I grew up in a small town in an agricultural community — but my family was not involved in agriculture. Nevertheless, I always dreamed of owning a ranch.
So you know I haven’t been living on a trust fund for the last twenty years, here is a list of jobs I have had: Marine, wildland fire fighter, retail worker, night shift security guard and grain buyer at a grain elevator.
I held my last job for eight years while building a ranch from scratch with three heifer calves. That little ranch grew into what has become my “fulltime” career – with 220 cows (and growing). Many of these cows are registered Pharo Cattle Company cows.
Working in town provided the capital required to start my ranching career. Kat and I made a commitment to live on $2,000 a month and put the rest of our wages towards the ranch. If you don’t have a definitive plan on how to invest your wages, you run the risk of getting off track and spending money on shiny things you don’t really need.
My last year at the elevator, I made $70,000. I also received a $40,000 bonus. I had good insurance and a 401k. As you might expect, I had many sleepless and prayerful nights before finally making the decision to quit my town job. You must be very careful not to allow your town job to become a safety net you are unwilling to walk away from when the time comes.
The most important thing about having off-farm income is deciding what to do with it. Having a written plan and knowing what you want and where you want to be in five, ten and twenty years will help give you the discipline required to create a profitable ranch.
We used our off-farm income to purchase 320 acres and our homeplace. We also used this income to expand the cowherd. We were able to purchase a skid steer and a 20-year-old bale-bed pickup without incurring debt. Those two pieces of equipment allowed us to achieve some economy of scale.
Knowing how to be disciplined with our money took much of the stress off my shoulders when I was no longer receiving a monthly paycheck from my town job. We are now a family of six — and we still do our best to live on $2,000 a month. ( Kat thinks it is time to increase that figure.)
With a goal and some financial discipline, it is possible to build a profitable ranch business from scratch. It is okay to use income from a town job — as long as you are committed to making your town job temporary. Too many parttime ranchers are afraid to walk away from their off-farm income. Until they do, they will never be a fulltime rancher.