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Dairy Business Farm Planning

Stage 4: Developing a financial plan

After completing your farm plan, the next step is the financial plan. This is where all your financial data is used to calculate cash flow for six years based on your farm plan. It takes into account variable and fixed costs, inventory changes, total repayments, family living expenses and taxation. If your proposed plan cannot meet all the cash outflows then you must go back to re-think your farm plan to see where it can be changed and improved.

Your financial plan will help you to:

  • Assess the overall financial viability of your proposals;
  • Examine the impact of changes in key variables e.g. milk price, fertiliser price, interest rate;
  • Negotiate with and secure finance from your bank/ lending institution; and
  • Understand where you cash is coming from and going to each year during the critical transition phase of your plan.

Completion of this workbook is an important, and necessary, first stage in the planning process. You now are in a better position to seek assistance in the preparation of a financial plan for your farm. . If you require assistance in completing a financial plan then you should contact your local Teagasc office.

You now have completed the ‘thinking process’ and have a farm plan for your idea. It is up to you now to take the next steps towards making your plan a reality.

Good luck!


The following is an example of the annual financial plan for a seven year period from the Teagasc Farm Business Planner. You will have a full understanding of the financial data in this financial plan by having completed this workbook in advance

Financial Plan – annual financial plan based on your farm plan