One issue in many father-son operations is one or both may be excellent farmers but lack financial and accounting education and experience.

There is nothing wrong with expansion, even into high priced land, as long as there is the asset base and cash flow from other holdings to have a high probability of executing a repayment plan.

If we think about it, at most times in our lives land has been too high priced to pay for it from the income it alone can generate farming. I read somewhere years ago that $700./acre financed at then current interest rates and corn prices was the most you could pay for midwest corn ground and pay for it from the crops. Numbers may have changed a bit but I think the outcome is still about the same. Just a fact of life.

Most of us are on this board because we love agriculture and farming, not accounting.

There is, as of yet, no New Ag Talk Accounting board!  If we wanted to be accountants we would be on some other board somewhere.

The solution is to have a good accountant review your plans before hand and keep up with them on a monthly basis. Someone who gets turned on by accounting, as we do with other areas of ag.

This also gets away from the incendiary type conversations such as "sons bankrupting fathers" or sons feeling fathers are too conservative. Both sons and fathers must understand the accounting - or get someone involved who does. And listen to them.

jmho.

Jim at Dawn

As much as we may love farming and dislike accounting we have to do the accounting or we may not get to do the farming next year...

Some sons may also make their Father/Son team some money too.