Estate and Transition
Planning Workshop for
Agricultural Producers
Lessons Learned from Estate and Transition
Planning Workshops
2015 Risk Management Education Conference
April 29, 2015 Bloomington, Minnesota
Jason Johnson and Blake Bennett
Texas A&M AgriLife Extension
Purpose of the Workshop
• Introduction to Estate, Retirement,
and Transition planning issues
relevant to agricultural producers
• Establish an outline of strategies
and procedures to consider when
developing or updating your
Estate/Retirement/Transition plan
2
The Goals for the Workshop
You leave with knowledge and
confidence to assist you to . . . .
• Compile & review your own
information….
• Communicate an outline to your
professional team…. and
• Create or modify a transition /
estate plan that is right for your
circumstances.
3
Participants of the Workshop
•
154 participants attended the Estate and Transition Planning Workshops at
Abilene, Stephenville, Fredericksburg, McKinney, and Waco.
•
Attendees represented 357 family members, partners or shareholders who also
had a working interest in the operation. The aggregated management tenure on
the present farm/ranch by participants was 5,440 Years.
•
87% of Farms/Ranches were individually or family owned; 7% were partnerships,
3% LLC's; 2% Corporations; and 1% Trusts.
•
18% of Farms/Ranches had been in operation for less than 10 years; 24% had
operated for 11 to 29 years; 27% had operated for 30 to 49 years; 31% had been in
operation for over 50 years.
•
Average age of attendee was 64.5 years of age with 4% under 44; 40% between
45 and 64; 36% between 65 and 74; and 20% over age 75.
Property Holdings of Participants
Participants owned/managed 77,970 acres in 58 Texas
counties as well as properties in Oklahoma, Iowa,
and Colorado.
Pre-Workshop Actions/Attitudes
• PRIOR TO ATTENDING THE WORKSHOP:
85% had a Will.
63% had Power of Attorney forms granting permission to act on their behalf.
64% had Medical Directive to Physician documents.
• Most Important Estate Planning Objectives among a list of five alternatives:
31%
23%
21%
20%
5%
Maximize wealth to be passed to heirs.
Keep land holdings intact / preserve the family's agricultural legacy.
Ensure the financial well being of a surviving spouse/family member.
Avoid family strife by distributing property equitably among heirs.
Maintain privacy of personal assets and minimize administration costs.
Estate and Transition Planning
Workshop for Agricultural Producers
Workshop Agenda
•
•
•
•
•
Estate Planning Basics
Lunch and Case Study Discussion
Estate Planning Basics (continued)
Retirement Planning Basics
Transition Planning Basics
On Your Memory Stick
On Your Memory Stick
Workshop Results
•
AS A RESULT OF ATTENDING THE WORKSHOP:
98% indicated they are more familiar with estate planning terminology.
94% indicated they are more likely to communicate their estate plans with family.
89% indicated they know the actions needed to minimize their estate subject to
probate.
98% indicated they understand who should be included in their estate planning team.
98% indicated they know what information they need to compile to discuss estate
planning with their professional team.
78% indicated that they know if they face potential estate/gift tax concerns.
73% indicated that they plan to visit with their attorney to revise/modify their Will
as a result of what they learned at the workshop.
84% indicated that they plan to review their retirement income needs and the
reliance on the farm/ranch to meet them.
54% indicated that they plan to review their (life, Health, Long-Term Care, etc.)
insurance coverage.
Which resources are you most likely to use in
completing or developing your plans?
•
Participants were provided with a workbook, USB memory stick with all presentations and
additional resources, checklists, and worksheets to assist them in completing and
implementing their Estate and Transition Plans.
81%
75%
66%
64%
56%
46%
45%
43%
34%
33%
30%
29%
22%
19%
Estate Plan Checklist
Trust/Will Review Checklist
Transition and Estate Planning Goals Prioritization
Estate Planning Questionnaire
Fair vs. Equitable Treatment of Heirs Exercise
Financial Emergency Preparedness Record Keeping File
Integrated Balance Sheet and Net Worth Worksheet
Farm Transfer Plans Worksheet
Retirement Income and Expenses Worksheet
Transition Plan Goals Clarification Worksheet
Succession Planning Self Assessment
Long Term Care Insurance Assessment Tool
IRA Plan Alternatives Summary
Life Insurance Needs Assessment Worksheet
4 Month Follow up Survey Results
43% response rate of workshop participants
95% indicated that they were making progress in using and
implementing the information gained in their individual plans.
88% of respondents indicated that they were more comfortable about
the status of their estate/transition plans;
88% had taken a detailed inventory of the value of their estate;
85% had reviewed their retirement income needs and sources of
income;
62% had reviewed their insurance coverage;
56% had met or scheduled a meeting with an attorney; and
79% of respondents indicated that they still had some work to do to
complete their estate/transition plans.
Questions on the Mind of Many
Farm Families…
Are we creating a legacy or a
burden by passing the
agricultural operation to our
heirs??
Do we want to pass the family
farm/ranch business to heirs
as an ongoing business or as
a group of assets??
Fair vs. Equal
• Issues of fairness
• Topic best suited for couples/family stakeholders
• Materials/Delivery concessions for Older audiences
(paper and digital formats)
• Circular seating to accommodate discussion
• Multi-sourcing content
• Working Lunch – the power of food
• Role of Extension – objective provider of knowledge
• Potential Partners – drooling to gain access to
participants