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Farmers sure like to give the impression they are all broke. While so many live in 3000 sq ft houses with $80,000 pickups in the driveway and go on 4-5 week vacations during winter and have $40,000 campers parked at the lake or have cottages...

I'm not saying they are all that way but a lot are.

We make money on our farm and I'm not ashamed to admit it. (Nobody here has a 3000 sq ft house or a cottage or go on month long vacations either, we all have pretty nice trucks though)

I hope to build our farm up in the future too and not so I can cash in at the end, hope one day that any kids I may have want to keep farming, same thing my dad and uncles did for me.
NOW if you were a DENTIST:sFun_mischieviousbi you could also spend $50G and go shoot a docile old lion that just lays around doing nothing all day !!
 

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A 10 million farm is not large. What would you pay a ceo to run a 10 million dollar business. And consider that the ceo does not have any loans signed. If maximizing wages is the priority then there are easier ways to do it. If you like what you are doing, then you never have to go to work. Bureaucrats and intellects are driving costs , and frustration levels up.
 

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When you see farmers spraying fungicides because they had dew one morning in two months, there is definitely a profit in farming.

Or 3 times the combine, airseeder, sprayer capacity then needed, there is definitely a profit in farming.

Or autosteer in everything from the lawn mower to the swather, there is definitely a profit in farming.
 

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Of 4 siblings, the two that went computer field and the one who is a military wife have net wealth in the hundreds while the one who went for next generation farmer easily net worths in the millions. It's not all tied up in land, fuel and machinery either. There is cash if cash is needed.

They say, stay in school, study hard and one day Dad will tell you to go get a job somewhere else and you will one day be worth 5% of what your brother is.


:) Life is good, just sayin.. There is some money in it somewhere.
 

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Generally there is money in farming, most farmers don't count their wages but it is part of the profit. Also a large proportion of your living expenses is made up by the farm in the means of fuel, accommodation, insurances, power, water, vehicles. If you added these to a wage earner you effectively double their wage. So double whatever you are drawing.

If we are going to compare apples with apples we must look at it this way. Most wealth is not created instantly. True wealth (financial) is where your money is working for you not you working for it. The shop owner draws his wages and at the end of the day is able to sell his asset that he has built up but it is largely made up of goodwill rather than substantial asset. We spend the first half of our career getting to the phase where our money works for us.

As a manager we need to be careful to build value into the right areas. A leasing operation is looking for cash profits but an owned operation is looking for equity in their land. Our main problem is an addiction to shiny metal (not gold) . Machinery assets need to be targeted and worked hard to pay for themselves. I see BTO with shiny new tractors that have put ten thousand hours on their clocks in the time I have put four thousand. Mine is not working hard enough to be efficient. We have moved our targets forward for when we want to finish an operation, we need to be careful that that is making us money or we are paying the right amount to mitigate the risk.
 

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Sure I make money...lots of my neighbors make money as well. I am fortunate to farm in a good area but that doesn't assure you that you're making money. I have non farmer friends who are definitely no better off than me...maybe even a little bit worse. I don't feel bad for not having had to buy my Dad's farm out right...make no mistake I didn't get it for free either. We did buy my wife's father's farm. I also don't believe in the growth of a farm just for growing sake...it has to make sense and you better have a plan. I have 4 kids and I'm not discouraging any of them from farming, heck I'm encouraging them but ultimately it's up to them. I will support them in whatever job they pursue. I also try to instill in them that land should not be sold, even if you don't farm.

So yes we make money...enough to live comfortably my parents included and the next generation has to be able to make a living off it as well if they come on board to farm so within the next 5 years or so we could have 3 generations living off this farm.

just my 2 cents

oh by the way I don't feel bad at all making money on my farm, I also don't envy some of my very successful neighbors...all the power to them...I usually cozy right up to them to find out what they are doing right ;)
 

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It all depends on how you look at it and what you put your values on. I wake up every morning at home with my wife, kiss my kids good-bye, walk out the door and am technically at work. Lucky enough to farm with my two best friends, my brother and my dad ( as frustrating as that may be some days!). Love every aspect of farming, even the dirty work, so much that I can say I have never had to work a day in my life. I may not have everything I want but love every thing I have. Even the 20 hour work days are enjoyable. Compare all this to someone who hates their job so much but just do it for the money and the pension that their lives are miserable and all they do is complain about their lives. They may have nicer homes, toys, etc. and can retire 20 years earlier than me, but you know what, I am a way richer man than them!
 

