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Investing in Farmland is an Excellent Way to Build and Store Wealth

Farmland: Where the Wealthy Store Their Money

Higher net worth people know from experience that the key to growing and storing wealth is through leveraging real estate, particularly agricultural real estate. As the saying goes about land, “it’s the one thing they’re not making more of.” Many people with wealth prefer to store it in land, particularly farmland. As the global population continues to increase, so does the value of the land used to grow food for the planet. As the number of mouths to feed rises, farmland becomes even more essential.

The public often assumes that the wealthy keep their money in the stock market, and many do. However, investing in farmland provides several benefits, one of which is diversifying the real asset portions of their portfolios. Farmland gives the investor the ability to realize a gain in two ways: through leasing, farming, or share cropping the property, and through appreciation on the value of the land. When the income and the appreciation are combined, the return farmland delivers can rival many other investment choices.

Investments

Unlike some other investments, buying farmland is a long term, illiquid investment. For this reason, farmland investments tend not to suffer the volatility of the stock market. It’s a stable investment that has performed well over time. For example, during the past 48 years, farmland in the U.S. has yielded returns of 10% or better. More recently, during the period from 1992 to 2016, farmland yielded an even more impressive 12% return compared to real estate’s (NCREIF) 8.7% return, or the Russell Stocks Index 3000 which returned 8.8%*.

The simplicity of the idea of farmland investing doesn’t mean it’s simple to do. To maximize the creation of value through revenue, appreciation, or tax benefits, it’s helpful to have an experienced hand in your corner. The FCI team has helped numerous clients finance and acquire farmland as an investment. Contact us to discuss how you can take advantage of the inverted yield curve and the low long term real estate rates available for the best clients. We can help investors secure long-term, fixed rates for agriculture real estate in the 3%-5% range. Call today so that we can find the option that best fits your needs.

 

* “The Biggest Investment Opportunity You’ve Probably Never Heard Of.” Nav Athwal, co-founder and CEO at District. December 2018

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FSA Loans Helped Oklahoma Farmer Save $30,000 in Interest

Brian Rogers farms near Aline, Oklahoma, where he also provides mechanic services and runs a custom hay business to supplement his farm income. He went through a period of financial difficulty and needed some help to get through it. “With commodity prices the way they are, it’s a little tough on us little guys,” said Rogers. “Everywhere we can save money, it makes a big difference.” At the suggestion of his bank, Rogers met with Charlie Loomis of Financial Consulting, Inc. (FCI). The two met to assess Rogers’ situation, and together they came up with a plan.

FSA Loans Help Farmers Nationwide Save Money

The FCI team has a combined industry experience of over 40 years, and Loomis himself has been helping farmers and agri-business owners since 1999. From this base of experience, Loomis determined that refinancing existing debt could substantially improve Rogers’ position. “Charlie said that we could go through with FSA loans and get my interest rate down,” said Rogers. “We did that, and that move saved me over $30,000 a year just on interest. I would never have gotten the loan without Charlie knowing the ins and outs of the FSA loans. Pretty much everything he’s done for me has been a very, very smart financial move.”

Rogers continues to work with Loomis and the FCI team to get advice about financing his operation. “This year, I wanted to build a shop to be able to maintain my equipment,” added Rogers. “They were able to help me see how to make that work into my budget and make a little extra money. I’m a mechanic, so it just gave me another place to work and better place to maintain my equipment.”

Today, Rogers’ business is in a better place, and he gives a lot of credit to the FCI team. “My experience with everybody there is just fantastic, because I probably wouldn’t be in business without them,” Rogers concluded. “With him getting me the better rates, terms, it’s made the difference, like night and day. Charlie has sure helped me a bunch. We’ve had a very, very good relationship.”

FCI routinely assist farmers, ranchers and business owners get access to financing through programs like the USDA Farm Service Agency loan program, and find ways to increase liquidity and cash flow through smart financing and strategic relationships. To see how the FCI team can help you, contact us using the form, or simply call: (918) 762-2271.

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Struggling To Get Farm Financing You Need To Keep You Afloat? What Are Your Options?

farm financing

Running a farm is more than just a job; it’s a way of life. With a feast-or-famine workday and crop or livestock yields that can be wildly impacted by many factors outside your control, keeping your farm cash-flow positive all year long can often be a challenge.

For these reasons farmers can have a hard time accessing cash for equipment, livestock or even next season’s seedlings. If you’re like many farmers, you may feel like you have to jump through endless hoops just to access farm financing. However, understanding the different types of farm loans and the federal programs in place can help you secure the funds you need.

Continue reading Struggling To Get Farm Financing You Need To Keep You Afloat? What Are Your Options?

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Applying for a Small Business Loan? You Need to Know About These 7 Hurdles

Applying for small business loans can be frustrating, and according to some surveys, lenders reject roughly 66 percent of applications. Three of the most common obstacles to getting SBA 7a loans are poor credit scores, lack of business assets and no business plan, but beyond that, there are other hurdles in the process.

To improve your chances of getting your 7a small business loan application approved, you need to understand and avoid the following hurdles.

Continue reading Applying for a Small Business Loan? You Need to Know About These 7 Hurdles

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7 Tips to Save Money on Farm Loans

You’ve probably heard the phrase you need to spend money to make money. And whether you’re running a farm or any other type of business, that sentiment is largely true. However, in some cases, you need to borrow money so you can spend it.

Taking out a loan costs money, but there are ways to save. Take a look at these tips.

Continue reading 7 Tips to Save Money on Farm Loans