Four Things to Remember for a Successful Farm Succession

Four Things to Remember for a Successful Farm Succession

Farming as a profession is unique in the way it places “overwhelming significance on lifestyle over profit.”1 Where the ability to function without a founder is testament to the strength and value of small or medium size businesses, a successful family farm is often made stronger by the full participation, sometimes for generations, of an entire family.

Farming can be as much a way of life as it is a way of making a living. For those men and women whose senses of self are informed by being a farmer, thinking about transitioning into retirement and determining a successor is no small feat. But, like every other Canadian business owner, farmers need a clear succession plan in place if they want to give their farm the best chance at surviving into the next generation.   

The 2016 Census for Agriculture anticipates that while “three out of every four Canadian farms will change hands in the next decade – that’s approximately $50 billion in farm assets – fewer than 10% of farmers have a transition plan.” This is an alarming statistic given that those farms without one “have a 66% chance of failure.”2

Whether you are just getting started or are well into farm succession planning, here are four things to consider.

Start Early

Ideally, a farmer should be thinking about the transition process years in advance of actual retirement. On average, “a full farm succession takes [about] eight years.”3 If children are involved in running the farm, starting to plan early will give a farmer time to teach best practices, establish specific roles and responsibilities, and involve them in the different day to day aspects of running a business. The more time a farmer has to plan – and involve their family in planning – the more valuable their biggest asset will be when it comes time to transition or sell.

Be Realistic

When children are involved in operating the farm, it can become clear that some are more invested in the business than others. For parents, it can be tempting to assume asuccessor based on a child’s work ethic and personality however, doing so can lead to all sorts of internal and external conflict for everyone involved. Having periodic, open conversations as a family will give both parents and children time to reconcile their visions for the future and be realistic about whether transitioning within the family is something worth seriously considering or if they should anticipate selling to an outside party.

Seek Professional Advice

Did you know an individual who owns farm property (land or building), an interest in a family farm partnership, or shares in a family farm corporation may be able to claim a $1,000,000 lifetime capital gains exemption (LCGE) when the farm property is sold?  The actual capital gains deduction is 50% of the capital gains exemption.

The 2015 Federal Budget increased the maximum Lifetime Capital Gains Exemption (LCGE) for qualified farm property dispositions on or after April 21, 2015 to the greater of:

  • $1 million; and
  • The indexed Lifetime Capital Gains Exemption applicable to capital gains realized on the disposition of qualified small business corporation shares.

This means that once the LCGE exceeds $1 million for Small Business Corporation (SBC) shares through indexation, the LCGE for farm property will be the same as the LCGE for SBC shares. 4

Part of creating a strong succession plan means keeping abreast of tax provisions and benefits. Seeking professional guidance from key advisors – financial planners, accountants, lawyers, etc. – will ensure your plan is tailored toward maximizing business value and actualizing your plans for the future.

Equity Not Equality

Inheritance is a common point of contention in farming families with multiple children. When only one child is set to inherit the farm operation, parents often struggle with the notion of equality – “what can we leave our other children so they don’t feel lesser?” In these kinds of situations, it is necessary to aim for fairness, not equality.

A farmer’s greatest asset is his or her farm so naturally, there will be an imbalance when passing it down to only one child. Explore how other options, like life insurance, might help mitigate inequalities between children.Ultimately, open communication early on helps to establish expectations and mitigate potential surprises down the road.

Like any other Canadian business owner, farmers need a succession plan to ensure the continuation of the farms they and their families have spent decades – sometimes generations – establishing. For help creating or modifying a farm succession plan, connect with us.


1 – Price, L. and R. Conn., 2012. “Keeping the name on the land’: patrilineal succession in Northern Irish family farming. Pp. 93-110 in Farm succession, inheritance and retirement: Challenges for agricultural futures. International Farming Systems Association (IFSA), 2012, pp. 2-16.

2, 3 – Farm Management Canada; 2016 Census for Agriculture in AgriSuccess, pp.20.

4 – Income Tax Act s. 110.6(1), s. 110.6(1.3), s. 110.6(2)

5 – Canada, Growing Opportunities, et al. “A Legal Guide to Farm Estate Planning in Manitoba.” Manitoba Agriculture, 202, pp. 1-64.

