What to do?

Larry Caldwell larryc at teleport.com
Sun Aug 23 17:22:29 EST 1998


[This followup was posted to bionet.agroforestry and a copy was sent to 
the cited author.]

In article <35dd0186.2076337 at nntp.a001.sprintmail.com>, ddd at hi.there.com 
says...

> Which brings me to my question.  My wife and I are tossing
> around the idea of buying some land (in southern Missouri)
> and planting some trees for our retirement.  We're in our
> mid 30's now and hoping to retire around 60.  Our questions
> are:
 
> 1. Is this approach (buy land, manage it loosely for ~20
> years, then harvest) financially sound?  Would we do better
> by sticking our retirement $ in CDs or would the potential
> future timber sales offer a greater return?

Planting trees?  No.  Forget it.  You would be buying a lifestyle without 
much return.

However, there is a big advantage to buying land with established small 
trees.  The current forestry establishment won't appraise a young 
plantation as worth much more than the equivalent number of seedlings, 
but trees take 5 to 10 years just to get taller than the competing grass.  
You can get a 10 to 15 year jump on your management plans just by buying 
somebody else's undervalued assets.

Look for land with lots of 2 to 4 inch stems of commercial species in 
your area.  Any professional forester will come in and tell the current 
owner that the trees have no cash value, even though they are 15 years 
old.  20 years later they will be 35 year old trees, several inches 
larger and many feet taller.

With a little shopping, you should be able to take advantage of someone 
who is either too ignorant or too impatient to realize the value of his 
holdings.

For financial advice, find an accountant who handles timber accounts.

-- Larry



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