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Whose responsibility is it to make farm financial decisions?

Whose responsibility is it to make farm financial decisions?

I’ll start off by saying this article is about an unpopular topic.

I knew it wouldn’t be extremely popular, so I have been a bit hesitant to publish it.

The topic below is a real problem that I see from farmer’s Facebook posts and more recently in conversations with Farming Without The Bank readers. Without further hesitation, here is the unfriendly, but real topic.

We as farmers, business owners, and hard working people, are blaming others for our mistakes.

I’ll call it conditioned blaming. It is a behavior that we have always done so we just keep doing it, it’s all we know.

Raise your hand if you’ve ever known anyone to have a long line of brand new stuff at the farm - with an equally long list of debt to go with it.

Did you shake your head? Did you wonder? 

Did you ask, “Why would you buy a brand new __(insert piece of equipment here)__ when you just bought one two years ago?”

You can put your hand down, you know who you are.

Did that same person answer “Well, I didn’t really need it but the banker told me I should purchase it.” 

Enter the age-old and somewhat classic blame game.


Who takes the credit for the purchase of a new tractor that the farm can't afford? 

A. The Banker
B. The Accountant
C. The Farmer
D. All of the Above



Depending on who you are you are going to answer that differently.

The banker is going to say the farmer.

The accountant is going to say the farmer and the farmer is going to say the banker and/or the accountant.

Me, well I am going to say D, all of the above.


The typical $7.00 corn scenario goes like this:


The farmer goes to see the accountant before the end of the year to determine what his taxes are going to look like. The accountant says, ”You may want to buy something to reduce your tax bill. If the bank makes you sell more grain to satisfy your loans you are going to need to do something.”


The farmer walks into the bank to do his year-end analysis and the situation is looking good.


The farmers says to the banker, ”If I sell all this grain I need to buy something to save on taxes.”


The banker says, ”If you need a tractor we’d be happy to lend you the money. With corn prices the way they are you won’t have any issue paying for it.”


The farmer then visits the implement dealer and comes down with acute new metal syndrome. He has to have it and he’s already approved by the banker and the accountant. Purchase made.


So who’s fault is it? The banker and accountant suggested he purchase it and he thought he had good reason. He needed to “save” on taxes.

Yet the accountant is only looking at the current year and how to save the farmer money. The banker is looking at money on hand and the projected year.

Neither of these two “advisors” are looking out more than a year when in reality they should be looking 5 years down the road. Unless of course, your accountant or banker is also a psychic. 

No one knows what five years from today looks like, but they should rely on what history shows.


History shows commodity prices go up and down, and in extreme ways.  If you’re a 2nd generation farmer or you’ve been in the Ag industry for more than 10 years - It’s hard to forget the 80s. The struggle was real, as the kids say. Banks must have forgotten the over lending that was done during that time period, accountants should recall the struggle the farmers had to survive during this time, and the farmer should not have forgotten the pain of almost losing the farm due to being over borrowed.


With all the being said the farmer, at the end of the day, needs to take ownership of his numbers.


Farmers are not accountants, and aren’t expected to be, but they do know their numbers and they do know their operation’s history of struggles in years past. Farmers know better than anyone how commodity prices fluctuate and how hard times can come to them over night.


Sadly, many farmers listen to the bank or the accountant for financial advice, yet neither the accountant or the banker are signing the check for the purchase/loan of that tractor. Their neck is not on the line, the farmer’s is.


You may not like my point here but it’s time for farmers to realize the bank and accountants are not looking long term, in most cases. They are only looking at a twelve month period of time.

Is the farmer 100% to blame? No. I believe it is a combination of all three. Each one needs to take ownership for their part. I’d love to see farmers look out for themselves and get more involved in their bookkeeping so they know what the future looks like when prices drop. 



What does the history of commodity prices tell us? Can the farmer make that payment or not?


If corn falls to $4, can the payment still be made? If not then don't buy it and ask why are two “advisors” recommending it be purchased?

Is the stress of not making a future payment worth the tax savings today or really the best purchasing decision long term?

Young farmers, bankers and/or accountants have no excuse either. You don’t have to be a farmer or in the Ag industry to know what happened in the 80’s. It was not that long ago and the stories of lost family farms are still fresh to many.  If you need a refresher, watch this 90 minute movie. 

More Scenarios:

This “Why did we buy that piece of equipment” subject came up with my own family.

I kindly reminded him, he signed the check and no one forced him too.

At some point we have to pay taxes. It’s not fun but it’s a sign you made money! I don’t like paying taxes any more than the next guy. I could have saved some money on taxes if I had bought something for my business, but I just didn’t need it enough to add an extra payment to avoid taxes and maybe save 30% on the item.

Had I bought something, I still had to pay for the other 70%.

If that doesn’t make sense, reference Chapter 4 in Farming Without the Bank and it will clear it up for you or talk to your accountant.


Let’s stop pointing fingers. Let’s start thinking how spending to save is not a good strategy.


We all need to take ownership and responsibility of what we are doing and if it’s not working look at a different way of doing things.


As always, it’s all about how you think. If you have questions about Farming Without The Bank or the Infinite Banking Concept and how farm families are using it to operate the farm and plan for the future, I am here to answer those for you by email or a phone call.

If you haven’t gotten the book yet, (It's regular $19.95 + tax and shipping)  scroll down for a quick purchase link! This tiny investment will help you understand the differences in how we use to finance the farm operation and how we need to finance the farm operation if we want to keep the farm in the family. 

Have a great day,



Mary Jo






















Mary Jo is proud to be a Certified Infinite Banking Practitioner helping family farms keep more of the profits, create financial systems, and bring financial clarity to an uncertain industry though correctly structured whole life insurance policies. 


Need More Information? Use these books and learn what tool can take away the worry.


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