The best way for Farmers to clear debt is by sinking money away somewhere in good years or if they can, even every year.
All debt has to be repaid. The worst thing a farmer can do to their children is hand on a debt. That is because farming with the bank on your back, taking more of the profit than the farmer who does the work, is very depressing. Children who have inherited or purchased a farm weighed down with debt find they cannot farm profitably and yet if they sell the farm in part or in whole, they often feel guilty that they have let the family down. It is not a reasonable view but it can have serious impact on their mental outlook. The way that I looked at the farm that I had purchased, originally started by my great-grandfather, was that it was mine and I could decide when to hold or sell the farm or particular blocks. No guilty feelings at all. We must all do what is needed at the time. Sometimes a farmer can clear a debt by selling a block. Other times the farmer can add a new block when there are surplus funds and no debt.
Squirrel away funds
The key is to put money away when it is earned. I prefer to see people store money away from the bank where they have their loan and then pay their debt out in full one day, or pay off a substantial amount of debt and fix the debt so that it cannot increase again. Moneylenders, banks, prefer to keep a farm in permanent debt because then it is like them having a
money-producing mouse on a treadmill. Clearing debt has a lot going for it. Farming with constant debt makes somebody else rich from the interest payments.
