The first step to have the next generation come back to the farm or ranch is to get them there. The next step is to keep them there. This requires thought about how to transfer management and ownership of the operation over a period of time. Four phases of transfer have been identified and are discussed in this article.

The first phase is Testing. Before transferring management and ownership, the current owner needs to feel like the younger generation is "tested" or able to effectively help with the operation. One older farmer said to me, “I think my sons want to come back and drive the GPS-guided tractor. I don’t need them here for that, I want to do that. I need them here to work on fence, shovel manure, and paint the outbuildings, the work that is getting harder for me as I get older.”

Sometimes the older generation would like to bring their child and spouse back and want to add some type of livestock enterprise. When asked about the experience of that younger generation with the proposed enterprise, you find out that they have never been around that particular enterprise before. Or, if there is some contact or experience, the experience is very limited. Be sure the proposed enterprise is something that the potential laborers and/or managers of that enterprise will be able to work and enjoy.

Can the younger generation be put on the business end of a scoop shovel for the rest of the older generation’s career? That is probably not a good idea. There are other responsibilities of the operation and producers should consider how those responsibilities could be transferred over time. Testing is just the first phase. Once testing is completed, then it is time to add responsibility or management transfer.

Continue Reading the latest issue of Cornhusker Economics, published by the University of Nebraska-Lincoln Department of Agricultural Economics.

For more information on farm succession and transition, visit agecon.unl.edu/succession.