After 35 years of experience selling farmland, Rick Barnes of Barnes Realty noticed a common problem: When both parents are gone, the kids promptly start fighting about the family farm and everything else.
It is the last thing any parent would want to happen. Lawyers make a lot of money, and the family is broken forever.
Although some problems may be inevitable, you can make decisions now that will make the transitions go smoothly and help avoid a family split after you’re gone.
Most of the elderly don’t want to make decisions that they know will anger some of their children.
“But the assets are yours and you and your spouse worked all your life to put it together,” Barnes said. “You need to make the decisions on how your stuff gets divided.”
One of the things Barnes suggests on managing the future of the family farm and other assets is avoiding undivided fractional interests like it was poison. Maybe 10 percent of undivided deals work for the children and almost none of them work for the grandchildren.
“You know your kids,” Barnes said. “You know who needs the most help, who treats you the best, etc. Satisfy yourselves and don’t worry about what your kids think. Make up a list of who gets what.”
Keep it simple. Notes on a legal pad works.
“After putting your heads together to draft a preliminary list, I would suggest meeting with a financial planner,” Barnes said.
If you own more than a few hundred acres, Barnes added, you might be amazed at the net worth of your estate. Probate fees at your passing are something every landowner needs to plan around.
“Larger estate holders may need to plan to minimize federal estate taxes,” Barnes said. “There are many details that I won’t delve into here, but that’s why you should talk this over with someone who is knowledgeable and qualified. It’s too important to skip if you’ve got a lot of farmland or other non-cash holdings.”
In the interest of being fair to your children, now is the time to talk to someone who can assist you with the value of each tract.
Once you get a breakdown of the value of the various assets, you can figure out how to make the division.
If the family is close and there are no major internal feuds, get everyone together, go over the proposed plan and see what they all say. Give everyone a chance to voice their opinion, listen carefully and then decide who gets what.
“That way,” Barnes said, “when you are gone and it is time to divide everything up, some of them might be mad at you, but not at each other. To repeat, it’s your property and you decide what to do with it. Not the kids.”
If you’d like to talk to Rick Barnes personally, feel free to call him at 660-851-1152.
“I feel so passionate about this topic that I have added a team member at Barnes Realty that specializes in guiding farm-owning families through this planning process,” Barnes said.
“Over the past 35 years, I’ve seen many situations where a little advanced planning on mom and dad’s part could have prevented many years of bitter sibling relationships. Don’t let that happen to your family. Make the decisions today to make your family’s future possible.”
Locations: 18156 Highway 59, Mound City, Mo., 64470; 1711 Oregon St., Hiawatha, Kan., 66434, and 1708 Prairie View Road, Suite B, Platte City, Mo., 64079.
Contact: Mound City office at 660-442-3177, Hiawatha office at 785-742-4580, Platte City office at 816-219-3010.