No One Owes You A Living!

 

The world, including the US, does not owe you a living. Or as Dave Ramsey would say, “You Are NOT Entitled To Anything“. If you dream to make a widget and insist that everyone must support you in your dream and insure that you make a full time living making that widget, then i fear you may be sorely disappointed.  Especially, if your widget making imposes on others’ freedom and property rights.

There are very few, if any, financially successful people with no debt and have, or are building wealth, working only one job.  Often the most successful have at least 2 or 3 other gigs on the side going.  (Even Warren Buffet has several unrelated income streams going!)  When you are in your teens, twenties, and even into thirties, you have energy, vision,  and motivation that enable you to put in 10-16 hours a day, 6 days a week.  This allows you to save, build equity, and work towards your dream job if you aren’t already doing that.  When you are older and that energy level drops, hopefully those side gigs are the money invested which are then working for you rather than you working for it.

I recently wrote a blog which told of the near impossibility of a person to get into farming or ranching these days.  This is largely due to the out of balance cost of land vs its productive value.  However, it is not yet impossible to farm and build wealth – even without incurring massive debt!  It may take longer, however.  And, i know of absolutely no one – young or old, in the present or in the past- who can farm or ranch (or any other business for that matter) full time without some sort of side gig.  Read stories of old timers – they were blacksmiths, carpenters, mechanics, traders, transportation specialists, suppliers; any skill they could put to use for pay was engaged.  Wives farmed alongside their husbands, raised the children, and often had a couple side gigs as well.  (Yes, i know that many women are farmers and ranchers, i am one, but also raised my own children, managed the household, and help with the farm.)  It is the same today – if you want to farm (or start any business for that matter) you’d better put a sharp pencil to how you’ll put food on the table and a roof over your head.  Don’t incur debt and make sure you have some savings.  (a borrower is always slave to the lender).  Operational farm debt is as bad as school loans.  Debt for building  a depreciating asset may be the worst of all!  What if something happens to you?  make sure you have plenty of life insurance!  Liability, maintenance, disease, accident associated with buildings and machinery are expensive and ongoing.  Once debt is incurred for a single purpose gadget, you have to keep it going or you may default or leave your family with a ball and chain which seldom adds value (it may actually devalue) to your property. Better yet, don’t go into debt.

Keep your paying job and save your money before you buy a single acre or cow or gadget. Many ranchers today are leasing both land and cattle which can be a great way to get started with very little investment or risk.  Best book i’ve read on this is Greg Judy’s book, No Risk Ranching.  Maybe you won’t have the exact same opportunities that Greg has, but use your imagination – maybe you’ll have to move – as Allan Nation, founder and former editor of Stockman Grass Farmer, used to say, “Everyone has an unfair advantage.”  Figure out yours and put your best foot forward.

Many farmers today still abide by the ways of Earl Butz to ‘get big or get out’ and we now have such an abundance and overproduction of all products that prices continue to slide.  Yet, the mantra continues to be ‘produce more’  and use the economy of scale to maximise profits.  That may good to a point, but the cost to the environment has been substantial by farming ‘fence row to fence row’  and with government subsidies now firmly entrenched there is less risk of a ‘failed crop’ resulting in going broke regardless of debt load or lack of wise financial planning.

I’m not espousing a return to farmers falling out due to the vagaries of weather, political machinations, or burdensome regulations.  Without subsidies, food, fiber, energy prices could soar to the level of parity and the consumer would certainly cry ‘foul’.  But, we all must remember that the economic  rule of supply and demand may cause us to consider better management practices.

There is the concept of focusing on profit rather than production.  If it is possible to make more money producing 120 bushel corn to the acre rather than 200 bushels to the acre, would that be something to consider?  what is the cost to the land and quality of life to produce 200 and even 300 bushels to the acre?  Can i do a better job of regenerating and improving the soil i have to increase pounds, bushels per acre and lower cost as well?  There are a lot of opportunities and new/old practices to learn – the hard part is keeping it simple and CHANGE!  This is a head issue – don’t be a stiff necked people.

Speaking of quality of life – how have you organised your dream?  does it enhance and edify others?  or detract from the lives of others?  is it sustainable?  is it regenerative?  can you keep doing this for the next 60 years?   If not, it’s not sustainable and you had better have a plan in place for the future, less strong, less energetic you.  Will your model rely on unpaid labor of yourself or your family?

Happy Planning!

