Special Report July 22, 2009, 11:57AM EST

Weyerhaeuser's Financial Education

Promoting financial literacy among its employees pays off at the timber company in employee loyalty and productivity

More than a century ago, Weyerhaeuser (WY) began operations in America's Northwest as a logging company. Like many other frontier businesses, the job was hazardous. When a logger got hurt, the company took care of his family. (Most loggers were men.)

Flash forward to 2009. Cradle-to-grave benefits are no longer the norm in Corporate America. With the economy in tatters, workers these days feel lucky if they can get a free cup of coffee at the office. Company-sponsored health insurance and contribution-matching retirement plans are on the brink of extinction.

A Leader in Financial Literacy

And yet, despite the downturn, Weyerhaeuser is making sure that its workers maintain an educational safety net. It is recognized as one of America's leaders in providing financial education to nearly 14,000 employees.

Financial literacy is ingrained—pun intended—at the Federal Way (Wash.) timber company. "It's the best program I've seen that's sponsored by a company," says Steve Vernon, who is president of Rest-of-Life Communications, a retirement advisory firm and a former consultant at benefits giant Watson Wyatt (WW).

Weyerhaeuser's financial literacy efforts date back to the 1980s but took a leap forward when Sally Hass, a senior technology planning manager in the human resources department, noticed that corporate pension and 401(k) plan participants had poor savings habits in the 1990s. "When our stock price went up, they bought stock," Hass says. "They often would leave for other employers just prior to being eligible for a retirement benefit." Hass asked her manager if she could offer a retirement training program. Her planning seminars quickly caught on with employees, and soon the company established a benefits education department, led by Hass. This year, Weyerhaeuser will offer more than 40 retirement, benefits, and wellness programs to its workers.

Intensive Life-Planning Seminars

One-third of large American companies offer some kind of financial education to employees. Robert L. Clark, a professor of economics and management at North Carolina State University who studies corporate retirement and financial education programs, says Weyerhaeuser's employees rank at the top of major companies for their financial knowledge. He attributes much of the company's success to an extensive two-and-a-half-day life-planning seminar that's offered to all employees. Supplemental seminars are also offered throughout the year.

In 2008, Clark polled Weyerhaeuser employees who attended five seminars. His findings? All of the participants said that they were better informed about their retirement programs, 99% thought that they could now make better retirement choices, and 88% said they would change some of their retirement choices. "Participants thought the seminar was a valuable employee benefit, that it enhanced their positive feelings about Weyerhaeuser, and that it raised their awareness of the benefits that Weyerhaeuser provides," according to Clark's study.

Moreover, employees actually learned something. Survey responses show that many of them lacked basic knowledge about Social Security and Medicare prior to attending the retirement seminar. Clark's research shows they learned how these programs work as well the value of their own pension benefits. Seminar veterans also upped the age they planned to retire from 60 to 62.

The end result of all this planning is that "folks feel a lot better about Weyerhaeuser," Vernon says. "It helps Weyerhaeuser retain them and keep them productive."