Imagine what it takes to farm 2,500 acres and care for 400 head of livestock. If you can’t, you probably wouldn’t do so well in Steve Bohr’s company, Farm Financial Strategies Inc. You see, Bohr caters to farmers across the Midwest who want to pass their farm and agricultural legacies on to their children.
Bohr began work as a “professional manure hauler and fence builder” as the youngest of five children on that 2,500-acre farm near Cedar Rapids, Iowa. It was his dream to preserve that farm for future generations. He saw that the heritage of the family farm was disappearing under the inevitable burden of time and statistics: 65 percent of the farmland in the Midwest is owned by farmers who are 60 or older. That means in 15 to 20 years those farms and millions of acres of land will be passing hands. If they don’t go to the next generation, they will end up in the hands of large corporate operations.
Bohr’s calling is to help farm families avoid that fate. He was instrumental in getting the Farm Financial Strategies program off the ground at the ING agency where he began work as an advisor. That program blossomed under his care, and in 2003, he formally established his own company, Farm Financial Strategies Inc. Bohr and the 21 people who work in his business—all with agricultural backgrounds—offer farm continuation and estate planning to their 1,800 clients in seven Midwestern states. Over the last 15 years, Farm Financial Strategies has helped ensure that 5,000 farms stay in the family. In the process, it has reduced or eliminated $350 million in shrinkage from future estate transfers and placed in force some $300 million in life insurance.
Get the profile right
Bohr attributes his success to a business equation that rules his practice, and that equation starts with a client profile—a very specific profile: a 60- to 70-year-old widowed farm operator, with a son or daughter who wants to take over a farm with 400 or more acres.
“If you give me that individual, four times a day, the sky’s the limit,” says Bohr. And he manages to do just that: He sees a farm owner four to five times a day, on those days he has slated for appointments, starting at 7 a.m. This is all in keeping with the guiding principle of his business, “Learn a lot about a little, and go out and do a lot of it.”
With an acre of farmland bringing in around $3,600 if sold, but only $200 a year of profit if worked, the temptation to sell can be strong. That is, until Bohr brings in a solution in the form of an estate plan. He keeps his product portfolio small, with life insurance—only fixed products—at the center. The plan he and his associates craft allows for the parents to retire with income, the heir to take over the farm, and the nonfarm siblings to get their fair share of the inheritance—all for the equivalent of, in farm terms, about $25 to $50 an acre worth of premium, says Bohr.
In addition to his business, this 37-year-old past president of Cedar Rapids AIFA runs his family farm and is home with his family by 5 p.m. He accomplishes this by scheduling his days well in advance and color coding them so he stays on track: 148 green days a year are for appointments, 30 red days are for business-related red tape and four blue days are for strategic planning. The rest are yellow days, which belong to him, his wife Jennifer and three children. Yellow days are also planting and harvesting days, when you just might find him at the wheel of a tractor, somewhere on the 2,500 acres of the farm he helped preserve.