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Getting a Grip on Family Living Costs

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Getting a Grip on Family Living Costs

When discussing the financial aspects of a farming operation, the focus typically is on production costs, equipment, and cash rents. Yet, research has shown that over the past decade family living costs have increased more than these other aspects of a farming operation. Matt Davis, Vice President of Agribusiness at Farm Credit Mid-America says getting a clear picture on family living costs is key to a successful farming operation. “There is no one size fits all, no right number for family living costs,” he said. “What is important is knowing what those costs are so we can plan for them. I recommend that farm families put together an annual family budget so you can try and sick to that.”

Speaking on the Financially Speaking program on Hoosier Ag Today, Davis outlined the major traits that characterize a successful farming operation, “First, put together a production plan that fits your operation. Secondly, know all of your production costs including those fixed costs. Finally, have a budget for family living expenses so you can do a better job of meeting those expenses.”

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