Did you know that there are about 276,000 woodland owners in Wisconsin, and according to a Wisconsin Department of Natural Resources study, about 60% are 55 years or older? About 49% of woodland owners are already retired. In addition to planning for your retirement, are you planning for the future of your woodlands? Believe it or not, they go hand in hand. Planning for your financial future and long-term care involves your woodlands. And planning for the future of your woodlands can help ease any financial burdens on your heirs and keep your woodlands intact.
Yup, another entry on the importance of planning, however, this one involves people, not trees. Did you know that there are about 276,000 woodland owners in Wisconsin, and according to a Wisconsin Department of Natural Resources study, about 60% are 55 years or older? About 49% of woodland owners are already retired. In addition to planning for your retirement, are you planning for the future of your woodlands? Believe it or not, they go hand in hand. Planning for your financial future and long-term care involves your woodlands. And planning for the future of your woodlands can help ease any financial burdens on your heirs and keep your woodlands intact.
In a previous entry, we discussed the importance of communicating with your family about your and their wishes for the family woodlot. Having an estate plan does not ensure that your dreams will be continued, nor does it ensure family peace and harmony in the future. Engaging your family in the estate planning process goes a long way to ensuring a more successful transition. We offer classes that assist in succession planning, check out Ties To The Land classes around the state and in the Minneapolis area this year.
It is important to provide your family and professionals you may hire with all the information necessary for making important decisions. Is there a remaining mortgage payment? What are the annual property taxes? Is there potential income from timber sale or other uses from the property? Are you enrolled in the state Managed Forest Law program? Provide copies of any forest management plans and maps of the property. Be realistic on the costs and income from your woodlands.
Clarify, with your family and professionals, your goals for the property and your life. You need to take into account any potential external circumstances that may influence decisions about your woodlands. For example, it is possible that some family members may not be able to afford the woodlands. Also, there may be unequal interest in retaining ownership of the woodland. Many of these goals and objectives may define how the property is owned in the future. There are a variety of ownership options including business structures (partnerships, LLC, corporations), gifting the property over time, land trusts and conservation easements, and living trusts, to name just a few.
Put together a team of professionals to assist you with this process. This team, at the simplest, should include an attorney, an accountant, and a forester. At best, they should all be familiar with forestry issues. You may also want to include trust officers and financial planners. If you need assistance with family dialogue, you may also wish to include a professional facilitator or someone from outside the family to assist with family conversations. We tend to be more polite to each other in the presence of strangers.
Once you understand your family’s goals and needs, the financial situations, and the potential ownership options for your situation, it’s time to write your estate plan. Unfortunately, you don’t get to sit back once it is completed. With any changes in life situations, it should be reviewed and modified as needed.
Through our Ties To The Land classes, we have heard many stories about what happens when landowners don’t plan. Succession will happen whether or not you plan for it, and many times with unfortunate results. You have the opportunity to ensure that your legacy is a positive one by actively planning for the future of your land.