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As we approach the holiday months, also known as the “brrr” months, on the homestead, we finalize the Fall harvest, put up the last of the fall produce from the farm, and breathe a big sigh of relief; just before we jump right into our holiday plans and preparations. It’s that quiet time after the dust settles, and as the cold sets in, that we can take a look back and reflect on how the year has been and think about what we’d like to do next year.
One of the ways we can evaluate the success or failure of our homestead experience is by reviewing where we stand with finances, resources and assets at the end of the year. It’s not always a fun task, but it is important if you are going to try to monetize your homestead for financial gain, raise animals for food and sale, and /or grow and gather farm goods or farm by-products, to sell for profit. You need to keep track of the homestead/related items’ financials separate from your household expenses.
The importance of record keeping for farmers and ranchers can’t be underestimated. Those of us who were raised in the agribusiness world understand this very well. From the time I was a child and involved with 4H and FFA, I had to keep track of every feed bag and every bale of hay. A clean and well-kept record book was important to your overall success with your animal going to the fair. It was nearly as important as whether you would “make weight” so you could compete in showmanship and market animal classes at the fair.
Small homesteads or hobby farms may not be thinking in terms of agribusiness, therefore may not be paying attention to spending or keeping consistent records. If you don’t, you will never know where your money goes in what percentage to the running of the homestead, versus your own expenses for your home and family. Keeping good separate records for the homestead will also help you to sort out expenses and spending when tax season comes around.

Perhaps you’re new to farming, and are just starting to monetize your goods. Maybe you’re selling eggs or thinking of setting up a farmstand or a booth at the farmers market in the new year. Let’s look at an overview of how you might approach it.
Reflect and evaluate
Give a good, honest and unflinching review of the past year. Look back at what worked, what didn’t, and what you could have done differently and will need to do differently in the coming year. Sit down with your spouse/partner and talk about where things went wrong and where they went right. Don’t point fingers, or lay blame, no judgment; only honest evaluation of how you’re doing as homesteaders.
Look at those areas where you find yourselves lacking, and instead of beating yourselves up about it, think of it as an opportunity to learn a new skill and gain some knowledge that you can put to use in the future.
Homesteading is a huge learning curve for those who were not raised in farming or ranching families. It seems like a no-brainer, but in reality, a homesteader has to have a literal and figurative toolbox of skills at their command at any given time.
This capability and competence doesn’t happen by magic. It’s often hard fought and won. Be proud of your accomplishments and be humble about what you need to work on going forward. There is always so much more to learn. Keep notes as you discuss the year and give your experiences a good look back. Dissect and discuss it all. You may be surprised at what you’ve learned and what you’ve accomplished. Once you’ve done this, it’s time to brainstorm for the future!
Planning for the new year can be fun. You can think as big as you can dream. No idea is too extreme. This is the time to put all of your wants and desires out into the world. Share what you are dreaming of with your spouse/ partner, and allow yourselves to get excited about the future.
Write it all down. Discuss all the things that you’re both thinking and dreaming of, and flesh out the details. Do this for your home and for your homestead. After you’ve talked about your big dreams it’s time to look at the ways you can work towards making those dreams come true.
Start with practicalities. What are your immediate needs? What are the top 10 projects on the to- do list? Put them in order of priority. We like to break the new year down into quarters and plan those immediate needs in the first half of the year. Then we look at longer term goals, and begin to break them up into stages that we can accomplish over the course of the coming year.
All of this is subject to change, of course. You never know when an emergency vet bill, or home repair, is going to throw a monkey wrench into your plans. But do your best to plan everything in stages that should be doable in those time frames.
Long Term Plans
Look at those future dreams and plans, and go out 2 years and 5 years with what you hope to accomplish in that timeframe. Once you begin to break things down into stages, they become easier to visualize as reality, and you can clearly see that you are making concrete steps towards making things happen as you move through the year.

Now the fun part – Finances!
Two of the biggest problem subjects between couples are money and communication. Be forearmed with this knowledge before you sit down to discuss finances. Lay down some ground rules and make sure that each of you has an opportunity to voice their opinions and be heard without judgment.
For life partners to be successful in a home based business of any kind requires that you treat it like a business, and don’t let your personal issues become the focus. It helps if at least one of you is good with money. If not, I recommend you get a financial advisor to help you with budgets and planning.
Start by looking back at your budget from the past year. How well did you do? Did you come in over or under budget for your expenses on the homestead?
What were some of the unexpected expenses that came up during the year, and how did that set you back? Think about if you should be holding back an amount of money for the unexpected next year.
Take a look at your current financial status and make up the budget for next year. This should include things like:
- Expected expenses /repairs/ purchases
- Feed /seed – hay and grain for the livestock, and seed for your pastures and gardens
- Water – This needs to be broken down between water used to irrigate and water livestock vs. home use
- Fuel – Heat, vehicles and home vs. farm use
- Groceries – Home
- Utilities – Home vs. farm use
- Payments on loans – Also home or car loans vs. farm equipment or farm loans
- Vet – farm expenses for livestock
- Permits for farmer’s markets or farmstand sales –
- Vehicle maintenance – Personal use vs. Farm vehicles.
It’s important to separate your expenses between the household and the farm/ranch. This will give you the picture of what you can expect from the next year. Be sure to allow for price increases. Then budget in those projects that you discussed earlier.

Remember that this budget plan is a forecast, and is not written in stone, but try to break it down into a monthly amount that you will expend on these known quantities, and then forecast how much you expect to bring in from your farm enterprises. This will help you know where you can add income streams, to add profit. Maybe you plan to sell off some livestock this next year. What will you do with the profits from those sales? You may want to earmark them for something specific that you want to do, such as replace fencing or buy tires for your truck. Maybe you want to buy other kinds of animals or breed more of what you have. This should all be included.

You will want to do the same with your garden. Look back at the year’s harvest, both summer and fall. Look at what grew well, what didn’t, and use this information to decide what you want to grow next year. It will also help for you to decide on what kind of soil amendments you’ll need to make, and use this information to design your next year’s garden.
If you haven’t been monetizing your homestead, I hope this overview will help give you an idea of how to plan for doing so. Farming isn’t an exact science and everything you try isn’t going to be a success. Using a budget to separate your home and farm expenses is a smart way to handle your business.
It’s fun to plan for the future, and see how your homestead grows and to watch your dreams come true. Be sure to appreciate the process as it’s happening. One day you’ll be able to look back and see how far you’ve come. It all starts with the plans you make today.
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