Although Indonesia has various policy initiatives designed to encourage smallholder forestry, it has not yet achieved its potential. Aggregated national-level data can often mask the variability in household income, making it difficult to tailor national policies to be effective for rural development. This article discusses results from a household survey, with data collected in 2013 and 2017 from a sample of 240 households in eight villages of three provinces in Indonesia: Central Java, South Sulawesi and Yogyakarta. The results indicate farmers across a wide wealth spectrum utilise forestry as an integral component of their farming systems, and that trees provide scope to offset declines in income from other sources. Local economies were found to be dynamic and volatile, with smallholders relying on planted forests to support their livelihoods. Survey results also revealed that most households derived the majority of income from non-farm sources, indicating a diverse rural economy operates across much of Indonesia.