Family wants to put money into my cattle. Urgent!

[SuperDave]

I have some family that want to invest in our heard (5) by adding some of there own. How do you guys handle this situation and is it worth it? What stipulations should I follow to protect myself? I really dont have a problem with it if i am going to be the main beneficiary. Other than that i dont want everyone to think im here to cowsit everyone's investment. Of course i want a positive return every year, but if its not worth the hassle of using someone else's money i will pay for it all myself. Please reply any comments as they are all helpful. I listed this urgent because we have family in town now and i just want to have some suggestions face to face with them. I am getting the feeling that maybe i could be taken advantage of without everyone's good advice on this board, so thank you in advance everybody.

 

[MikeC]

Got neighbor that owns the land and his family has a few cows alongside his.
He charges them $1.30 per day for each cow, weaned calves at $1.00 per day, replacement heifers start at the $1.30 rate after one year of age.
The landowner furnishes all bulls, feed, mineral, shots, etc.

 

[Campground Cattle]

Got neighbor that owns the land and his family has a few cows alongside his.
He charges them $1.30 per day for each cow, weaned calves at $1.00 per day, replacement heifers start at the $1.30 rate after one year of age.
The landowner furnishes all bulls, feed, mineral, shots, etc.

Sounds like a real smart fellow I would say get it on paper to.

 

[ollie]

Tell them your not interested. It is a commodity business with very low ROI and lots of labor. They won't understand when they don't make money. Those situations also make for very complicated tax returns. They might want to keep a heifer then it is %yours which makes it worse. If you love your family tell them no. If you have money and time you're mad at then by all means go ahead.

 

[Arnold Ziffle]

Superdave, a very wise business man told me many years ago that "the best kind of partnership to have is one with only one partner". Over many years I have come to learn that his comment was not merely a humorous quip. I'd be especially careful about being in any form of cattle partnership with family members. But of course you're the only one here that really knows the family members potentially involved in your business and how they may react in various situations. Potential rewards may be a lot less than the risks of hurt feelings (at the least) and family acrimony. I wouldn't have partners, family or otherwise, unless I really needed them or unless I could expect significant benefits, synergy, etc. therefrom. All just IMHO.

 

[jt]

Tell them your not interested. It is a commodity business with very low ROI and lots of labor. They won't understand when they don't make money. Those situations also make for very complicated tax returns. They might want to keep a heifer then it is %yours which makes it worse. If you love your family tell them no. If you have money and time you're mad at then by all means go ahead.

i agree... and unless it was a very special situation, i wouldnt partner with anyone... many times people dont understand the cattle business.. they tend to think you are making loads of money.

jmo

jt

 

[dun]

Tell them your not interested. It is a commodity business with very low ROI and lots of labor. They won't understand when they don't make money. Those situations also make for very complicated tax returns. They might want to keep a heifer then it is %yours which makes it worse. If you love your family tell them no. If you have money and time you're mad at then by all means go ahead.

i agree... and unless it was a very special situation, i wouldnt partner with anyone... many times people dont understand the cattle business.. they tend to think you are making loads of money.

jmo

jt

Having partnered several times in the past, I'll never do it again. Concerning family members, I have told them we weren;t interested. Basicly the same thing others have been telling you.

dun

 

[Crowderfarms]

I would'nt touch a deal like that with a ten foot pole. It will not have a happy ending.

 

[Ryder]

Who is going to make decisions?
Do they understand potential for loss?
Do they understand that if unforseen calamities occur they may have to come up with more money?
Do they absolutely trust you to believe what you tell them about management, expenses, etc.

All of us that have had partnerships go bad went in with good expectations-but it didn't turn out that way.

 

[Susie David]

Dave...it sure sounds like your family wants you to take care of their cows for them, you do all the work and they get the reward. We told our family the we're in the business of selling beef cattle and would gladly custom finish steers for them...@ $2.00/lb on the rail. We do make exceptions for one daughter, they work on the farm in exchange for beef at the same $$. Our arrangement keeps the family happy and our finishing pen full. Susie

 

[stocky]

There are lots of situations where family members see cows and grass and think they could add a few and it wouldnt make any difference. I have a neighbor that his sister and her husband wanted to have a couple of cows there to raise a beef each year. Their cow or two has turned into 10 animals and they quit paying for feed and upkeep a long time ago and get ticked off at my neighbor when he brings up they owe him money. Now they are upset with me, because I bought my neighbor's cows and rented his whole farm and I told them that their cows are now eating grass that I have paid for. They have the choices of paying me rent, moving their cows, or keeping them in a pen and buying hay for them (I also bought all of my neighbor's hay). 10 cows are a little too much for me to just let them freeload, they arent my family. I agree with most on the board, this will only cause you extra work, expense, and hard feelings between you and them in the long run.

