Planning ahead financially is just as important as planning the next crop or livestock purchase. Tompkins State Bank Senior Vice President Chris Rennau, encourages farmers to lay out cash budgets:
“Farmers know what their numbers are. What I always like to persuade them to focus on, is not just knowing what your numbers are, but knowing how those costs behave under different scenarios. Agriculture is unpredictable and it goes in cycles. It is a good idea to know and understand how your costs behave. There are all kinds of different scenarios that can happen.”
As multiple factors can impact operations, Rennau recommends laying out several projections for the year that cover different scenarios.
