Poultry Farm Finances with John Hylton

The financial side of your farm is just as important as any other aspect. This week, we hear directly from a poultry banker on all things finance.

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00:57
Question 1: What if someone wants to get into poultry? How much does it cost to get it going?
The banks traditionally want 20%. This can be done in a few ways. Cash combined with land equity is a common approach, especially for generational farmers.

02:24
Question 2: How long should you finance your farm?
First, consider your long-term goals. The shorter your term, the lower your interest rate. Traditionally, a newer farm is going to be 15–20 years. Banks use that because integrators want you to do upgrades. A longer term means you build more equity, so you are better off when it's time to spend on upgrades.

04:34
Question 3: If you're debating between doing a shorter, 5 year term, versus committing for the long haul, it's difficult to know how to invest.
Having a relationship with your bank is one of the best approaches when it comes to assessing risk. Poultry bankers have worked with countless others who have faced unpredictable financial hurdles, and they can be your partner in helping you make the best decisions for you to be successful. That is their goal!

07:09
Question 4: What does it look like to refinance a farm?
If you have good equity in your farm, it's an easy, normal thing bankers do. Bankers can often take the estimated cost of those upgrades and roll the loan into your overall loan. Right now, in 2020, it's the best time to refinance because rates are at an all-time low, and they should be for the next year and a half or so.

08:47
Question 5: What are the tax breaks and benefits you can have for making upgrades?
Elections can greatly affect the tax outcomes for farmers.
The 10 year treasury has been fairly flat, so they expect things to remain the same. If you're in the market for an upgrade, make the most of the time right now!

10:59
Question 6: What can farmers do to plan for a financially stable future?
Talk to your banker about your future. Farms are very valuable assets, and bankers can help you avoid heavy taxing when you're ready to transition out of farming.

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[YoureNotReet]

My dad inherited 5 houses from his dad and built 2 of his own. The stress of always having to update the houses and the politics of the performance based system really took a toll on him. He was finally able to get out in late 2009 and start a new life. Unfortunately after selling the farm, leaving his hometown and building a new home for us, he died later that same year. Only 49 and was so unexpected. I know the years he spent as a chicken grower— the dirtiness of the job and crookedness of the companies themselves as well as the politics and favoritism killed him young. He never hesitated to discourage me from even considering to keep the family business going. And for that, I am eternally grateful to him. He didn’t get to enjoy much of his new life but I’m glad he was able to get out. Even if only for a little while

If you love your children, don’t let them become chicken growers

RIP DAD/SDC

[ijohnfornah]

Hello John thank you very for the programed Sir, i get every thing that you said it is a very fine programmed . if i many ask, if i may ask where to get help or finance my my chickens are dying. no money to buy and replace the lost one due to Most chickens who fall sick with COVID-19 will experience mild to moderate symptoms and recover without special treatment but others death along the line this is the reason for losing every thing

[nathankane]

john says it himself the farmer only builds enough equity to pay for upgrades, which leaves him back at square one only to end up in a vicious circle the banks know the farmers wont be able to pay it down so they make tons of money with the intergrator

[crazzyearl]

"rates will remain flat" this did not age well