Twenty beginning farmers recently graduated from Practical Farmers of Iowa's Savings Incentive Program. Together, these farmers, who became the second class to graduate from the program, saved $47,000 to put toward building capital on their farms. The program matched their savings, for a total of $94,000 to be invested into Iowa farm businesses.
This, combined with the $40,000 invested with the first graduating class in spring 2013, brings the total money invested into beginning farm businesses by the Savings Incentive Program to $134,000.
To date, 29 beginning farmers have graduated from the Savings Incentive Program and 42 are currently participating. Of these, 20 have completed the first six months of their program and the other 21 have six months remaining until they graduate. Practical Farmers will open recruitment for another group of participants in August 2014. This will be the third class to enroll. The first class of Savings Incentive Program recipients enrolled in the program in 2010 and graduated in 2012.
Matched with a mentor, they have a business plan
The Savings Incentive Program was developed by members of Practical Farmers of Iowa to help the next generation of Iowa farmers develop successful businesses. Beginning farmers accepted into the program are matched with an experienced farmer mentor, attend events to help learn farming skills and create a business plan over the two-year duration of the program while saving money to invest into their businesses. Upon graduating from the program, the beginners receive business plan feedback from an industry expert, along with a savings match up to $2,400 to put toward a farm asset.
The savings and the match build the capital of these farms. Recent graduates used the money to purchase land, tractors, cold storage, tractor implements, high tunnels, fencing, farm vehicles, website development and more. Participants' farm enterprises are diverse, including fruits, vegetables, row crops, hay, beef cattle, dairy, poultry and other livestock.
Business plan, financial guidance, mentorship very helpful
Cheryl Hopkins operates Frog Hollow Farm, a 30-acre farm near Walker, Iowa, with her husband Mike. They raise Boer meat goats on pasture. "The program certainly helped us see the big picture of our farm," Cheryl says. "The business plan helped us see how it all comes together, especially with income, assets, expenses and cash flow."
She adds that the "mentorship was excellent" and she and Mike still keep in touch with their mentors. "We made lifetime friends with our mentors, Jim and Elly Fink, of rural Vinton. They have been wonderful, going above and beyond mentoring us on marketing, which was our original objective in working with them as mentors."
Cheryl says they used their program savings and match money to help purchase an ATV to check pastures and move fence. "Through EQIP (Environmental Quality Incentives Program), we are going to be dividing our pastures into smaller paddocks and doing more frequent rotations. The ATV will allow us to work with this system where we will be moving portable fences on a daily basis."
Encouraging beginning farmers is high priority for PFI
Practical Farmers of Iowa members designated beginning farmers as their highest priority in 2009, and the organization spent the next two years creating the program and raising money. An advisory group of farmers and business people helped create the components of the program it felt were most essential: combining learning technical skills with creating mentor and peer relationships; developing a business plan; and accountability to complete requirements through quarterly coaching from Practical Farmers staff.
Program will be opened to new group in August 2014
Through donations by Practical Farmers members and supporters and a federal Assets for Independence grant, the organization has raised $298,000 to match beginning farmers' savings and put toward building farm businesses. The match money is held in reserve at Lincoln Savings Bank, where participants all have free savings accounts. Lincoln Savings Bank has been generous with its business plan expertise, as well as its return rate on investment, allowing Practical Farmers to earn $4,970 off of the reserves – enough money to provide matches for two more participants.
To date, 29 beginning farmers have graduated from the PFI Savings Incentive Program and 42 are currently participating. Of these, 20 have completed the first six months of their program and the other 21 have six months remaining until they graduate. Practical Farmers will open recruitment for another group of participants in August 2014. For more information, visit the PFI website.