Farm income: Where do you stand?

Farm Forum

According to Carl Zulauf, University of Illinois, “Average income of U.S. farm households has exceeded average income of average U.S. households every year since 1996.” This statement caught my attention one day and made me wonder-“Could this statement really be true?”

In the 2012 South Dakota Annual Report published by the Center of Farm/Ranch Management, the average family living of the farm was $64,307. Is this what farm families are truly spending on their living every year? What about your farm? How do you track those expenses to see what is truly happening and where the money is going? Is the farm actually giving the family $64,307 to live on every year? As I continued to study the information in Zulauf’s article and the 2012 S.D. Annual Report, a picture was quickly painted as to how this could be possible.

Let’s flash back a number of years. When I was young and working on my parent’s farm, all the men and women in our entire area worked on the farm, be it in the fields, raising a garden, cooking for the farm crew, or all of the above. The feed salesmen, bankers, or anyone else that had business with the farm could usually find someone on the homestead working.

That is not the case today. Many farm operators and/or their spouses work a job off the farm or out of a home office, with this income going to cover the family living expenses. Last year, producers in the Farm/Ranch Management program brought in an average non-farm income of $20,886 to help supplement the family living.

Looking at these numbers, 32% of the family living expenses of producers in the program comes from off-farm employment. Let’s take this one step further. If someone looks at the average income of farms across the nation, how will this impact the farm policies of the future? It is imperative that producers know what their actual farm income is and how their family living is impacted by this. We need to be advocates for agriculture by being able to explain how these numbers have been calculated, and what is the true story of income “down on the farm.” How is your operation doing? Are you in the average, above, or below when it comes to income and expenses?

You can reach Lori Tonak at 1-800-684-1969 ext. 7131, or