Good morning Keith,
That is actually a good point to bring up. My grandparents made a living but probably a good one for the dad. Granddad died in an accident back in 1939 and my Grandmother ran the farm with her eldest son (13 or 14 at the time) and there were 8 kids in the family. I think they had 6 1/4's at the time, close to 1000 ac and that was a very big farm at the time. But the problem was lots of assets and not so much cash. But it appreciates, my unlce takes it over and now it is 2500 ac. He makes a better living and has good cash flow. It has appreciated massively. Back in the day a 160 acres might cost $800 or $1000 for very good land. Now it sells around here for about $150,000 and this part of Alberta has the least expensive land in the province. So you can see how while not necessarily Enzo range, my uncle could roll his farm for 3 mil plus equipment and his retirement would be pretty good.
I can remember when we moved here in 1979 and the cash was tight as we were setting up a farm. We had one vehicle for the family to use. Now almost 25 years later even I have two pickups and two cars, my parents two pickups and a van (and a slew of beaters too) and it is a different situation. I appreciate my good fortune to be in a family that has benefitted from appreciation so much and the opportunity that it will give to me and to my son in the future. His standard of living will be assured unless he royally screws up. While with mine and my parents farm in his posession (1500 ac) he will not be able to rent it out and retire, now it could generate $45,000 of pure rental income, more so when my son gets it. Imagine having your regular job and another $60 K coming in yearly for having done nothing yourself but being in the right place, right time, to take advantage of what the previous generation built up.
My challenge will be to make sure that he still proceeds with life, goes to university and gets a career he will enjoy and that this will be icing on the cake for him to have in his life. Sort of a legacy for the family to benefit from regardless of what they elect to do with their lives. The farmland can generate a good income stream to produce a more comfortable life.
It is a situational thing. It didn't have to go this way re land prices but it did and farmers are just experiencing something currently that previous generations of farmers could not have ever imagined. Most of them sadly do not deserve it or appreciate it. I had a uncle with a grade 3 education and while he may have worked hard in his life died with about 6 to 8 million plus set up his two oldest sons in farming operations. I can't think of too many occupations or jobs/professions under which that would have occured. Yet to his dying day he griped and bitched about how "the lowest paid person in the world is the farmer"!!!!! But then again he never had a job job or worked for anyone else to experience what most of us do with job. Most of us don't get to call the shots and end up in servitude to someone else for life............
My one cousin failed out of university as an engineer, accountant and finally got a degree in education. Never worked at any job in his life, his dad set him up with a farm and he likes to think that he accomplished this on his own rather than understanding that it was handed to him. Their kids are the same way. The eldest boy is 22, failed at university, works for his dad's accounting company and farms with him. He brags about how he buys land and pays $200,000 for a combine to his cousin and its kind of like, uh no, your dad is backing you at the bank on this otherwise the bank wouldn't touch you! A 22 year old without an education, a solid professional career and a s**t load of assets is not able to borrow money like that from any bank I'm yet aware of!
It is not that it is bad or wrong to have the good fortune to be born in a lucky family situation. What pisses me off is people (a lot of my relatives) who think that they created this situation of a financial windfall on their own rather than it being simple situational dumb luck.
Cheers,
Garry
