Money Mentor: how to pass on the family farm without causing a rift

Question: Our son is getting ready to take over the family farm, which I’m delighted about, but we are unsure how to treat my other children fairly. Most of our wealth is tied up in the land and the business, so dividing things equally isn’t straightforward. We want to keep the farm viable for the next generation, but I also don’t want our other children to feel left out or undervalued. How should we approach this, so everyone feels respected and the farm has a sustainable future?

Answer: One of the hardest conversations on any family farm is not about cattle prices or quotas – it is how to pass the place on without leaving bruises behind. Farming families face a unique challenge, because the farm is both a business and a legacy, and in most cases the wealth is tied up in land, stock and machinery. You can’t divide a farm three or four ways without destroying the very thing you’re trying to pass on. So, the real task isn’t to divide everything equally, but to create a sense of fairness, and fairness doesn’t always mean sameness.

Finanically viable

The first principle in any succession plan is that the farm must remain financially viable. If the successor takes over a holding that’s been carved up, heavily borrowed against, or stripped of working capital, you’re not passing on a livelihood, you’re passing on a burden. Protecting the farm as a going concern is not favouritism, it’s responsible stewardship of an asset that may have taken generations to build.

At the same time, it is understandable that parents worry about non-farming children feeling excluded. In many families, there can be a perception that one child is “getting everything.” However, context matters. Often the farming child has committed years of labour, lower earnings, and personal sacrifice to keep the business going while siblings pursued careers elsewhere. Recognising that contribution is part of fairness too.

But fairness isn’t just financial. It’s emotional. The biggest source of resentment in farm transfers isn’t the outcome – it’s the process. Children can accept different inheritances if they feel respected, informed, and included. They struggle when decisions are made behind closed doors or revealed at the last minute

There are practical ways to create balance without damaging the viability of the business. One option worth considering is allocating a site or some road frontage land to non-farming children, particularly where planning potential exists. A modest parcel of land for a home can carry both financial and emotional value. It allows siblings retain a connection to the home place while not undermining the commercial scale of the farm itself. Naturally, this needs careful tax and planning advice before any transfers take place.

A site isn’t the full answer, of course. Some children may already own homes elsewhere or may not want to build. Others may feel that a site, while valuable, doesn’t equate to the scale of the farm being transferred to their sibling. That’s where financial planning tools can play a powerful role.

Life cover

One of the most effective is whole of life cover. Unlike term insurance, which expires after a set number of years, whole of life cover pays out whenever death occurs. This makes it a reliable way to create liquidity for the non-farming children. The farm passes to the successor. In practical terms, the farming child inherits the business, while the insurance proceeds provide a financial inheritance for the other children. This avoids putting pressure on the successor to borrow heavily or sell land to fund payments to siblings.

The premiums can be structured in a way that’s manageable during your lifetime, and the payout can be calibrated to reflect what you feel is fair – not necessarily equal, but fair. For many families, this combination of a viable farm, a site and a guaranteed financial benefit strikes the right balance.

Family resentment

But fairness isn’t just financial. It’s emotional. The biggest source of resentment in farm transfers isn’t the outcome – it’s the process. Children can accept different inheritances if they feel respected, informed, and included. They struggle when decisions are made behind closed doors or revealed at the last minute.

That means discussing plans early and clearly. Explain why the farm needs to remain intact. Explain the thinking behind sites, savings, or insurance policies. Acknowledge openly that arrangements may not be strictly equal, but that your intention is to create fairness while protecting the future of the farm.

These conversations are rarely easy, the most important step is to communicate early and clearly. Explain why the farm needs to stay intact. Explain the logic behind the site or the life assurance. Give each child space to ask questions and express concerns. You don’t need unanimous agreement, but you do need understanding.

Martin Glennon is head of financial planning at ifac, the professional services firm for farming, food and agribusiness