One long-term investment we made and have enjoyed for the past twelve years is rural land in central Texas. Historically, land has increased in value over time, making it a viable long-term investment. To quote beloved humorist Will Rogers: “Buy land. They’re not taking it anymore.” Land, like any other investment, fluctuates in value, but has generally been a solid long-term investment. The growing population of the world continues to increase. It makes sense that more food will have to be produced to feed the growing population. Land prices should be on the rise again soon, and it seems like an opportune time to invest in rural acres before prices start to skyrocket here in Central Texas. Ultimately, as the world’s population increases, so will the demand for agricultural and ranching land. This was actually one of our deciding factors when we chose to invest in a ranch in Central Texas. According to an article in the September 2011 issue of RealtorĀ® Magazine, things are looking up regarding U.S. farmland and farmland values. The future is bright for those with acres to sell and for those who are ready to buy.

You don’t have to be a real farmer or rancher per se own and make good use of their cultivated area. If like us you are not, you can quickly learn enough to run your own cow/calf operation or you can always lease your property for grazing or growing cattle. You can immediately reap the benefits of an agricultural property tax exemption, better known as an “ag” exemption (which significantly reduces property taxes, provided the exemption is already in effect when you acquire the property) without having to be in the site continuously to run your cattle or livestock farm. If a property does not have an agricultural exemption, one can be applied for. The “ag” exemption along with the various income tax benefits of owning a ranch have provided us with substantial tax relief over the years. On the other hand, simply having a place in the country to escape to when city life drives you crazy is reason enough to invest in a Central Texas ranch or recreational acreage. When we first decided to purchase land in “Top of the Hill Country” in central Texas in Hamilton County as our getaway from the city (DFW), our primary plan was to find a recreational spot where we could hunt, fish, hike in 4×4. and search for Indian artifacts and fossils. We knew that in order to maintain our farm-exempt status, we would have to do more than play games. So we bought some cows to graze on the pastures and leased our farmland to a local farmer for grain production.

We have made a considerable effort to significantly diversify our investments. Like many of you, for most of our working lives, our investment portfolio has consisted primarily of 401Ks and taxable market securities. But, over the last 20 years, we have added to our portfolio: several rental properties, a combination cattle/recreational ranch in Central Texas (where we now live), a commercial construction company in Waco, TX, and finally, a farm and ranch real estate company located in Cranfills Gap, TX. As seasoned professionals, we understand the importance of financial diversification. In hindsight, though, our best investment overall has been the Central Texas ranch. Our initial decision to invest in rural property in Central Texas was made with the ultimate goal of “paying off” in the future, but enjoying it. now. We realized that life is too short and unpredictable and we made our decision. Of course, investments in the stock market are essential to ensure our future retirement, but they are long-term investments that cannot be enjoyed on a constant basis. There is no guarantee that we will still be around to see the end result of all our investments, but we are confident in our decisions; twelve years later, we have no regrets at all. Not only are we having a great time living in the country now, but we also have peace of mind knowing that we have secured our future with smart investments.

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