How This Member Set Herself Up for a Debt-Free Retirement Thanks to a Little-Known AFSCME Benefit

LaVerne Washington, an executive board member and steward of AFSCME Local 101, is on her way to retiring free of credit card debt. LaVerne has been an AFSCME member for over 18 years. As she started planning for retirement from her job as a paralegal, she researched ways to reduce her bills and high-interest credit card debt. She remembered that Union Plus Credit Counseling is one of the benefits available to her through AFSCME Advantage. We sat down and talked with LaVerne about how she did it.

AFSCME Council 57: When you first enrolled in the program, you were dealing with a lot of debt, right? How was that impacting your life at the time?

LaVerne Washington: I was dealing with a lot of debt…thousands of dollars. On top of that, I was just paying off my student loans and then I had to take out loans for my daughter, who was going to a very expensive private college.

Also, about that time, it really started to dawn on me that I was about to hit my 15-year mark of employment with the city (of San Jose) and I was getting close to retirement, which meant I should probably look at working a few more years so my pension would be half of my salary when I finally retire. So that told me in a few years, I better get myself together.

Council 57: As you started thinking about your retirement, what was the moment when you realized you needed to take a serious look at your financial future?

LaVerne: Well, let me take you back to 2009. It was the Great Recession, and the City of San Jose decided to balance the budget on the backs of its employees by taking 10% of our salaries, increasing our contributions to our benefits and laying off people.

Luckily, I wasn’t laid off. However, the 10% pay reduction really hit me hard. Because I was a single mother raising my daughter, I continued to spend normally instead of cutting back everything by 10%. You know, when you’ve got family—and lot of people found themselves in this situation—you just can’t do that.

About two years later, it really started hitting a lot of people. I happened to end up with a lot of credit card debt. Other people ending up losing their homes. There were a lot of bankruptcies. It’s just a hard situation when you’re dealing with a substantial cut to your income.

To me, bankruptcy was not an answer so I asked myself, “What can I do with this credit card debt?” I was struggling paying for my credit card debt. I was struggling paying for my daughter’s education and I thought, “I’ve gotta come up with something else.”

Council 57: So what did you do?

LaVerne: My first instinct was to see if maybe I could get a loan, and that’s when I came across the consolidated loan option that the credit union was offering. But one day, while I was organizing some AFSCME materials for one of our New Employee Orientations, I was looking in the packet and noticed the credit card debt management materials.

After doing my research, I found out that they not only offered lower interest rates but also offered a reimbursement of the first year’s fees if you pay on time. Plus, they could take it out of my bank account automatically. There were all these benefits that the debt management program offered through Union Plus.

I contacted them and let them know I was a union member. We got the process going and then went at it from there.

Council 57: You were able to take advantage of one of the many union benefits available to AFSCME members. What would you say to other folks who may not understand the true value of being in a union?

LaVerne: It’s interesting because, having been a union president, a leader and still a steward in my office, I have access to lot of union materials and know a lot about the benefits. I have to make sure my members have access to and know about those benefits. So just having that background and knowledge let me know that the credit counseling and debt relief was a valuable and useful benefit for me.

And I’m trying to get everyone else to become familiar with Union Plus because if there is a benefit available to you as a union member, you should be using it.

When City of San Jose and other workers ask me, “Why should I join the union?” I tell them that, as a government employee, you want to make sure you have a say in who’s going to be your boss. You also want to have a say in your working conditions and your wages and, in addition, as a union member you have access to valuable and useful benefits.