How to Create a Financial Emergency Plan

You may have an emergency fund, but you probably don’t have an emergency plan. And it’s time you created one.

My son recently brought home a homework assignment. He was supposed to write down a plan for what to do if there was a fire in our house. He’s not even 6.

That same week, our daughter told us about a fire drill in her daycare. She’s only 3.

Even at that age, it’s important to have a plan for the direst of circumstances. Fires are chaotic. To help cut through the confusion and the stress, we come up with plans and practice them. Without confusion, there will be less chaos and fear.

If we plan and practice a response to a fire emergency, why don’t we do the same for other emergencies?

Do you have plans for a car accident or a medical emergency that could leave you with four- or five-figure debt? You may have an emergency fund, but you probably don’t have an emergency plan. And it’s time you created one.

The key to a successful financial emergency plan is that it outlines the steps you would take if you ever had to face that emergency. It means you’ll walk through what you would do if the emergency were actually happening.

For example, the biggest financial emergency I can think of is losing my job.

In my emergency plan, here’s what I would do:

• Lower (or cancel) all nonessential expenses. I would immediately cancel Amazon Prime, my Netflix account and all the recurring costs that are completely discretionary. For services I couldn’t cut immediately, such as my two-year cable internet subscription, I’d downgrade the service to the lowest possible tier.

• Adjust my budget. Since I’d need to live off my emergency fund, I’d need to adjust my budget to be deliberate in my spending.

• Learn how to apply for unemployment benefits. I’d need to know the process for getting unemployment from my local state unemployment office. Learning it now would be easier than under duress.

• Decide how to tell my family. This can be one of the hardest things to do, but preparing for it in advance could make it far less painful.

• Establish a plan for finding a new job. Whether it’s setting up profiles on relevant job search sites or reaching out to my network, I’d establish that plan now so I could execute it later.

• Consider how to spend my downtime. Maintaining a positive attitude during a negative experience — one that could persist for many weeks — is crucial. So is planning for the greater abundance of downtime during the week. I’d need to find projects that would give me a sense of purpose to combat the frustrations I’d experience during a job search.

This is just a subset of the things I’d do if I was laid off. As you build your plan, you’ll want to expand on this list, but I wanted to provide a starting point. (Another good starting point: Checking your credit scores, which can impact your finances. You can view two of them for free, with updates every two weeks, on Credit.com.)

What Events Should You Plan For?

The big ones are a death in the family (including yourself), loss of your job or ability to do your job and catastrophic loss of a major asset like your home or vehicle.

Once those major emergencies are covered, you can expand to less-significant but important emergencies. What if your furnace or HVAC system fails? What if your oven, washer, dryer or other major appliance stops working? These are not as financially painful as losing a job or your car, but they’re still inconvenient and require research.

As you build out your plan, don’t be afraid to add to it. No emergency is too small, and taking the time now will pay off in the long run.

Hopefully you’ll get lucky and never need your plan at all.

Image: sturti

The post How to Create a Financial Emergency Plan appeared first on Credit.com.

Didn’t Get the Job? 3 Things You Can Do to Change the Interviewer’s Mind

There are some steps you can take that could either change the interviewer’s mind or lead to another opportunity. Here are three things you can do.

After months of searching for jobs, your dream company called you in for an interview. Your resume was flawless, you wore your best interview attire, and you confidently headed to Dreamy Company to meet the hiring team. Things went well. The interviewers laughed. You successfully answered every tough question, and you even got to meet your future co-workers. Things couldn’t have gone better.

After one week, you finally hear back from the hiring manager. This is it; it’s the email you’ve been waiting for. As you click open the message, your heart sinks. Much to your dismay, the first sentence starts with, “We regret to inform you …” and that’s when you know you didn’t get the job.

But all is not lost. There are some steps you can take that could either change the interviewer’s mind or lead to another opportunity. Here are three things you can do.

1. Ask for Feedback

How you respond to rejection is everything. You may be tempted to ignore the rejection email and move on with your job search. Or you may surrender to the temptation to give the hiring manager a piece of your mind. However, if you still want to work for the employer, respond kindly with a request for feedback. Rather than expressing your disappointment or getting angry, put your pride aside, try to sincerely gain an understanding of what went wrong and learn how you may be able to improve. Start by thanking the interviewer for their time and reaffirming your desire to work for the company. Then ask if there is any way you can improve your candidacy for similar positions in the future.

Career expert and former recruiter Jaime Petkanics said responding to a rejection email and asking for feedback can be a smart way to leave the door open. You never know when a position you’d be a great fit for will become available. Your positive attitude will leave a good impression and keep you top of mind.

“I’ve turned down plenty of people in my career as a recruiter because the job fit wasn’t quite right – even when the company fit is very much there,” according to Petkanics. “I have gone back to many of them at future dates to talk about new roles that were a better fit and in lots of cases have hired them. In case that is an option, you want to keep that relationship intact. It’s also a great idea to express that you’d still like to be considered for future roles if something comes up.”

2. Ask for a Chance to Join a Training Program or Apply for an Internship

Another way you can get your foot in the door at your dream company is to show that you’re willing to learn. A positive attitude is another trait hiring managers seek. A whopping 73% of managers in a CareerBuilder survey said this soft skill was also very important when it came to identifying a good company match. Some companies host training programs for entry-level employees and career changers looking to break into a particular field. Show how positive and motivated you are by asking if the company has a training program. If they do, ask how you can be part of it. If a training program does not exist at the company, inquire about an internship (if you can afford to take a pay cut). If you’re determined to become their employee, now is the time to be flexible and a little creative. You never know, your determination may just change the hiring manager’s mind.

