Re-Generational Wealth

Ranching is a life style. Hard, dangerous, dynamic, amazing, and supremely awesome. Everyday we encounter life and death choices on the ranch and find ourselves making decisions that will impact not only our immediate family, but generations to come. From creating grazing plans that will one day return our pastures to native grass species, to choosing the correct grazing animal genetics, to pricing our grass fed and finished meat, each decision we make creates a ripple that floats through time. How those ripples land on the shore is the focus of this article.

At nearly 50 years old, I am the sandwich generation. I have children in their teens and parents in their late 70s. Together we work this land to create a legacy for the coming generations. One of the most important concepts that we face as a family is profitability. If I hope to create a legacy with my parents and children to leave to my grandchildren, I have to build a profitable business here on the ranch. Having lots of animals is fun, but without a solid financial plan our resources diminish and our animals go hungry. It’s not enough to just want to be here, we have to plan to be here for generations.

Part of the solution to that plan includes all of the key concepts of regenerative agriculture. We rotate our animals, minimize our soil disturbance (no tilling, and no application of chemicals), attempt to keep a living root at all times in our pastures, maintain diversity in the species of plant and animals, and reduce the length of the food chain to just us and the end consumer. All of these principles work in unison to keep our ranch profitable and functioning in a way that creates a positive impact on our environment. It is far more than just sustainable. Our ranching principles regenerate our physical environment and build on top of what we inherited from the previous owner of our property.

The rest of the solution is more ephemeral. It’s elusive, invisible, and hard to track because it’s almost taboo. It’s how we handle our finances.

Most ranching families, and most families in general don’t discuss finances with each other and certainly not with the world in general. Many times the ranch is left without a will or trust and the government gets involved happily taking their very large cut and leaving the family needing to sell the beloved ranch just to pay the tax.

At Chantilly Ranch we take a fully opposite approach to tradition. We talk openly about finances, make family decisions together and create processes that will benefit many generations down the line. One of the biggest deviations from traditional financing we use, is the creation of a family banking system. We use properly structured whole life insurance policies as our savings tool and in time will be free from the need for external financing of any kind. Our plan is to have all of the ranch’s financing needs be fulfilled by our own savings in the life insurance policies.

We are able to store our cash reserves there, allowing them to grow with compounding interest. Then we are able to use those reserves as collateral for loans we can take against them from the life insurance company, not outside banks or lending institutions. In this way we are able to capitalize on the use of our savings without actually having to use our savings. Through the use of life insurance, we have now created a substantial inheritance for the next generation in the form of a death benefit, and we are able to fund the opportunities that ALWAYS arise on the ranch to increase our business.

We have created an entirely self directed banking system, cutting out the lending institutions, and growing our wealth in a tax free environment that is accessible to our whole family. Having this kind of financial transparency, ultimate control, and decisions that start and end within the family, fortifies our position and includes our children in the decision making process.

There are many things that keep me up a night but trying to figure out how to make this ranch attractive to the next generation to come work on it is not one. They will have the opportunity to use their education, experience, and interest to make a life here on the ranch.

You can find more information on how to build your own family banking system (not just for ranching families) here