FCSSW expands to offer a complete package of financial services

Like the large grocery store chains that offer more than food, Farm Credit Services Southwest (FCSSW) now offers more than agricultural loans. Through our agribusiness financial services department, you can obtain family business planning, individual financial planning and investing, crop insurance, credit life insurance, equipment and vehicle leasing, and appraisals.

FCSSW does not offer investment products other than crop, hail and credit life insurance. However, the Agribusiness Department can work with your existing financial advisers or can place you in contact with Money Concepts Capital Corp., a worldwide network of financial planning centers specializing in individual, family and business investment planning, to implement an effective investment strategy. Money Concepts is a member of NASD/SPIC, and is not affiliated with the Farm Credit System or Farm Credit Services Southwest.

"We've always wanted to do as much as we can for our customers. This allows us to do that," says Gary Dyer, FCSSW President and CEO. "With our agricultural knowledge and background we've always been able to offer agricultural loans but now we help implement the complete financial package through our contacts. I believe this is an important step for us."

Ken Lassen, Vice President of Agribusiness Financial Services, who has 22 years experience in banking, most recently with Wells Fargo, was hired in December 1999 to pull this new department together.
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I’m strictly here to sit down with customers and take the time to find out what their needs are,” he says. “We’ll find out what their plans are and what is important to them. In addition we’ll look over what financial packages they already have in place. If they are good ones we’ll leave them alone. In any event, we will work with the customer to develop a comprehensive plan.

“It is whatever will make a better financial picture for the individual or family. Farm Credit Services Southwest’s theme for the past 15 years has been ‘Together we’re growing stronger.’ We really believe this. When you are in the financial business as we are, you want to help your customers be as strong and prosperous as possible — not only today, but well into the future. These services are consistent with the stated purposes behind the Farm Credit Act — to help the agricultural community survive in a competitive economy.”

A complete package of services
Providing a complete package of financial services will help ensure Farm Credit customers are successful.

Financial planning and investing
We can help a customer plan for life events such as retirement, children or grandchildren's education, long-term care for aging parents, major future purchases and any other event that the customer needs to have accumulated funds to handle.

“All of our customers have some of these events coming up in their lives. Very few of them can handle these events out of their current income,” Ken says. “Selling the farm or ranch ‘someday’ is not as good a funding solution for these future events as traditionally thought.”

The best method, he advises, is to create and follow a plan that includes effective investments added to regularly from current income and insured properly against early death or unexpected injury and disability.

“It sounds simple but most customers have trouble getting started and staying on a plan. Some have already gone through this process but are unhappy with the results of their existing plan. While others have provided for some, or even all of these needs separately but have never looked at it altogether and organized it into a plan that works well as a whole. We can help in all these cases.

Family business planning
Family business planning is another financial service that we can be of help with. Toward the end of an active and successful career a new set of challenges comes to the surface.

“Who will own the business in the future? Who will manage it in the future? How would ownership and management change upon the death of parents or the current owner/ manager? These are all questions we ask and help families get answers to,” according to Ken.

Planning for a tax efficient transfer of assets and control is a major consideration but it is only a start, he says. In a family-owned business where the succeeding generation consists of all levels of agricultural interest and expertise, there are often difficult and sensitive plans that need to be made and followed.

“This program is really set up to take some of the discomfort out of planning for the future of the farm or business. Serving as a neutral third party we can organize and guide this process effectively for our customers.” The program looks at both sides, the parents and the children, and works with the family's legal and accounting advisors to implement an effective plan. “We might recommend forming a corporation and hiring and providing benefits to the children, such as a 401K plan, health insurance and profit sharing. Or another alternative might be to recommend setting up a joint partnership with the parents still in control but with the assets slowly moving to the next generation. Then when the parents pass on, the children own more of the operation and will deal with a smaller estate tax burden,” Ken says.

Whatever process is chosen, all sides’ requirements are taken into consideration. “It is a big search for the win-win for all parties. It is easier said than done but it’s so important for a successful transition between the generations.”

Rounding out our financial services package
We also offer:

• crop insurance
• equipment and vehicle leases
• appraisals

According to Frank Gray, Jr., Assistant Vice President of Agribusiness Financial Services, “We want our customers to be able to get everything from us. That’s why we’ve expanded our crop insurance program,” he says. “I’m fully licensed to sell property and casualty insurances along with our credit life and term insurance programs that we’ve offered to our customers.”

“We are very competitively priced and will get back to you quickly with a quote,” says Frank. “The question is, how much loss can the grower cover and how much loss is the grower willing to cover? We would like to help our members stay in business. Adequate risk management is many times a key factor of survival.

“When risk exists it is either assumed or shared, it doesn’t go away. Especially in the liability area, most farmers need the protection of sharing that risk,” he adds. “A prompt and fair insurance settlement keeps farmers and ranchers operating.”

Leases
Our leasing program is designed specifically for agriculture. Leasing offers tax advantages that owning doesn’t. Plus it doesn’t require a large outlay in cash. If cash is not in abundance and it’s needed more urgently in other phases of the operation then leasing is the way to go, according to Frank. “In addition, our vehicle leasing program offers fleet buying power, which means we can offer prices way below dealer invoice costs.”

Credit life insurance
Frank says, “Most want their business to continue beyond their life span under second-generation management and they don’t want their family members impacted negatively by outstanding debts. This product helps them reach both goals.”

Appraisals
According to Tom Schorr, Appraisal Program Manager, “High quality value estimations are needed for buying and selling transactions, estate settlements and general business planning. We have an experienced top-notch staff that specializes in agricultural assets. Our department devotes full time to staying current on the many changing market factors that go into an accurate appraisal. You just can’t buy that kind of quality service many other places.”

• Financial planning and investing
• Family business planning
• Is Estate Planning Worthwhile?
• Who needs a consultant?
• Financial calculator collection
  

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