Retirement Plan Options for Farmers

By: Shawn Williamson

Some farmers love what they do so much that they intend to do it until the end. Others would like to retire for health reasons or to have time for other interests. A portion of retired farmers will be able to live comfortably on the combination of farm rents and Social Security. If that won’t work for you, consider establishing and funding a retirement plan.

Establishing an official retirement plan can help you save on current or future income taxes. You can always invest unlimited after-tax dollars into certificates of deposit, stocks, bonds, mutual funds, and so on. However, that doesn’t improve your tax situation. (One exception would be investing in municipal bonds, for which interest income is federally tax exempt.)