1.
Can Farmers Ever Afford
to Retire?
Dr. Barbara O’Neill, CFP®, AFC®
Extension Specialist Emeritus, Rutgers Cooperative Extension
Owner/CEO, Money Talk

2.
How Do You Picture YOUR
Retirement?
What Will You Do and
Where Will You Live?

3.
Common Retirement
Income Sources
for Farm Families
NOTE: Not every
farm family will have
every source of
retirement income!

4.
1. Social Security
• You need 40 credits (10 years) of work and must be
age 62 or older
• Benefit based on 35 highest earnings years
• Delayed retirement credits between full retirement
age (FRA) and age 70 will increase benefit

5.
2. Off-Farm Job
Employer Benefits
• Pension
• 401(k), 403(b), 457 plan, and TSP “salary reduction
plan” savings
• Other employer benefits (e.g., health insurance)

6.
3. Rental Income
• Land
• Buildings
• Equipment
• Animals
• Other

7.
4. Individual Retirement
Account (IRA)
• 2023 maximum contribution of $22,500 (under age 50)
and $30,000 (age 50+)
• Two types: Traditional (pre-tax dollars) and Roth (after-
tax dollars)
• Can select a variety of investments (e.g., stocks, bonds,
mutual funds, exchange-traded funds, bank CDs)

8.
5. Simplified Employee
Pension (SEP)
• Retirement plan for self-employed individuals and small
business owners
• Deadline to set up: on or around April 15 of following
calendar year (i.e., the tax filing deadline)
• Contribution Limit: 20% of net self-employment earnings
• Must fund for eligible employees (up to 25% of gross salary)

9.
6. Investment Income
• Interest
• Dividends
• Capital Gains
• Mineral rights
• Other

10.
7. Continued Income
• Payments for crops
• Payments for animals
• Agritourism income
• Salary from an adult child or other new farm owner
• Income from non-farm related work

11.
8. Income From the Sale
of Farm Assets
• Farmland Preservation program funds
• Income from invested farm sale profit

12.
RCE Later Life Farming
Online Course
https://laterlifefarming.rutgers.edu/

13.
Any Questions?