Ag economists offer tips for farmers in financial distress - Entrepreneur Generations

Farmers are increasingly stressed over financial issues; agricultural economists from the University of Kentucky are offering some tips that could help them figure out solutions and connect them to resources that can help.

First, farmers must have a good understanding of financial statements and key financial performance measures to effectively measure a farm's financial health. That includes balance sheets, income statements, financial performance measures (such as profitability, liquidity and solvency). Farmers in Kentucky can access the Kentucky Farm Business Management Program for help with understanding financial statements and measures; other states may have similar programs.

Experienced farmers are likely familiar with the U.S. Department of Agriculture's Farm Service Agency loan programs, but new farmers should make sure to learn about them and understand how each can help: the Guaranteed Loan Program, Farm Operating Loans, and Emergency Loans.

A farmer considering quitting or retiring needs to fully understand the tax consequences first and how to plan ahead to for minimum tax penalties. That means considering how to dispose of assets like grain in storage, market livestock, equipment, and land.

Bankruptcy may be necessary as a last resort; it's important to understand the different types of bankruptcy and how one can recover and possibly continue to operate their farm afterward.

If a farmer wants to transition to another profession or work part-time off the farm for extra income, it's important to remember that that doesn't mean failure; 91% of farm households have at least one family member working an off-farm job. The article finishes up with a list of resources that farmers may find helpful in managing farm stress and mental health.

from The Rural Blog http://bit.ly/2PO6L7u Ag economists offer tips for farmers in financial distress - Entrepreneur Generations

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