How to Make Money With Your Small Farm or Homestead

Get Started Actually Making Money With Your Homestead or Small Farm

When my small farm business didn't quite work out the way I wanted it to, I didn't keep it secret. No, I wrote a whole article about it and talked about it on social media, too! I'm not ashamed that, in many ways, I had to start over; I learned more about myself, what I'm capable of, and how to make a living off my own land by the time I was 30 than some people might ever learn. I walked the walk. I still walk it—because I'm a doer, not a talker.

Now that I've had time to reflect on my experiences, pick myself up out of the disappointment, search my soul for my purpose, and begin anew on a more intentional course, I'm ready to share what I've learned about how to actually make money with a small farm—based on what I did wrong, and what I did right.

This article is for the beginning farmer. It won't be much use to established homesteads that earn income or multi-generational farmers that already have everything set up and running.

1. Have Capital (That's Cash, Friends)

I am so sorry that this has to be my first piece of advice, but before you click away from this article, give me a chance to explain.

You need cash to survive the first year or two when your farm business won't make any real income. Even if you own the property outright and literally produce all your own food (not as easy as Pinterest makes it look), it's just not possible to completely eliminate the need for money.

You Need Cash for Two Main Reasons:

1. Money to live on while you create a farm business that turns a profit
2. Money to invest in making your farm business actually succeed. In my experience, absolutely everything costs more than you expect it to, and it's harder to find those essential items for a good deal on Craigslist than you thought it would be.

If you don't have this money in a savings account (who has two years' expenses in a savings account?!), then you'll have to earn income some way. This brings us to the next unfun, really tough bit.

2. Earn Income Somewhere Other Than the Farm, at First

You, or your partner, if you're lucky enough to have one (or both of you if you live in the U.S. where one income isn't generally livable anymore), are going to have to work a job that pays the bills. I know, I'm sorry—it's not exactly the fantasy. But you've just got to hold fast until your farm business picks up.

If you don't start off running the farm and working another job simultaneously, you're likely to end up unable to continue with all your farm commitments when you (almost certainly inevitably) have to get a job doing something else just to make ends meet.

I would recommend getting a job that's related to gardening, livestock-tending, or agriculture in general if you can. Or at least try to get a job that helps you stay physically active but not physically exhausted—I've done both of those types of jobs, and it can be hard to do farm work after your other job if you're just beat.

One positive to having to work off-homestead is that if you can land a job at a successful, established farm, then you could learn a ton of invaluable information about the business and your particular farming community.

If you're independently wealthy or have financial benefactors to support you through this transition, then I suppose you can ignore all the financial advice I just gave and also never speak to me again.

3. You Can't Do It All, So Don't Try

So there you are with your new land, all your hopes and dreams, some amount of money, and a job that pays the bills but pulls you away from your farm. You're probably bursting at the seams with ideas and aspirations for your new space—which is great, as long as you rein it in.

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If you try to do all ten (twenty, thirty) of your ideas for income streams for your farm, you'll just burn through your cash trying to start them up and then not be able to focus on any of them to the necessary extent.

Think of Each Income Stream as a Separate Business

If you want to grow berries for a you-pick, have a market garden, process and sell pastured meat chickens, and raise hogs to sell feeder pigs, these are all great ideas and also separate things.

Your berry farm and hog operation require different and competing attentions. They'll be especially hard to manage during the growing season when you're gardening and going to market to sell your produce. And don't forget you're also working an unrelated, non-farm job so that you can pay the bills while you hold fast, waiting for your investment in the farm to return a profit.

So, it's best to choose just one or two things to focus on—at least at first. Once you've established one income stream, you can start to build the next. Once you have a successful market garden business, you can start a meat chicken business, and then a berry farm business, and then a feeder pig business, etc.

If you think about it this way, you probably wouldn't start more than one new business in any other field at once, right?

This is a hard lesson, I'll admit, and definitely one I learned at great expense, both financial and emotional. It requires a shift from thinking of "the farm" as one thing and instead really thinking critically about each individual way you plan to use the farm/land/homestead to earn money.

Each project, type of garden, crop, or animal product is a separate micro business that needs individual management. This brings us to the next lesson.

4. Choose Farm Income Streams That Suit Your Land and Property

This was perhaps the hardest lesson I learned, and it cost me a lot to come by it: You can't do all the farming and homesteading things that you want, that are your favorites, just because you love them and expect to turn a profit.

Now, this isn't to say don't do what you love. If your heart is set on raising beef, then buy your cattle—just know that if you can't also produce your own hay or other feed, then you're not likely to have a profitable beef operation.

If your land has no pastures (or spaces that can be readily converted), then buying a flock of 50 sheep is probably not the best idea. If your land is swampy, a fruit orchard probably won't succeed. Your shady market garden in the woods probably won't produce enough hot peppers to pay for itself—you feel me?

So take careful stock of your land. Really think about what its best use might be. Personally, I had to accept that trying to turn a profit with sheep wouldn't be possible as long as I was buying hay for the long, cold Minnesota winters. I had enough pasture for the sheep to intensively graze in a rotational system during the growing season but no land for hayfields or even an area I could have planted in winter forage and overwintered the flock on.

Looking at my land with a more critical eye, I see that it's much more suited to a small market garden, a berry field, a small orchard, and perhaps hogs-in-the-woods. But I'll be taking my own advice and tackling each of these enterprises separately—as the separate micro-businesses that they are!

This article is accurate and true to the best of the author’s knowledge. Content is for informational or entertainment purposes only and does not substitute for personal counsel or professional advice in business, financial, legal, or technical matters.

© 2022 Rachel Koski Nielsen