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Discussion Starter #32
I don't have any machine payments at the moment but thats probably going to change. I am making land payments and buying moderate inputs. I don't go crazy on them because a small farmer like me can be put out of business in a single year if things go south. With all those expenses, for sure I don't make money every year no matter what crop I grow. In just my time, I have seen canola and flax at $7 and peas and wheat at $3.50 and lentils at 10cents. I have made more money owning land than farming it unfortunately.
 

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Discussion Starter #35
Lots of guys look like they're making money until Richie moves in.
I am always astonished at the first 100 or so pages of the Richie auction books. People with an absolute brand new line of everything and they are auctioning it all off. Then at the back you see the guys who stretched with junk for the last 15 years until they retired.

I also got a kick out of one of the farms names this year "Futuristic Ag Producer" :5:
 

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There is good money to be made in farming if it's managed properly. However, like any other business venture, you also need some good luck. NO business can do well without some luck. Most farms that struggle are because of bad management IMO but not all. Some struggle due to bad luck. The wealthiest people (financially) I know are pretty much all farmers and I am very happy for them. They earned it. Farmers are a strange breed in that they don't want anyone to know they are successful and want the world to think they are failures. As far as getting everything handed to you IE inherited farm, over the 35 years that I have been involved in agriculture, I've seen several people inherit sizeable farms with a good line of relatively new equipment debt free and lose it all due to poor management and I've seen several guys start with nothing and build a sizeable profitable business farming due to good business management (and some luck). For those that have the advantage of inheriting a farming operation, I'm happy for them but it is no guarantee of success. They STILL have to manage the operation properly. They just have more room for mistakes.
 

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Discussion Starter #37
I think the distinction was asset rich vs cash flow rich. Farmers always become millionaires in assets but in cash crops not so much or even if you do, a lot of it sunk back into the farm. Evidently you still need to make your payments and keep the lights on but after you have done all that, is there a large cash stockpile being built up aside from the other assets.

I know in my case, the answer is no. I have a little left over for investing and a small cushion some years, but then some of that cushion is tapped every few years to make up for some shortfall at least in the last 5 when we have had so much flooding.
 

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I think the distinction was asset rich vs cash flow rich. Farmers always become millionaires in assets but in cash crops not so much or even if you do, a lot of it sunk back into the farm. Evidently you still need to make your payments and keep the lights on but after you have done all that, is there a large cash stockpile being built up aside from the other assets.

I know in my case, the answer is no. I have a little left over for investing and a small cushion some years, but then some of that cushion is tapped every few years to make up for some shortfall at least in the last 5 when we have had so much flooding.
Many farmers CHOOSE to be asset rich and cash poor. Like someone posted earlier, many farms run more combine, tractor, sprayer, drill capacity than is necessary for the size of their operation. That is a choice to give the machine dealers their cash rather than keeping it for themselves. That's a HUGE part of managing any business that requires equipment and many farmers are very poor at it.
 

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Many farmers CHOOSE to be asset rich and cash poor. Like someone posted earlier, many farms run more combine, tractor, sprayer, drill capacity than is necessary for the size of their operation. That is a choice to give the machine dealers their cash rather than keeping it for themselves. That's a HUGE part of managing any business that requires equipment and many farmers are very poor at it.
Or they don't want a tax problem. Wont be an issue in my area this year
 

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I see many neighbours and family be cash poor asset rich. It is a decision. The nature of farming pulls that way. As I imagine many business are the same way for the owner.

I am still in my first third of farming(I hope), and there are pulls for my money, expansion, upgrades. We have had good years on the farm. My wife and I decided to take some money and build a new house, move to the farm and enjoy it with our young family. We could have lived in the old house and reinvested the money in the farm. Probably would have been a great business decision. Money invested smartly when young should earn huge by retirement. But the farm is there make money for our family. I see that saving and reinvesting is important. I want to have something for my kids. But I have seen too many ppl stitching up old underwear for 60 years to get by, then die with wads of cash that never really served a purpose. I don't need all that money when I am dead. We are going to spend a bit along the way and die with less
 
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