What Makes a Farmer?

What Makes a Farmer?

Where the famed work/life balance is an aspiration of many business owners, it can be virtually unattainable – and even undesirable – for farmers. “Farming life throughout the world is characterized by the almost inseparable, intimate integration of home, work, memories and family.” [1] More than just a job, farming is the locus of many families; a foundation that informs identity and gives purpose. 

As with anything business related, the financial side of farm succession often eclipses the equally valuable, personal side of the process. If you were to ask Revenue Canada Agency, a farmer is “the person who is assuming all of the risk in a farming operation.”[2] While useful for tax purposes and estate planning, this definition grossly understates what it means to be a farmer.

Agriculture and farming contribute an impressive amount to the Canadian economy – roughly 6-7% or $111.9 billion of gross domestic product (GDP) annually.[3] The economic importance of farming, coupled with the “greying” of farmers as a demographic (globally, not just in Canada), means intergenerational farm succession is increasingly lauded as the key to future agricultural viability.

Much of a farmer’s assets are in the form of physical capital – land, animals, and machinery – which tend to have substantial sentimental value.[4] Some farmers may shy away from transition planning given how emotionally and personally invested they are in their farming identities.

How does one begin to answer questions about what life after farming might look like when it is all life has been? For many, answers to these difficult questions come only after seeking outside help.

Financial advisors who understand farm succession is equally an emotional and financial process can help farmers envision and plan for a life after farming that invokes feelings of comfort, even excitement, and ensure the continued success of the family farm.

If you have questions about your farm succession plan or if you need help making yours, connect with us.


1, 4 – Whitehead, I., Lobley, M., and Baker, J., 2012. “From generation to generation: drawing the threads together”. Pp. 213-240 in Farm Succession, inheritance and retirement: Challenges for agricultural futures. International Farming Systems Association (IFSA), 2012, pp. 2-16.

2 – Canada, Growing Opportunities, et al. “A Legal Guide to Farm Estate Planning in Manitoba.” Manitoba Agriculture, 202, pp. 1-64.

3 – “An Overview of the Canadian Agriculture and Agri-Food System 2017.” Statistical Overview of the Canadian Fruit Industry 2017 – Agriculture and Agri-Food Canada (AAFC), 10 Nov. 2017,

[1] IFSA pp. 4

[2] Legal Guide, pp. 4

[3] “Overview of Canadian Agriculture”

4 IFSA pp. 4

There is No Time Like Now

There is No Time Like Now

“Do the best you can until you know better. Then when you know better, do better.” ~ Maya Angelou

There can be some unexpected emotions at play for those in the early stages of financial planning. Besides the normal ‘geez what DO I want my life to look like when I’m in retirement?’ confusion, people may find themselves grappling with more complex, uncomfortable feelings like guilt and shame.

Why do people feel guilt or shame? It may be because they feel like they should have ‘saved more by now’ or have a belief that ‘everyone is saving and planning better than I am’. It is important to remember that financial literacy is not “common sense” and figuring how and where to start building a plan can be overwhelming, even with professional guidance.

But here’s the thing. Establishing a financial plan is one of the most effective ways to replace guilty feelings toward money with a sense of control and empowerment. A recent study done in the U.S. shows a correlation between amount of savings (not necessarily income) and overall happiness; the more you have, the greater your sense of well-being. In other words, there is no point feeling guilty about what you have or haven’t done to date because it’s already done. So, let the guilt and shame go and commit to building a plan and taking steps forward.

You have likely heard the ‘rules of thumb’ when it comes to investing. “Save 10% of your income”, is one of the better known ‘rules’ and is often the one that can cause people the most anxiety. These ‘rules’ are actually more like ‘in ideal situations, it is best to’. For example, if saving 10% of your income is not possible for your lifestyle, then lower it. Even one per cent is better than zero. The earlier you can begin saving for your future, the more impact compound interest will have on your investments.

Selecting an experienced financial advisor will bring outside, unbiased insight into your current situation and determine the best road forward. A good financial advisor will work with you to move your plan towards where you want to be in the future. As life, circumstances, and demands on our resources change, a good advisor will review and modify your plan to keep you working towards your goals and ultimately, a sense of well-being.