 

[SF]

Walk away superdave.

 

[WORANCH]

Just say no .

 

[Bama]

I do this with my son.The record keeping is a pain in the butt. Tax time is also a pain. But in my case it is worth it. My son is only 12. I'm doing it to get him established in the business. My son buys his own cattle. They stay with mine. At sale time when he recieves his check he pays me for feed only. I don't charge him for pasture improvments, med, or all the other stuff that goes along with it. No way would I do this for just anybody. The only way I would do it was at a set stocking rate. With everthing on paper.

 

[Crowderfarms]

I do this with my son.The record keeping is a pain in the butt. Tax time is also a pain. But in my case it is worth it. My son is only 12. I'm doing it to get him established in the business. My son buys his own cattle. They stay with mine. At sale time when he recieves his check he pays me for feed only. I don't charge him for pasture improvments, med, or all the other stuff that goes along with it. No way would I do this for just anybody. The only way I would do it was at a set stocking rate. With everthing on paper.

Bama, got room for another Son? :lol:

 

[SuperDave]

thanks everyone, thats kind of what i was hoping to hear. I am very new to this and this kind of help is greatly appreciated. Some of you all like Dun might remember me under a past name that i used but couldnt pull back up, then it was "Okmike". i havent been on the boards in a while because i have finally moved home from college like i planned and now i am in the driver's seat on the family farm ( due to family loss ). Things are going slow but well thanks to good neighbors and all of you on here, you are all good people. thanks.

 

[Bama]

I do this with my son.The record keeping is a pain in the butt. Tax time is also a pain. But in my case it is worth it. My son is only 12. I'm doing it to get him established in the business. My son buys his own cattle. They stay with mine. At sale time when he recieves his check he pays me for feed only. I don't charge him for pasture improvments, med, or all the other stuff that goes along with it. No way would I do this for just anybody. The only way I would do it was at a set stocking rate. With everthing on paper.

Bama, got room for another Son? :lol:

I told this one when he gets up to 25 head he has to start paying everthing. I can't afford another one. Funny thing I also have a 15yo daughter that gets the same deal. She don't realize just how good a deal it is. He on the other hand is taking advantage of it.

 

[1848]

Bama,

Was glad to see someone take the other side. I always heard.."don't mix family or friendship with money", but family and friends should come first, not the pocket book. There is allot of truth and, I'm sure, experience in what everyone says, but you have to give to get, can't have friends without being one, and you should always try to leave the next generation better off than yours.. My kids cattle is mixed with mine too. The have their own breed numbers, and their cattle generations are putting them through college...

but...SuperDave,

You could ask for 50% of the calf crop, complete management of the herd and breeding decisions. Plus, the other owner pay for veterinary cost associated with his/her animals. Otherwise you provide pasture, normal care, finances, and of course supply an annual report... ;-)

 

[Bama]

Actually I wasn't taking the other side. I do this for my young kids just to get them started. I think they are learning a valueable lesson ( at my expense ). My 12 year old son has picked at me. He's got it figured to where he makes more with 24 than with 30. I told them up to 25 then they had to pay all expenses. I ain't rich by anymeans. I have just tried to raise my kids to where they know what a honest days work is for a honest days pay. I think this gives them a head start at being adults. I gave each of them a calf and loaned them the money to purchase a second one. They have had to take the profit off of those first two and reinvest to add to their herd. I would not mix family and business with anyone other than my wife and kids. Even with the kids they have to help with the chores that comes along with the operation. My son can outwork a lot of the guys I work with on my dayjob. I still let them be kids. I let them do things normal kids do. They just don't lay around all day playing video games. They do play, but after the chores are done.

 

[Crowderfarms]

Actually I wasn't taking the other side. I do this for my young kids just to get them started. I think they are learning a valueable lesson ( at my expense ). My 12 year old son has picked at me. He's got it figured to where he makes more with 24 than with 30. I told them up to 25 then they had to pay all expenses. I ain't rich by anymeans. I have just tried to raise my kids to where they know what a honest days work is for a honest days pay. I think this gives them a head start at being adults. I gave each of them a calf and loaned them the money to purchase a second one. They have had to take the profit off of those first two and reinvest to add to their herd. I would not mix family and business with anyone other than my wife and kids. Even with the kids they have to help with the chores that comes along with the operation. My son can outwork a lot of the guys I work with on my dayjob. I still let them be kids. I let them do things normal kids do. They just don't lay around all day playing video games. They do play, but after the chores are done.

Bama, keep doing what you're doing. It will pay you and your kids back 1001% We do the same thing here. Wish everyone thought this way that is bringing kids up on a working Farm or Ranch. ;-) I feel to grow up this way is a dying tradition.