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Browsing by Author "White, Alexander B."

Now showing 1 - 9 of 9
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    Building Your Financial Team: Financial Planners
    White, Alexander B. (Virginia Cooperative Extension, 2009-05-01)
    How financial planners can help you and how to choose one.
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    Credit risk-rating system for agricultural leases
    Jarvis, Marilyn Adams (Virginia Tech, 1992-12-05)
    Agricultural leases issued to forestry, dairy and cash crops operators from 1980-1992 are reviewed to determine factors statistically significant in predicting risk level (probability of default and/or probability of late payment) of the lessee for each industry. From a previous study of Telmark, 1990, literature review and the Recommendations of the Farm Financial Standards Task Force financial, operator/lessee and farmer/operator variables are selected for analysis. Data obtained from Telmark,Inc. are used to develop a model to explain lease risk level of the forestry, dairy, and crops industries. Results show that for forestry the following financial, lessee/operator, and farmer/operator variables are useful in determining riskiness: operating expense to revenue, cash flow coverage, capital turnover, years in business, gross revenue, and owner's equity. The dairy results indicate that the following variables are important: current ratio, cash flow coverage, return on assets, capital turnover, operating expense to revenue, FHA loan secured, owner's equity, and gross revenue. The crop results indicate percent equity, current ratio, cash flow coverage ratio, return on assets, capital turnover, operating expense to revenue, interest to income, real estate owned, years in business, FHA loan-secured, and owner's equity are significant variables for determining lease risk. Using the results from these models, a weighted average cost of misclassifying a lease is calculated. This is used to develop a profit maximizing criterion for determining whether a lease is high or low risk. The need for future work is discussed. In the area of weighted average cost of misclassifying a lease, additional information on the costs of leasing and riskiness of the population would aid in reducing the misclassified leases in the portfolio. Further study exploring some of the unexpected results in this study would be beneficial to both the lessee and the lessor.
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    Dairy Pipeline November/December 2019
    Ferreira, Gonzalo; White, Alexander B. (Virginia Cooperative Extension, 2019)
    Information about alfalfa for feed and business practices.
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    Dairy Pipeline, June 2018
    White, Alexander B.; Ferreira, Gonzalo (Virginia Cooperative Extension, 2018-05-30)
    This issue has two articles. The first one focuses on financial planning, while the second one discusses the Margin Protection Program for dairy farms.
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    Dairy Pipeline. April 2019
    White, Alexander B.; Winston, David R. (Virginia Cooperative Extension, 2019-03-25)
    This issue has two articles. The first focuses on taxes, and financial planning. The second article discusses the Collegiate Dairy Challenge.
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    Dairy Pipeline. November/December 2020
    White, Alexander B.; Winston, David R. (Virginia Cooperative Extension, 2020-11-09)
    In this issue: Financial Lessons from a Pandemic; Evaluating Transition Cow Management; Upcoming Events
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    Database Marketing Management Strategies for Agricultural Lenders
    Wilson, Amanda Janice (Virginia Tech, 1998-04-10)
    This study examines the use of databases to improve marketing techniques and customer segmentation in lending institutions. Specifically, this study examines the use of products and services by agricultural customers, and then determines the relationship between the use of those products and services with farm business characteristics. Information is also obtained on the interest rate sensitivity of the producers and correlated with farm business characteristics. The importance of technology and strategic alliances and other influences in the decision making process are determined after survey analysis. The survey was sent to producers who had some type of loan. Respondents from this study used an average of 3.2 loan products and 7.6 services for a total of 10.8 loans and services. Only 1 percent of the respondents indicated that they did not have a personal checking account. Twelve percent of the respondents indicated that they did not use a credit card. Only 16 percent of the respondents indicated that they used leasing services. Investment products did not have a high percentage of use. Thirty-three percent indicated they were using certificates of deposit, while only 21 percent indicated the use of money market funds, and 30 percent indicated the use of mutual funds. Thirty-seven percent indicated they were using IRAs. However, most of the respondents were using some form of insurance. Three-fourths of the respondents were using life insurance, while only 21 percent indicated that they did not possess disability insurance. Other services were also analyzed in this study. Only 15 percent of the respondents indicated that they were utilizing estate planning services, despite the 67 percent of respondents who were greater than age 41 and the 58 percent of respondents with greater than $500,000 in assets. Seventeen percent of the respondents were using an appraisal service. Due to the lower levels of usage for the investment products, this study