Multigenerational farm retreats get Minnesota families on the same page before it's too late

Jim Molenaar, farmland access and succession teams coordinator for the Minnesota Department of Agriculture, has a line he likes to use when farmers ask him what's the right age to start planning for retirement.

"The day you start farming would be the best day to start planning that you're going to retire from farming," he said.

That planning can include an IRA, which Molenaar said isn't on the radar for most farmers but can really be helpful decades down the road when a source of income is needed.

He said generally, farmers start thinking about transition and succession planning when they're in their 50s.

"Sometimes that's too late," Molenaar said. "If we knew the day we were going to die, it would be a lot easier to plan."

Molenaar spoke on March 22 at the Multigenerational Farm Transition Retreat in Rochester, which was the last of three events to take place in February and March of this year around the state.

The retreats, offered by the Minnesota Department of Agriculture in partnership with the University of Minnesota Extension, and the Southern Agricultural Center for Excellence, are available free of charge to Minnesota farmers considering farm transition or succession plans.

Farmers at the retreats take part in hands-on planning and discussion on farm transition to settle on family and business goals, job responsibilities, financial needs of family members and farm, inheritance considerations and mechanisms of transfer.

Noah Fish / Agweek

Susanne Hinrichs, University of Minnesota Extension Educator, said that all generations actively involved in the farm are encouraged to attend, and stay for both days. She admitted that all the content shared by retreat teachers would be impossible to retain, but the goal-setting amongst families is more important.

"What does it mean to teach, mentor, train the next generation to manage a farm, and then what does it mean to plan for the older generation's retirement?" Hinrichs said. "The whole weekend is really spent building goals for the family, whether it's baby steps or maybe they've already implemented some things and they're coming back to check on what's next."

University of Minnesota Extension has offered workshops on farm transition for over a decade, Hinrichs said, but only since 2018 has there been a partnership between the Department of Agriculture, University of Minnesota Extension and the Southern Agricultural Center for Excellence. The retreat is a collaborative effort where members from all three entities teach.

Molenaar, who was hired to his newly created position in late 2023, faced his own tribulation in farm transition, when in the early '80s, his father died in a farm accident and Molenaar's plan to one day succeed him was cut short when no lender was willing to finance him.

Today, he said it's harder to transition a farm than it was in the '80s. Families are dealing with a lot more acreage and money, with the route to profitability in farming less clear.

"Some of the old time farmers, they'll say, 'I just started out by working hard, and just worked hard and bought a farm, and then worked harder,'" Molennar said. "That's pretty hard to do today. It can be done with an off-farm job, but it's challenging."

Known as the deepest well in the state for farm and succession planning, Molenaar also takes pride in pointing out the overlooked avenues for a farm family to save for the future, like long-term care insurance.

"I love it," he said of his job with the state. "I feel this is really an important need that I've seen in farm families, and I retired from full-time educating farmers to have this be my specific task, and it's very rewarding."

It's also been challenging this winter, as Molenaar was nursing a foot injury while making visits to farms across the state two or three times a week.

"Right now, I've got more on the list than I can get to," said Molennar, whose wife drove him to the retreat in Rochester.

Molenaar said out of the nearly 170 people who came to the retreats this year, many will be back.

"There's just a great deal involved," he said. "It's not just about money. It's family, relationships."

Molenaar is a big believer in Stephen Covey's Time Management Matrix, which is a box divided into four smaller boxes. On top, is urgent and not urgent, and on the side is important and not important.

"On a farm, there is always something urgent and important to do," Molenaar said. "The hay needs to be baled, corn needs to be planted — there's always an urgency and we don't have time to discuss planning."

He said communicating is maybe not in the urgent category, but it's really important.

"The reason why it takes multiple years for people is that they'll come to this program and go home and hay needs to be baled, so it takes time," he said.

On top of that, it's the biggest decision they'll ever have to make.

"It's about finances but it's also about personal relationships, and that can be really complicated," he Molenaar said. "If you have one of your children going to farm and you have several that are not, how do you treat everybody fairly? Is there an equal part, or is there a fairness part? For some, it takes several years to get to where they finalize their plans."

More information on farm transfer and estate planning can be found at extension.umn.edu/business/transfer-and-estate-planning.