52 NEBRASKA CATTLEMAN January 2025 Herding Profits Strategic Financial Planning for Producers JESSICA MANION | FINANCIAL ADVISOR, FIRST INVESTMENTS & PLANNING, FNBO Producers often have varying cash flow and tax considerations when solving for their short- and longterm financial goals that need to be considered when planning. You continuously manage fluctuating market prices, production risks, environmental challenges with Mother Nature, and high equipment and maintenance costs. Not to mention, financial risks than can arise from situations such as lower-than-expected profits or higher cash demands for your family’s needs. Looking ahead, you realize how vital it is to plan for your desired life in retirement. For short-term funds earmarked for use within less than a year, money market accounts, CDs and U.S. Treasury Bills can provide safety without the volatility of stocks and bonds, and offer a decent return given our current interest rate environment. CDs and money market accounts (MMAs) offer higher interest rates than a regular savings account, so you can store excess cash today but have it available later to withdraw when seasonal operational expenses come back around. For example, if you know you will make an equipment investment in a year, you can set aside the money now and grow it within a CD or MMA account until you need to use it. For the best mix of higher interest rates and accessibility you can use both types of accounts, with an MMA having the flexibility of withdrawing early without penalties. For longer term goals, such as retirement planning, there are several planning strategies available that a producer can leverage in their program to build wealth. What strategy you use may change year-to-year based on your operation’s finances. Investment accounts such as traditional IRAs, simplified employee pension (SEP) IRAs, SIMPLE IRAs and solo 401ks CONTINUED ON PAGE 54 PERSPECTIVES
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