focused on the relationship between farm characteristics and the investment products. This study showed that a relationship existed between farm and non-farm income with IRA usage. iii Only farm income had a relationship with money market fund usage and mutual fund usage. While, the use of estate plans was related to asset level. The analysis on interest rate sensitivity was determined by the amount an interest rate would have to decrease for a producer to switch lending institutions. The producers who were found to be less interest rate sensitive were those who had lower farm and non-farm incomes, lower asset levels, lower education levels, higher debt-to-asset ratio, and those who owned a computer. This implies that these are the more loyal customers to an institution or perhaps these producers have fewer opportunities to switch institutions. Producers in this study indicated that when selecting a lender/service provider, a competitive interest rate (76 percent of respondents) and the institution being a dependable source of credit (75 percent) was important. Knowledge of agriculture was also very important (69 percent of respondents). Internet banking and educational seminars rated as the characteristics that were least important, 3 percent and 9 percent, respectively. However, in the decision making process, lenders (69 percent of respondents), accountants (53 percent), and veterinarians (38 percent) were shown to be very important. The spouse/partner has considerable influence also on decision making. Sixty-seven percent of the respondents indicated that the spouse/partner had a considerable influence on investment decision, while sixty-one percent of the respondents indicated that the spouse/partner had a considerable influence on credit decisions. Five specific recommendations were made to the institutions following this study. These recommendations include: use of technology, institutional use of databases, use of influencers, and targeting and segmenting the marketplace.
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    Managing Prosperity: Estate and Retirement Planning for All Ages. Building Your Financial Team: Financial Planners
    White, Alexander B. (Virginia Cooperative Extension, 2009-05-01)
    Financial matters are becoming increasingly complex - tax regulations are always changing, new investment vehicles are constantly being developed, and estate planning laws are constantly being revised. It's easy to get confused and fall into the "One Step Forward, Two Steps Back Syndrome." This syndrome occurs when you make a financial move that is intended to provide certain benefits, but it ends up hurting you without your knowing it. An example is trying to save money by minimizing your annual income taxes ­ while this may lower your income tax bill, it also drastically reduces your future Social Security benefits and the amount you are eligible to invest in a qualified retirement plan. It's hard for one person to keep up with all these changes and manage a business (or family) at the same time. That is why you should consider forming a financial advisory team. Let the experts keep you informed about current financial issues so you can make informed decisions that will help achieve your financial goals.
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    Pre- and post-retirement asset allocation: a simulation of retirement investment strategies for agricultural producers
    White, Alexander B. (Virginia Tech, 1995)
    This research simulates pre-retirement investment scenarios for agricultural producers. Thirty-two investment scenarios are examined, with each scenario differing with respect to retirement vehicle, investment strategy of the producer, and the use of a cash margin for reinvestment in the operation versus prepaying term debt (cash preference). The retirement vehicles included in this study are Individual Retirement Accounts (IRAs), Simplified Employee Pension Plans (SEPs), and 401(k) plans. Investment strategies reflect the producer's preference for investing in conservative, balanced, or aggressive assets, or a combination of these assets. Further, these scenarios are examined for three methods of capitalization: Case I- an operation with a 50 percent debt/asset ratio; Case II - an operation with a 65 percent debt/asset ratio; Case III - an operation with a 65 percent debt/asset ratio with a majority of the farm land being leased. The analytical model simulates the annual cash flows of a commercial agricultural operation for each investment scenario over a 30-year period. Stochastic rates of return, generated using a vector-autoregressive (VAR) model, are incorporated into the simulation model. Each scenario is replicated 100 times using different vectors of stochastic rates of return. Results show investment in retirement vehicles does not significant reduce ending farm assets, regardless of investment strategy or cash preference of the producer. Use of retirement vehicles does have a significant positive impact on ending net worth for the producer. IRAs are not significant investment tools for producers (or spouses) who are participants in another qualified retirement plan. Investment strategy has a major impact on ending net worth. Aggressive and dynamic (aggressive to conservative as retirement approaches) investment strategies dominate conservative and balanced strategies. Use of cash margin to prepay debt has no advantage over reinvesting in the farm. Retirement vehicles greatly improve the probability of meeting estimated family living needs during retirement, and generate greater diversity and liquidity of the retirement portfolio. Further, retirement vehicles are more important for producer with highly-leveraged operations and for producers who lease a majority of their assets.