Document Type

Circular

Publication Date

6-1958

Department

Economics Department

Circular Number

142

Keywords

father son partnership, farm partnership, farm inheritance, getting started in farming

Description

Almost one-third of the farmers in South Dakota in 1954 were over 55 years of age, according to the U. S. Agricultural Census. Many farmers find it advantageous to retire from actual farming and rent out their farms at age 65, in order to qualify for Social Security benefits. This means that a large number of new farm operators are needed each year. At the same time, thousands of farm boys are confronted with the task of selecting their life work. Many would like to farm, but are wondering how they can ever raise the capital required. The day is past when a young man needed little more than a team of horses, a plow, and a wagon to begin as a farm renter. Today, unless he has machinery and livestock worth well into five figures, he is apt to have a hard time succeeding. The problem of getting the new operator established is currently being met by many farm families through father and son farm partnership agreements. Such agreements are making it possible for the son who wants to farm to gradually buy his way into the farm business, so that he will be in a position to take over when his father retires. Where there is no son who is interested in farming, often a son-in-law is taken into the business. There are also instances where an unrelated young man has been taken in as a partner. In any case, most of the time both partners benefit from a partnership arrangement. The combination of an established farm business, the experience and wisdom of the senior partner, and the ambition and energy of the junior partner generally makes for a profitable enterprise. The older man can accumulate funds for retirement at the same time that the young man acquires equity in the capital needed to operate the farm. Starting a farm partnership involves a number of important considerations, both personal and economic. The purpose of this circular is to help farm families in setting up workable father-son agreements. It attempts first of all to outline the basic requirements for successful partnerships, and secondly to provide suggestions to assist in working out satisfactory arrangements.

Pages

20

Format

application/pdf

Type

text

Language

en

Publisher

South Dakota State State College of Agriculture and Mechanic Arts, Agricultural Experiment Station

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