 

Proverbs 6:

1My son, if you have put up security for your neighbor, have given your pledge for a stranger, 2if you are snared in the words of your mouth, caught in the words of your mouth, 3then do this, my son, and save yourself, for you have come into the hand of your neighbor:  go, hasten,a and plead urgently with your neighbor.

4Give your eyes no sleep and your eyelids no slumber; 5save yourself like a gazelle from the hand of the hunter,blike a bird from the hand of the fowler.

6Go to the ant, O sluggard; consider her ways, and be wise. 7Without having any chief, officer, or ruler, 8she prepares her bread in summer and gathers her food in harvest.

9How long will you lie there, O sluggard? When will you arise from your sleep? 10A little sleep, a little slumber, a little folding of the hands to rest, 11and poverty will come upon you like a robber, and want like an armed man.

12A worthless person, a wicked man, goes about with crooked speech, 13winks with his eyes, signalsc with his feet, points with his finger, 14with perverted heart devises evil,
continually sowing discord; 15therefore calamity will come upon him suddenly; in a moment he will be broken beyond healing.

16There are six things that the LORD hates, seven that are an abomination to him:
17haughty eyes, a lying tongue, and hands that shed innocent blood, 18a heart that devises wicked plans, feet that make haste to run to evil, 19a false witness who breathes out lies, and one who sows discord among brothers.

 

Writing a Farm Lease

Though i now don’t plan to lease out again, many people will, so below is an article and link which may give you some ideas on what to address in a lease agreement.

Online searches will give you oodles of ideas to consider adding to your lease.  A link to a sample PDF Missouri cropland lease, Verbal Farm Rental Lease Agreements, Missouri Farm Leases; Legal Aspects,

If you are the tenant, Greg Judy has a book devoted to writing agreements and working with landlords.  No Risk Ranching

Developing A Sound Farm Lease Agreement

Your local link to MU for ag extension and research information

To send a message to an author, click on the author’s name at the end of the article.

Northeast Missouri Ag Connection

Volume 6, Number 10 – October 2019

This Month in Ag Connection


This Month in Ag Connection | Ag Connection – Other Issues Online

Developing a Sound Farm Lease Agreement

Farm lease agreements can be cash, share or flexible. Each type has some unique characteristics, but some items should be in all types of written leases.

Names and signatures of all parties is essential. This means if one or both parties are married, then the spouse should sign. It is recommended to include the addresses of each party, as well as, date when signed. A notary is not required, but can be used.

A description of the property to be leased should be included. This can be the legal description and/or the Farm Service Agency farm and tract number. If the property is known by something else such as the “Brown Place” then it should be included. Producers and landowners are more likely to be familiar with the farm and tract number or the common name for the property rather than the legal description. Another reason to include the common name of the property and the farm and tract number is for easy reference in case the main business operator is incapacitated.

The lease period should be clearly stated. Is the lease term for one year, two years or longer? The start and end date including the year should also be stated. Some leases will state a 30, 60, or 90 day written notice period if either party wishes to terminate the lease on the end date. This is not required, but done to allow each party time to find new ground or a new tenant. It also helps manage expenses for the tenant, specifically prepaid items and operating loans. For the landowner, they may rely heavily on the rent income so they may use the time to secure another renter. In Missouri, unlike our neighboring states of Iowa and Illinois, written farm leases can start and end on any date designated by both parties. This is another reason the length of the lease should be clearly spelled out.

Rental rates and arrangements are another essential part of a good lease. Rental rates are often determined by the going market rate for that area. Before arriving at a price based strictly on the area’s going rate, look at yield history of the ground. Some of this will be determined by the tenant’s inputs, but over time, especially with different tenants, a trend line should emerge. Knowing yield data benefits both the landowner and the tenant so the sharing of yields could be incorporated into the lease. When looking at a rental rate, from the producer side, determine how much can be paid for rent based on individual cost of production. Iowa State University Extension has a tool that does this and can be found at https://www.extension.iastate.edu/agdm/wholefarm/html/c2-20.html

From the landowner viewpoint, decide if this is a financial investment with the highest price in mind. On the other hand, are there other factors that make a difference, such, as does the tenant keep the farm looking good? Do they watch over the place in your absence? Are they responsive when contacted and communicate well? What is important will vary according to the situation.

