which were unearthed not too long ago. Those tablets are the foundation for the several stories that make up The Richest Man in Babylon.
One of my favorite principles from the book is the one we’ll be discussing today: seven cures for a lean purse.
The Mongol dynasty made Alexander the Great’s look pitiful. Genghis Khan reorganized the world: he connected China to the west and developed gunpowder. For around 100 years in the 12th and 13th centuries the Mongols dominated from Italy to China, to Russia, to India, to Turkey—basically most of the known world.
Granted, Genghis Kahn was about the worst human being you can imagine. He would go into a city and kill everyone if they didn’t cooperate.
But on strategy alone, there’s a lot for farmers to learn from Genghis Khan and the Mongols.
John Templeton is one of the most famed investors of all time.
This is a guy who in 1939 bought $100 worth of all stocks traded under $1, and by 1943 he had four times his money. He’s up there with the greats.
His strategies, and the way he built his wealth, were so brilliant that I think there are a lot of key values and structures that we could apply to our farming operation to help us be more consistent, profitable, and smart.
In this episode, Scott shares 7 strategies you can use to farm like John Templeton.
On some commodities, we’ve hit some pretty interesting times. This is especially true with wheat.
Sometimes we just have to be patient for something bad to happen to put prices up. In the meantime, I want to talk about two programs that are essential to a farmer’s cash flow through a tough time like this, if they don’t have the grain sold in advance.
We’re getting close to harvest time. By the time this goes live, we might even be in it.
It’s important to think about where commodity prices are right now and what to do with grain that you haven’t sold.
So I want to put together a few things for farmers to think about when it comes to storing grain.
John DeLorean was a designer at GM who wanted to produce futuristic cars. He was convinced that the culture of order and structure at GM was holding back creative geniuses like himself.
Since he was a very good salesman, he felt confident in his ability to forge his own path in business. So he walked away from his job at GM in order to produce his brand of futuristic cars.
He failed miserably.
When I talk to farmers, a lot of the same issues from the John DeLorean story arise. They fail to manage themselves and are often making gut decisions rather than logical and planned decisions.
Trust me: there’s a better plan to follow.
In my mind I have a job, separate from my farming operation.
It goes something like this: learn as much as I can, try to relate it to farming, and write or share content that relates to farmers.
That’s what I did with the most recent Tony Robbins documentary. I’m a big Tony Robbins fan; he’s helped over 50 million people, and he’s a pretty amazing guy. When I watched the documentary, I learned something that I think is relevant to farmers and grain marketing today—fear is our biggest problem.
In this episode, I discuss how you can do more than eliminate your fear of grain marketing—you can actually turn it into a beautiful experience.
Is ag retail the enemy?
The really depends on what you mean.
I had the pleasure of recently interviewing Andy Wuebben, partner at Vertical Exchange, in this episode. Andy helped answer that all-important question.
Something like 90% of businesses fail within the first two years. The main reasons? Structure, strategy, and accountability.
When you’ve got millions of shareholders you have to report to (like Apple, for example), Wall Street analysts break down your company and try to out-predict you, and you’re on a whole other level of business. Most small businesses don’t have that same pressure to perform, though, which can be both good and bad.
With my background on Wall Street, helping businesses raise money from investors, I’ve learned a lot of strategies that Fortune 500 companies use. Today, we’re going to apply those to the common farm.
A few months ago Scott spent five days in Ukraine—a spur-of-the-moment trip.
He visited a company called Agro-Soyuz in eastern Ukraine, not too far off from where the war’s going on with Russia.
He learned a lot about their company. But he also learned a bunch of things that made him want to come back and kiss his American soil.
It's tough to find good help, isn’t it?
Scott’s made a lot of mistakes hiring farm workers, from hiring really close friends to not properly interviewing people, to not setting expectations.
But successful hiring is extremely important, especially in something like farming, where a small group of people are doing complicated, stressful work in an outdoor setting.
In this episode, Scott discusses three things that help with hiring the right people on the farm.
Scott does his farming over here in the Dakotas, and sometimes this podcast is guilty of focusing only on the type of farming that happens out that way. But of course, there’s a whole country (and world) of farming out there.
So today we’re going to be focusing on some of the hot farming topics in the state of California. This episode is an interview with Vaughn Brenda and Jeffrey Chapman from Valley Farms Supply and Fence Post Ag.
In most categories of life, there’s that one elite group.
In business, there’s the Fortune 500. In the military, there are the Navy Seals.
Scott just read a book called Unbeatable Mind by Mark Divine, who was not only a Navy Seal, but graduated as the top Navy Seal—which is insane. In the book, he teaches how to become what you want to be in life. All entrepreneurs—farmers included—should have an understanding of the mental state and conditioning he teaches in the book.
Specifically, there are four skills Scott learned that will help you farm like a Navy Seal.
If you’re in farming for the money . . . it’s gonna be a tough life for ya.
However, there is a lot of money to be made when you’re really good at it. The worst markets provide the best opportunities.
In this episode Scott shares six ways you can strategically grow your farm—even during the hard times.
The hardest part of farming by far is navigating the grain markets and making grain sales.
At the end of the day, "Bulls make money, bears make money, but pigs get slaughtered." Choose a side—if you don’t, you’ll be making one of these three critical grain marketing mistakes.
Capital is the lifeblood of business.
A business can't grow without access to capital through debt and equity. Most farms grow and prosper through partnerships with banks and their own wealth, built up over time.
Use the strategies in this episode to improve your working capital position on the farm.
Farmers have mixed perspectives on grain bins.
So many bins have actually cost farmers money, allowing them to make bad decisions in their marketing.
But those big tin cans should actually be huge profit centers for the farmer, if used properly. In this episode, Scott tells you exactly how to use grain bins to gain the maximum profit.