Money on the mind

Carri and Mark Berglund recently overhauled their finances, paying off about $10,000 in loans, cutting up credit cards and starting a disciplined savings plan.

The North Idaho couple, both in their mid-40s, knew what they should be doing. But it took a series of personal finance sessions paid for by Carri Berglund’s employer to move them from intent to action.

They met with 10 other couples from Victory Homes in the company’s conference room after work. Financial planners from D.A. Davidson took them through the basics of budgeting, saving, and investing, while the couples confessed their financial screw-ups with the ruthless honesty normally reserved for AA meetings.

“It was encouraging to look across the table at people you thought really had it together, and hear them say things like, ‘I knew I shouldn’t have charged it, but I did anyway,’ ” said Carri Berglund, sales and marketing director at Garage Town, an affiliate of Victory Homes.

Victory Homes paid about $200 per couple for its employees to participate in the three 1-hour sessions.

It’s a trend that’s becoming more common in the workplace.

Earlier this year, IBM announced that it would spend $50 million on a personal finance program for its 127,000 U.S. workers, primarily to help them transition from a traditional retirement benefit plan to an enhanced 401(k).

Though most employer-supported programs aren’t that lavish, about one-third of workers receive some type of financial education at work, according to national studies. Most of it revolves around retirement planning. But some employers are beginning to provide broader money skills training, recognizing the stress created by poor financial habits.

Last week, D.A. Davidson took its financial planning classes to Centennial Distributing in Hayden, attended by 25 workers and their spouses. Company owner Mark Duvall, who paid more than $5,000 for the training effort, considered it money well spent.

In 17 years as a small business owner, he’s seen worker productivity slip when employees are struggling with credit card debt or facing the financial fall-out from a major life change, such as divorce. By helping his workers increase their financial savvy, Duvall figures he’s making a long-term investment in his beer and wine distributorship.

“Your No. 1 asset is your employees,” he said. “We want to get out ahead of the game and be pro-active.”

Knudtsen Chevrolet in Post Falls also offered the training. President Eve Knudtsen started saving in her 20s, putting aside $200 from each monthly paycheck. Disciplined saving has brought her the peace of mind that comes with financial security, she said.

“I want the same thing for my employees,” Knudtsen said.

D.A. Davidson’s particular program emphasizes spending less than you earn and building wealth over time through regular investing. The three presenters start with basic concepts like household budgeting and compound interest. They move onto the stock market and other types of investments, purchasing insurance, and the effect of inflation on retirement income.

Spouses and partners are strongly encouraged to attend. For some couples, it’s the first time that they’ve engaged in frank discussions about different spending styles, said Brad Dugdale, senior vice president at D.A. Davidson.

“In most families, we find that spenders attract savers,” Dugdale said. “Very rarely do we see two savers together.”

Gayle Baxley jotted notes last week while attending a session with her husband, Lenny, a driver and salesman for Centennial Distributing.

The couple, empty nesters ages 59 and 56, describe themselves as both combination spender/savers.

“Neither of us has a lot of debt. We pay off our credit cards every month,” Gayle Baxley said. “But we should be more disciplined about saving. It’s amazing how the little bits here and there add up.”

Fly-fishing equipment is one of the couple’s weaknesses. They’re both avid anglers.

On the plus side, they both contribute to retirement accounts – Lenny has been with Centennial Distributing for 25 years, and Gayle works for the Hagadone Corp. as a bookkeeper at the Coeur d’Alene Inn. The couple also individually tracks their expenses on ledger sheets.

By the time the class finished at 7:30 p.m., Lenny Baxley was yawning. He works an early shift, rising at 4 a.m. to get to work before sunrise.

“We’re normally in our sweats by this time of night,” Gayle Baxley.

Jon and Brenda Schnider of Hayden took their 19-year-old son, Travis, along when they attended the financial planning sessions at Victory Homes.

Travis received a good grounding in personal finance at Coeur d’Alene’s Charter Academy, his dad said. But the reinforcement was important; Travis is working now, earning good money on a crew installing power lines.

The importance of investing early so that the money can grow over several decades caught his attention.

“He took that advice and started his retirement account,” Jon Schnider said.

Schnider and his wife also found the sessions helpful. The couple, ages 49 and 47, exhausted their savings during an 18-month period when they worked as missionaries.

Since 2000, they’ve bought a house and investment property, and started saving for retirement.

However, “it’s rapidly approaching and we realized that we weren’t ready,” Schnider said.

The couple stepped up contributions to their 401(k) account and began tucking money into an individual retirement account. They’re making sacrifices from each paycheck to make up for lost time, Schnider said.

The Berglunds – the couple who paid off their debt – took stock of what they owned and decided to sell a vintage Land Cruiser that Carri Berglund described as a “project vehicle.”

The sale of the vehicle and other miscellaneous items generated the cash to pay off loans. “It got rid of some of the clutter, too,” she said.

They’ve also set aside money for a trip to Mexico next year. In addition to being frugal, the classes discuss the importance of setting aside money for rewards. The Berglunds followed the advice, pre-paying nearly all of the vacation expenses.

“We just need to bring some fun money,” Carri Berglund said.