Dateline: 22 January 2014
|One of New England's most-photographed farms |
Farming is the traditional and, arguably, the best occupation for establishing a family economy. But you will never hear me encouraging anyone to go into farming these days. It is an extremely difficult and stressful business to get off the ground and make a living at, particularly if you are relying on the farm alone to support you and your family.
A crop farmer I know jokingly told me years ago that if he ever won the lottery, he would just keep on farmin’ until it was all gone. This particular farmer grew up on a farm and got his own farm right out of high school in 1960. He’s 72 now and still farming. Things were different years ago. It was not exactly easy to get into farming, but it was easier.
I was reminded of all this last summer when I happened upon the blog of a woman who was announcing that her family was selling their farm. It was a downright sad story. They had bought a farm four years earlier with a lot of passion and desire to grow high-quality food. They also wanted their children to grow up in the country. They went into farming for all the right reasons.
Here are some prerequisites to purchasing land [to have a farm]. Ask yourself if any of these have been met.
Have a viable patron base already purchasing what you are growing on land to which you already have access. This can be your own backyard, borrowed or rented land. The point is that you have a clientele that will follow you to your new location and provide a loyal marketing base to get a good profit on the very first thing that comes off your acreage.
Know how to make money on land. This, of course presumes you’ve been doing something long enough that you feel comfortable risking more than just sweat. When you begin risking your pocketbook, things get serious real fast. Your experiential confidence must be high. This does not include ideas you’ve gotten out of books or cooperative schemes you’ve picked up from magazine ads. If you’ve turned good money on a piece of land you’ve been working with, chances are you can duplicate this effort in similarly rewarding fashion on one you own.
Have enough money to live on for 5-10 years after you’ve completely paid off the farm. I don’t mean contracted for, I mean paid for. This one gets sticky. If your experience and knowledge level is low, your learning curve will be steep. You’ll make more mistakes than you imagine possible. Don’t worry, that’s normal for any fledgling business.
The average person who buys a farm today will have that farm back on the market within five years. This cycle is duplicated over and over and over again, and I don’t want you to go through it. Life is too short to be complicated with this.
I’ve seen this cycle repeated too many times. If you have enough money to buy the land debt-free, you won’t need to generate the cash to pay for it from your outside work. I cannot overstate the importance of this issue.
You can buy a couple of acres, move into a $3,000 used mobile home, and get started for perhaps less than $10,000. If you are debt free, you can work part-time while you develop your farm.
But if you have a mortgage to pay, even if it’s only 3,000 per year, it will saddle you with cash requirements that will push you into a more demanding off-farm job, which will leave you less flexibility to develop the farm. The magazine Countryside has featured testimonials time and again from folks who maintained a family on less than $500 per month. My own experience was like this.
The best money you can make is what you save on living expenses. Get rid of the second car, quit patronizing the grocery store, and do more for yourself. If you grow most of your own food, harvest your own heat off the farm (firewood) and get clothes at the thrift store, you can live quite cheaply. As the farm becomes lucrative, you can begin to upgrade. You will see what you can more economically buy off the farm than grow yourself, and you can begin focusing more energy on the things that generate a high return per hour.
But you must keep your cash requirements low. If you’re going to move onto the acreage, build a nice, acceptable house with well-mowed lawn, you’d better have deep pockets. In such a case, if you can’t live farm-income free from 5 to 10 years, forget it.Why so long? It will take you that long to go through the learning curve.
Business guru Peter Drucker charts the business cycle and points out that any new business has a 7-10 year period before it becomes lucrative. There just aren’t any shortcuts to this no matter how you may think folks that are there got there easy. None of us did.
What do you think?
Also, Though I am not a farmer, I do have a successful (it pays the bills) home-economy business in the country, and much of what Joel has written is pertinent to getting a home business launched. That last paragraph says a lot.