3. Follow Up on a Question You Didn’t Answer Well

If you haven’t heard back from that dream company yet, you want to prepare for future options, or you know they haven’t filled the position yet (despite sending a rejection letter your way), there’s something else you can try. If you know you completely flubbed an answer to an important interview question, there are no rules against sending a follow-up email with a better answer. This is your chance to give yourself a do-over before the hiring manager makes a decision.

Following up and taking another stab at the question shows not only that you are serious about the job but also that you are the type of person who doesn’t give up easily. Motivation is a personality trait many employers are looking for when it comes time to hire new employees. Roughly 66% of employers in the CareerBuilder survey said motivation is an essential soft skill. So just by following up to revise your question, you’ve shown a positive trait that might turn things around in your favor.

[Editor’s Note: It’s important to remember that many organizations review a version of your credit report as part of the application process. To help you be informed of where your credit currently stands, you can take a look at a snapshot of your credit report for free, updated every 14 days, on Credit.com.]

This article originally appeared on The Cheat Sheet.

Image: SIphotography

The post Didn’t Get the Job? 3 Things You Can Do to Change the Interviewer’s Mind appeared first on Credit.com.

Massachusetts Just Banned This Question From Job Interviews

When applying for a job, most applicants expect to answer a few questions about their past salaries. But that will no longer be the case in Massachusetts.

In what the New York Times described as “a groundbreaking effort to close the wage gap between men and women,” Massachusetts became the first state to bar employers from asking about applicants’ salaries. The bipartisan legislation was signed into law on Monday by Gov. Charlie Baker, a Republican, and will go into effect in July 2018. It requires employers to disclose compensation upfront — and that figure be based on an applicant’s worth to the company as opposed to what they made at another job.

The idea behind the law is that preventing companies from asking prospective employees what they earned at previous jobs will ensure women and minorities have a fair shot at competing with men, who tend to earn more, the Times reports. The law also bars employers from prohibiting workers from sharing salary info, which advocates hope will boost salary transparency.

As it stands, women are paid 79 cents for every dollar men earn, according to the U.S. Census Bureau, and gender pay disparities persist in nearly every occupation from construction to information technology. A number of factors play into this, of course, but in general, the gender pay gap tends to vary by which state a woman calls home, along with her age and race. According to a 2016 report from the American Association of University Women, Asian-American women earn 90% of white men’s incomes, while African-American women are only paid 63% of their salaries. Worse still, Hispanic or Latina women earn nearly half (54%) of what white men do.

To further level the playing field, the Massachusetts law will also require equal pay for work of “comparable character,” the Times reports.

“This is a sea change, and we hope it will be used as a model in other states,” Victoria A. Budson, executive director of the Women and Public Policy Program at Harvard’s Kennedy School of Government and chairwoman of the Massachusetts Commission on the Status of Women, told the Times.

Getting Better Pay

Whether more states follow Massachusetts’ lead remains to be seen. In the meantime, you may be able to increase your paycheck by negotiating a raise with your employer or researching and applying to companies that are known to offer better compensation packages to qualified employees.

And, if you’re applying for a job, it’s a good idea to know where your credit stands, as some employers review a version of your credit report during their application process. You can check your credit by pulling your credit reports for free each year at AnnualCreditReport.com and by viewing a free credit report summary, updated each month, on Credit.com.

Image: PeopleImages

The post Massachusetts Just Banned This Question From Job Interviews appeared first on Credit.com.

Massachusetts Just Banned This Question From Job Interviews

When applying for a job, most applicants expect to answer a few questions about their past salaries. But that will no longer be the case in Massachusetts.

In what the New York Times described as “a groundbreaking effort to close the wage gap between men and women,” Massachusetts became the first state to bar employers from asking about applicants’ salaries. The bipartisan legislation was signed into law on Monday by Gov. Charlie Baker, a Republican, and will go into effect in July 2018. It requires employers to disclose compensation upfront — and that figure be based on an applicant’s worth to the company as opposed to what they made at another job.

The idea behind the law is that preventing companies from asking prospective employees what they earned at previous jobs will ensure women and minorities have a fair shot at competing with men, who tend to earn more, the Times reports. The law also bars employers from prohibiting workers from sharing salary info, which advocates hope will boost salary transparency.

As it stands, women are paid 79 cents for every dollar men earn, according to the U.S. Census Bureau, and gender pay disparities persist in nearly every occupation from construction to information technology. A number of factors play into this, of course, but in general, the gender pay gap tends to vary by which state a woman calls home, along with her age and race. According to a 2016 report from the American Association of University Women, Asian-American women earn 90% of white men’s incomes, while African-American women are only paid 63% of their salaries. Worse still, Hispanic or Latina women earn nearly half (54%) of what white men do.

To further level the playing field, the Massachusetts law will also require equal pay for work of “comparable character,” the Times reports.

“This is a sea change, and we hope it will be used as a model in other states,” Victoria A. Budson, executive director of the Women and Public Policy Program at Harvard’s Kennedy School of Government and chairwoman of the Massachusetts Commission on the Status of Women, told the Times.

Getting Better Pay

Whether more states follow Massachusetts’ lead remains to be seen. In the meantime, you may be able to increase your paycheck by negotiating a raise with your employer or researching and applying to companies that are known to offer better compensation packages to qualified employees.

And, if you’re applying for a job, it’s a good idea to know where your credit stands, as some employers review a version of your credit report during their application process. You can check your credit by pulling your credit reports for free each year at AnnualCreditReport.com and by viewing a free credit report summary, updated each month, on Credit.com.

Image: PeopleImages

The post Massachusetts Just Banned This Question From Job Interviews appeared first on Credit.com.