Regardless of all the ‘rules’ of investing, they don’t apply equally to every investor and may not apply at all, in some cases. Your best bet is to work with a financial advisor to build your long-term plan, work on achieving it, and modify as needed.

Be kind to yourself. Financial planning reality is different for everyone and taking any steps in the right direction is a move forward.

Connect with us to learn how you can learn how to start today and ease your mind.


 Ally Bank survey. “New Ally Bank Survey Links Money to Happiness”

Farming Family Brings in Help to Talk About Succession

Farming Family Brings in Help to Talk About Succession

When it comes to estate and succession planning, open and intentional communication plays a big role in the success of a transition.

Talking with our families about money, especially when it comes to wills and estates, is not easy. In truth, it is something most of us would rather avoid, even if family discussions are an important step to ensuring our future emotional and financial well-being.

Professional mediation is an immensely valuable resource that can help facilitate productive, honest discussions that ultimately help to retain the long-term health of the family and the individuals involved.

Mediators understand historical issues and resentments sometimes resurface during discussions about wills and estates and can threaten relationships. Mediators are also aware of how inherent generational differences can make it hard to reconcile the older and younger generations’ visions for the future.

The mediation process is foremost geared toward improving family communication so the complex dynamics, found in all families, are dealt with in a productive way. The process gives everyone a chance to be heard and individuals are able to be open and honest about what they feel is important. Open communication, with a mediator, is one of the best ways to avoid future upset over wills and estates.

The Situation

The following is an example of a farming family who found value in the mediation process.

John and Ellen are in their 60s and have two married children, Jake and Rachel. The family has been trying to build and implement their succession plan for the past two years and, for various reasons, have found themselves unable to.

John plans to transfer the farm to Jake, his current employee, but is having difficulty relinquishing control and ownership. For John, much of his identity comes from his status as a farmer and the way it enables him to provide for and give generously to his family.

Both Ellen and Rachel fear John is overworking himself (and Jake) and putting his health at risk. Ellen would like to see more of her husband so they can start the third act of their lives and enjoy retirement together.

Jake wants his father to fully transition into retirement so he can gain more experience managing the farm, while his dad is healthy and be able to “start his life” with his wife.

Historical sibling issues between Jake and Rachel also factor into the succession planning process. Rachel has never been involved with the farm and does not want a share of the estate, rather, she wants Jake to succeed their father and take over the business. With her parents in retirement, she will be able to see them more frequently. She considers Jake lucky because he has the luxury of seeing their parents on a daily basis whereas she lives too far away to do so.

Jake, however, feels that he missed out on the parent-child relationship Rachel got to enjoy because he was so accustomed to working for John, as his manager rather than father. Both perceive each other as having an advantage in their relationships with John and Ellen. Even though Jake and Rachel are not at odds over their parents’ financial assets, the emotional complexity of their relationships with their parents and each other were inhibiting open, productive dialogue.

John and Ellen’s financial advisor recommended working with a mediator to facilitate a meeting with the entire family to discuss the family’s estate in a productive manner.

The Process

*         Before calling a family meeting, the mediator spoke to each member to hear their individual concerns and was able to assess them as a neutral, unbiased party.

*         The mediator emphasized:

  • Better communication practices such as explicitly stating what position individuals were speaking from (e.g. when is John speaking to Jake as a father and when as a manager?)
  • Ways to start dialogue and better articulate feelings and concerns
  • Taking accountability for the actions each individual committed to

*         John realized he needs to work on his life after business plan given that so much of his identity is tied to his role as a farmer. It took a neutral party to open his eyes to the concerns his family had already been voicing to him.

*         Jake and Rachel realized their historical perceptions of each other were not necessarily reflective of their current realities and were better able to understand one another.


Professional mediation is not a threatening or intimidating process. Mediators lay the foundation for healthy communication which ultimately serves to enhance the overall well-being of your family.

Seeking help from professional mediators who are outside of traditional planning roles (e.g. lawyers, accountants, advisors, etc.) can be immensely beneficial to the planning process.

At Intent, we work with a collaborative collective of professionals and are therefore adept at bringing in the best individuals to meet the unique needs of every client to ensure your long-term welfare.

Connect with us to learn how mediation can help advance your financial, estate and succession planning goals.