Along with the rental price, the timing of the payment or share should be specified. For a cash lease, this is often twice a year, but could be once a year or other specified times like quarterly. The date of the payment and amount due each time should be in the lease. For crop or livestock share agreements, this could be at the point of sale or a set number of days after harvest or sale. The producer should keep an accurate record of expenses. Sometimes these are split according to the percentages throughout the year and sometimes they are settled up after harvest or sale.

Another key element is right of entry. A landowner will not legally be allowed to enter their own leased property unless this right is reserved. This is usually done for inspection of the property or to accesso another piece of ground not leased. This point is not one that is often a problem, but should be discussed so crops are not damaged or livestock riled by excessive entry.

If the landowner wants to reserve the hunting and fishing rights, that should be added to the lease. Otherwise, those rights are transferred to the tenant.

Operating expenses need to be clearly stated. In a share lease, expenses are typically shared the same way as the crop or livestock income. Ideally, it is best to spell these out to avoid miscommunication and so that those expenses can be tracked. Sometimes an expectation exists by one party in a lease, but is not written. A common example would be the tenant expecting the landowner to supply lime on pasture and hay ground. While this is a common custom for short-term leases, it is not required.

Conservation practices is another point of discussion. Will growing crops have to be torn up to build terraces or will wheat have to be planted for the landowner to be eligible for terraces? Is there a place to move the cattle, while a pond is built? Do we agree on the conservation plan or is there a reason for a certain rotation such as a persistent weed problem?

Improvements and repairs are a part of any operation. Determining who is responsible for the decisions and labor; who will pay for what; and when will they be done is important when entering into the agreement. Issues may include fence or facility concerns to rill and gully repair to the installation of wider gates for bigger equipment. If something comes up unexpectedly during the lease period, an amendment can be added to the lease if all parties agree.

A statement such as “this lease does not constitute a partnership” clarifies the relationship and affords some liability protection. Arbitration is another item to consider including in the lease. This allows a way to settle issues that the parties cannot agree upon. The intent is to avoid legal proceedings and finish the lease term.

In summary, a good lease involves clear and concise communication. It is easier to do this if the agreement is in writing. An excellent resource for written lease documents is https://aglease101.org.

Source: Darla Campbell, Ag Business Specialist

Living the Dream

This was written by a friend from north Missouri in honor of her hard working husband (farmer and welder, Lone Oak Fabrication, LLC, Clarence, Missouri), though it is a testament to her hard work and sacrifice as well (i would consider Erin a modern day Proverbs 31 woman).  Sometimes we grumble about our employers and some may go on strike, but oftentimes, especially in small towns, with small start up businesses, the owners are paddling like crazy to keep the operation afloat.  If he or she has the opportunity to hire someone to come along, that is a bonus for everyone.  If you, as the employee, think you are mistreated or underpaid, then move on to your dream job with dream pay, don’t undermine the efforts of the small businessman by not giving your best each day.       (tauna’s comments)

 

  • This is what being self-employed looks like.It’s working 80 hours a week so you don’t have to work 40 hours for someone else.It’s getting up extra early to work before the rest of the day hits.

    It’s putting in a few more hours after you kiss your kids good night.

    It’s leaving the house before your spouse is awake and coming home after they are asleep. Sometimes only talking to each other via text for days at a time.

    It’s making sacrifices and pinching pennies.

    It’s throwing your whole heart into a dream, a vision, a goal for a better future.

    It’s the thrill of knowing you can manage your own time and the sickening feeling when you don’t manage it well.

    It’s making out invoices while your spouse addresses the envelopes because you’re working this dream together.

    It’s having the guts to take a risk and knowing if it doesn’t work out, you learn the lesson and try again.

    It’s all this and so much more. I’m so proud of you David.

Erin Spurgeon, wife, mother, educator, small business owner, Stitches & Staples

Working Cows and Calves Friday

The weather looks like it’s going to be perfect for pregnancy checking my cows and vaccinating late April through May born calves.  With daughter Jessica off teaching 1st grade this year in Hanoi, Vietnam, i’m short someone to do the tagging.  So that job gets shuffled between me and whoever is head catching the animals.  Not as efficient, but there is no one to pick up that job.  I do have most of the calf tags ready and most of the replacement tags for cows.

 

This peaceful video was taken Wednesday afternoon at my farm while i was up there working.  Happy cows and calves.

Sprouting!

Basic instructions for sprouting healthy addition to salads, sandwich toppings, or  a stand alone snack.

