Differences in the Determinants of Retirement Preparation between Farm and Nonfarm Households

Authors

Sheri L. Worthy, University of GeorgiaFollow
Travis Mountain, Virginia Tech UniversityFollow
Swarn Chatterjee, University of GeorgiaFollow
Carrie Johnson, North Dakota State UniversityFollow
Elizabeth Kiss, Kansas State UniversityFollow
Barbara O'Neill, Rutgers UniversityFollow
Lorna Saboe-Wounded Head, South Dakota State UniversityFollow
Michael S. Gutter, University of FloridaFollow

Abstract

As principal farm operators age, retirement and succession planning has become increasingly important to the U.S. agriculture industry. This study examined differences in the determinants of retirement preparation between farm and nonfarm households using the Survey of Consumer Finances. Factors such as risk preferences, financial capability, human capital, and other demographic characteristics of farmers that may play a role in their decision to plan for retirement were examined. Retirement planning was investigated by running three separate sets of logistic regressions on the overall sample, farm households, and nonfarm households. Likelihood of consulting a financial planner, expecting to leave a bequest, and household net worth were used as dependent variables. Results indicate some significant differences between farm and nonfarm households and highlight limitations in currently available data sets for studies such as this one. Implications for practitioners, researchers, and policymakers regarding farm family retirement and succession planning are discussed.

Recommended Citation

Worthy, Sheri L.; Mountain, Travis; Chatterjee, Swarn; Johnson, Carrie; Kiss, Elizabeth; O'Neill, Barbara; Saboe-Wounded Head, Lorna; and Gutter, Michael S. (2020) "Differences in the Determinants of Retirement Preparation between Farm and Nonfarm Households," Journal of Applied Farm Economics: Vol. 3 : Iss. 2, Article 5.
DOI: 10.7771/2331-9151.1048
Available at: https://docs.lib.purdue.edu/jafe/vol3/iss2/5