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Keeping the farm in the family

Succession and exit strategies for farmers

Family farms come in all shapes and sizes — and so do their needs.

Life insurance can benefit farmers in many phases of their life and business. Our Business Owner Life-stage Design (BOLD) can help identify business strategies they need now, and in the years ahead. And the BOLD Family Farm Strategy lets you tailor solutions specifically to their farm business at any life stage.

BOLD sales support

Contact the Securian Financial Advanced Sales Team today.

1-888-413-7860, option 3

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Farm owners need forward-thinking plans

Typically, farmers and their families work the farm operation together, sometimes as soon as a young son or daughter is able to walk. True ownership of a family farm takes many forms — and many farmers don’t intend to “retire” until the earth calls them home. This makes farm succession and exit planning unique.

While many farmers know and hear about the importance of estate planning, the discussions are more underlying understandings, rather than directly communicated or written out. This is where your financial guidance can be critical to the proper strategies needed to pass the farm onto successive generations.

Even though your client may have placed estate planning as the highest priority, generating and funding effective succession strategies can take years.

Your clients generally have two choices: pass the farm to family members or find the right buyer for the operation.

Family farm financial planning

Farmers are business owners who may look to you for help with:

  • Growing their business
  • Saving enough for retirement
  • Preparing for the expected and unexpected
  • Maximizing and efficiently transferring the value of their estate
  • Estate planning between their heirs

Assessing needs

Learn how to identify the farmer’s stakeholders and assess their current situation, as well as outline their goals and priorities.

Learn about assessing needs

Succession strategy

This strategy focuses on having the right estate plan to help ensure the family farm stays within the family, while keeping peace within the family.

Learn about succession strategy

Exit strategy

This strategy focuses on having the right buyer of the family farm and preparing for all the contingencies that may arise.

Learn about exit strategy

Take BOLD action

Learn how to use BOLD with clients

Your business owner clients need life-stage specific tools. ­We’ll help you find the right solution.

View the step-by-step process

Life insurance products contain fees, such as mortality and expense charges, (which may increase over time) and may contain restrictions, such as surrender periods.

Please keep in mind that the primary reason for purchasing life insurance is the death benefit.

Additional agreements may be available. Agreements may be subject to additional costs and restrictions. Agreements may not be available in all states or may exist under a different name in various states and may not be available in combination with other agreements.

Policy loans and withdrawals may create an adverse tax result in the event of lapse or policy surrender and will reduce both the surrender value and death benefit. Withdrawals may be subject to taxation within the first fifteen years of the contract. Clients should consult their tax advisor when considering taking a policy loan or withdrawal.

The Policy Design chosen may impact the tax status of the policy. If too much premium is paid, the policy could become a modified endowment contract (MEC). Distributions from a MEC may be taxable and if the taxpayer is under the age of 59 ½ may also be subject to an additional 10% penalty tax.    

An annuity is intended to be a long-term, tax-deferred retirement vehicle. Earnings are taxable as ordinary income when distributed, and if withdrawn before age 59½, may be subject to a 10% federal tax penalty. If the annuity will fund an IRA or other tax qualified plan, the tax deferral feature offers no additional value. Qualified distributions from a Roth IRA are generally excluded from gross income, but taxes and penalties may apply to non-qualified distributions. Please consult a tax advisor for specific information. There are charges and expenses associated with annuities, such as surrender charges (deferred sales charges) for early withdrawals.

This information may contain a general discussion of the relevant federal tax laws. It is not intended for, nor can it be used by any taxpayer for the purpose of avoiding federal tax penalties. This information is provided to support the promotion or marketing of ideas that may benefit a taxpayer. Taxpayers should seek the advice of their own tax and legal advisors regarding any tax and legal issues applicable to their specific circumstances.

For financial professional use only. Not for use with the public. This material may not be reproduced in any form where it is accessible to the general public.

DOFU 10-2022