Friday, March 29, 2024

Wealth not most important thing

Neal Wallace
The financial hurdles of retiring from a farm have been well studied but less so the emotional impact on rural people once they leave the land. Neal Wallace speaks to a Dunedin financial adviser who has completed such a study.
Reading Time: 3 minutes

A study into life after farming appears to counter some common views about priorities for couples leaving their farm.

Rhodes Donald, a director of Dunedin wealth management firm Polson Higgs Wealth Management, has surveyed 20 retiring or retired farming couples and 10 professional farm advisers from Otago and Southland, which revealed health is their number one priority in retirement with financial security ranking fourth.

“Farmers max themselves out to accumulate wealth when there are more important issues,” he said

The second priority for retirees is relationships followed by having something meaningful to do.

The two-year study involved in-depth interviews covering topics that compared how people have transitioned from farming to retirement and what constitutes a good life after farming.

Of the group interviewed 60% had sold their farms and 40% had entered in to a succession arrangement.

The interviews covered how they entered farming, their lives as farmers, mental health issues, off-farm investments, moving off the farm, life in retirement, what worked and what they learnt.

Donald said some couples could be retired for up to 40 years, longer than they farmed, so planning and preparation for life after farming is important. 

He urged couples not to leave it too late because change becomes more difficult as people age.

He gave the example of hearing aids. They are more likely to be worn when people are young and when they are needed rather than when people are older.

“If it is needed when in your 50s, get it and get used to it. If you don’t get used to it, it sits around in your drawer.”

While there are no rules, most people are still active from ages 60 to 70 – what Donald called the go-go years — but slowed aged 70 to 80 in the go-slow years  and the years past 80 were, for most, the no-go years.

“Don’t leave the bucket list until you are 70. Do it now.”

The study unexpectedly revealed strong emotional links for wives and daughters to the family farm compared to husbands and sons.

Daughters were leaving a home they had grown up in and once sold they could not take their children to visit.

The study found 25% of wives had some sort of bad experience trying to fit into a new community on retirement.

Interviews showeed many had moved to a district when they married and built up a nucleus of friends who had also moved there.

They all had children at a similar time, served on community groups, clubs and organisations but when they moved away when they retired many struggled to recreate that glue in their new community.

Individuals responded differently to the pressure of leaving the farm so care had to be taken to ensure everyone coped. 

Planning the shift at least five years in advance makes it easier.

People adapt to what financial resources they have but it is more important for retiring farmers to look after their health, broaden their interests and hobbies to activities outside farming and communicate.

“It starts with their spouse but it can’t stop there. You need to be good at communicating with your children.”

That is vital because decisions are made about the farm, which is also the family home.

Te study showed the importance of diversifying interests, hobbies and skills to improve quality of life. They included learning to cook, to write and to keep up with technology. 

Interests should include activities that did not require physical strength and couples should have joint as well as separate interests.

“Respected studies say it is important to have things in common but also interests outside the relationship.”

It also ensures that when one partner dies the survivor has a network of interests and hobbies to pursue.

Donald said there is ample financial information and advice available to people to prepare for retirement but not so much for the physical and emotional shift.

“Investment and the money side we have got pretty much sorted. There are no frontiers left to break. 

“The interesting part is people’s lives, what constitutes a good life and helping people to sort it out.”

Couples need to have financial security for at least 30 years so should not give away money to the family and sell themselves short. He also advised farmers to invest off-farm.

The interviews showed retirees are proactive with their health and do research to ensure they have healthy diets, plenty of sleep and exercise and moderate their lifestyle accordingly.

“They don’t leave good health to chance. They work at it.”

They also regularly update reading glasses and hearing aids so they keep the ability to communicate and are active.

A wide network of friends of different ages is also as important as learning new things every day and regularly meeting new people.

Children should not be pressed to go farming. The survey showed the importance of educating them well and encouraging a wide pursuit of interests.

The social aspects of rural life interests Donald and he hopes to embark on studies as diverse as farmers’ dependence on the weather, what he calls an almost spiritual relationship, the health of rural people and to look deeper at women leaving the farm.

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