Passing It On: An Estate Planning Resource for Farmers and Ranchers Cole Ehmke Extension Specialist Department of Agricultural and Applied Economics 17 April 2007 Phoenix, AZ National Extension Risk Management Conference

2 Observed Need Development objectives: show how to deal with some of the difficult personal issues provide exercises and checksheets to set goals and move forward provide background on the primary tools used to implement a plan list Wyoming resources to assist in the process.

3 Development Development Team (organization and content) –Lucy Pauley and Carolyn Paseneaux, Wyoming Department of Agriculture Mediation –Alan Schroeder and Cole Ehmke, University of Wyoming Extension Partners (content) –Legal and content experts, estate planning advisors, insurance representatives –Initially potential partners were indifferent; now enthusiastic

4 Estate Planning Process 1.Discover Expectations: communicate goals, issues, concerns, etc. of all parties 2.Take Stock: Personal net worth statement 3.Examine Options/Tools 4.Agree to the Plan

5 Baseline Components Someone has to initiate the dialogue Develop shared goals –Outline your interest first, then share (don’t assume) –Be fair, inclusive and over-communicate Centralize information Assess tools and visit professionals (after goals are set) Get it done (agree to the plan, and implement it)

6 Content Chapter 1 Introduction Chapter 2 Success Stories Chapter 3 Establishing an Estate Plan Chapter 4 Developing Common Goals Chapter 5 Taking Stock of the Estate Chapter 6 Succession Planning Chapter 7 Tools Chapter 8 Coming to an Agreement Chapter 9 Resources

7 Chapter 1 Introduction by Lucy Pauley -Introduction to estate planning -Common problems -Project objectives

8 Estate Planning Defining the Term It is the process of accumulating, preserving and distributing assets to achieve the financial goals of people during their lifetimes, and to provide for their heirs according to the estate owner’s wishes at death.

9 Chapter 2 Success Stories Story 1: Harding & Kirkbride Livestock Co., Meriden, WY Story 2: The Sims Ranch, McFadden, WY Story 3: Johnsen Farm, New Jersey

10 Chapter 3 Establishing an Estate Plan for Your Family’s Farm or Ranch Business – Initiating the Dialogue by Alan Schroeder Material is mediation based Addresses why these conversations are difficult Guides the initiator and provides process and three approaches

11 Chapter 4 Developing Common Goals by Cole Ehmke Emphasizes the importance of shared goals –Outline your interest first, then share (don’t assume) Lists typical goals and provides worksheets to rank

12 Chapter 5 Taking Stock of the Estate by Cole Ehmke Addresses three parts of taking stock of an estate: –Identify assets and liabilities in the estate –Locate papers and documentation –Establish a personal net worth statement Excel spreadsheet is available (online)

13 Chapter 6 Succession Planning Transfer of management (and choosing a successor) Transfer of ownership Transfer of labor

14 Chapter 7 Tools by assorted professionals Wills Probate What Everyone Should Know About Trusts Estate Planning and Life Insurance Gifting Effects of Title Ownership of Property Annuities The Federal Estate Tax Conservation Easements Advanced Health Care Directives Glossary

15 Chapter 8 Coming to a Good Agreement Regarding an Estate Plan for your Family’s Farm or Ranch by Alan Schroeder Mediation based Guides how to conduct a family meeting(s) on the final estate plan Provides three possible approaches Outlines a specific negotiation technique which addresses some of the concerns raised by other methods.

16 Chapter 9 Resources Lists professional organizations (specific to Wyoming) Lists other estate planning publications (both general and specific to agriculture)

17 Distribution Hard Copy (mail order for $10) Electronic (free): Workshops –10 winter workshops; reached 142 farmers/ranchers –2 hours each, with legal professional

18 Future Work Expand content –Non titled (personal) property distribution –Philanthropy –Funeral planning –Retirement planning Assess success –Survey of users

19 For additional information on Passing It On, personal resource management and agricultural diversification, contact Cole Ehmke Department of Agricultural and Applied Economics University of Wyoming, Laramie, WY (307) ces.uwyo.edu/passingiton.asp