Keeping your farm financially strong

When I was an ag lender in Texarkana, Ark., I vividly remember the day I received news about the upcoming rains that would wreak havoc on the Red River and towns along its banks. 

Local farmers immediately took to their fields and pastures to do what they could prior to the cresting waters. They herded cattle to higher ground, reinforced levees and moved valuable equipment out of the flood’s destructive path. 

That day drove home for me that change can come when we least expect it – whether in the form of a flood, frost, disease, slashed grain prices, heightened input costs, etc. It also drove home the resilience, determination and resourcefulness of our farming community. Amidst all life’s changes, what I’ve hardly ever seen waver is the commitment farmers have to doing everything they can right now to make for a brighter tomorrow.  

Just like the farmers, I knew whose preparation saved their cattle, crops and equipment from flooding, there are financial steps you can take to help overcome future challenges. The below three tips will help you keep your financial footing – come COVID or high water.

First, think of relationships like a root system. The deeper and wider it is, the better. Remember, each person we meet knows something we don’t. Take advantage of the vast amount of knowledge right in front of you. Meeting with your neighbors, banker, accountant, extension agent and field tech will expand your knowledge and resource base, not to mention enrich your life. One of my best friends, who passed away in 2015, used to say, “Relationships are the only things we can take with us to heaven.” That’s always stayed with me.  

Next, plan. I frequently receive calls from my borrowers long before renewal season hits or well before they need new equipment. I can’t tell you how important that is from a financial perspective. Sure, you’ll always have those outlier years when a piece of equipment breaks down or you need to drill another well, but if you have a good plan in place, your banker will be ready to act quickly instead of scramble for solutions. Help eliminate tough conversations by keeping an open line of communication with your operation’s stakeholders. I promise your banker and accountant will appreciate it!

Last, invest – in your community, family and future. I always remind my farming customers and friends not to get so focused on feeding others that they neglect to feed themselves and their family. I get it, farming is hard, consuming work and it deserves our time and attention. But I’ve had conversations with several tenured farmers who wish they’d have slowed down a bit and enjoyed the little things a moment more. Food for thought.

Monte Elam is a community banker who helps oversee Simmons Bank ag loans for Searcy, Arkansas. 


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