Put 3 tablespoons of seed into your sprouting jar.  Add 2-3 times as much cool (60°-70°) water.  Mix seeds up to assure even water contact for all.   Let stand in water 6-12 hours.

Drain off soak water.  Rinse thoroughly in cool water. Drain thoroughly!  (this is important)

Set sprouting jar anywhere out of direct sunlight and at room temperature (70° is optimal) between rinses. Ensure sufficient air circulation is provided.

Rinse with cool water and drain thoroughly every 12 hours for 3-7 days.  Always drain thoroughly.  Refrigerate after growing if you don’t eat them all straightaway.

Food borne illness is a possibility when consuming raw products.  Sprouts will smell fresh not musty.  Keep them cool.

Here’s an interesting article concerning health benefits.

Raw Sprouts:  Benefits and Potential Risks

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Day 1 – 3 tablespoons of sprouting seeds in a quart jar with screen top or use cheesecloth and a rubber band.  These are broccoli, alfalfa, radish, and clover seeds.  I’ve chose Food To Live brand, but there are others.
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Day 1 – pour in some cool water, swish it around to stir up the seeds, then allow to stand in water for 6-12 hours.  Pour out the water.  Add more and swirl around then drain thoroughly.
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Day 3 – Be sure to add cool water, swirl it around to rinse seeds and drain thoroughly EVERY DAY TWICE A DAY!
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I start another batch every 3 days or so because i like a continuous supply to eat if i want them.  This batch is using 2 tablespoons rather than 3 tablespoons in this quart jar which should allow more room to grow longer and green up more.  This also helps eliminate those extra crunchy seeds by allowing the it to sprout longer.
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This first batch had filled the jar in 6 days.

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Great for toppings on sloppy joes, sandwiches, and most everything!  —  well, maybe not ice cream.
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Or as a stand alone salad.  Here i sliced olives and our home raised eggs.  Squirt a bit of dressing you like on top or none at all.  

Surprising Sweet Potato Crop

So excited to dig in the tubs and find some sweet potatoes!  Granted, probably not enough to justify the purchase of slips and certainly doesn’t include my labor, but i still had a harvest and that’s no small thrill for me!

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That’s my sweet potatoes i grew!  Apples are from my father-in-law’s tree.  Using these to make that delicious Sweet Potato & Apple Marshmallow Casserole.

 

Sweet Potato & Apple Marshmallow Casserole

INGREDIENTS:

  • 2 large sweet potatoes peeled and sliced ¼ inch thick*
  • 3 large apples peeled, cored, and sliced ¼ inch thick*
  • 1 cup marshmallows
  • ½ cup butter     

Sprinkle Mix:

  • 1 tablespoon cornstarch**
  • 1 teaspoon sugar
  • 1 teaspoon cinnamon
  • ⅛ teaspoon salt

DIRECTIONS: 

Assemble the casserole by layering half the potatoes and half the apples, then dot with half the butter and marshmallows.  Sprinkle half the mix, then do the layering process again.

Cover with foil and bake in a 375°F oven for 35 minutes.

  • *substituting pears and winter squash works great
  • ** or tapioca (cassava) starch

From the kitchen of sister-in-law, Shawna Penn and is a staple for the Penn Family Thanksgivings.

 

 

Debt Free Education

Dave Ramsey is on a rant, but worth considering!  This video is an ad for a new product designed to give you ideas on how to get an education without incurring student debt.  I have not ordered or read the book yet.

Can a debt free education be had?  Yes, I personally know a young man who is my son’s best friend who has done just that.  He started working as a young teenager on the farm and by the time he could legally work for other people (14-16 in Missouri, depending on the job), he knocked on doors and worked.  Additionally, he started his own lawn care business and by the time he graduated high school, he had enough money to pay for a 2 year associates degree at a local college while simultaneously attending and graduating from Grand River Technical School as a welder!  Now, the next smart move, though his dream is to farm full time, he got a full time position as a welder at a shop which is allowing him to replace the savings he spent on his education.  Now, a year and a half into that, he was able to purchase a portable welder/generator so he can start his own business.  Yeah, he’s still working full time until he builds a good customer base and he is farming alongside his dad at Sycamore Valley Farm.  WOW!

North Missouri is an economically depressed area of the US, but financial success can be had with good decision-making and hard, but smart, working ethic.

Dave Ramsey “America is Being Harmed By Its Own Government

 

 

Faith, Family, Farm

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