If there’s even a hint of impending layoffs at your workplace, get a copy of your credit report. That’s the advice of Gail Cunningham, a spokeswoman for the nonprofit National Foundation for Credit Counseling.
Why? Because potential employers may want a look at it. If there are any errors or delinquencies on your report, the time to deal with them is before you need to make a good impression.
You’re permitted one free report every 12 months from each of the three major bureaus. Get them through www.annualcreditreport.com. (Questions? Read “Your Credit Score, Your Money & What’s at Stake: How to Improve the 3-Digit Number that Shapes Your Financial Future” by Liz Pulliam Weston.)
Nobody wants to think about layoffs. But it’s a good idea to be ready for them. Here are a few more NFCC suggestions:
Be indispensable. Don’t sail in late and sneak out early. Make your work outstanding. It’s no guarantee – heaven knows that hard workers are let go every day – but if layoffs do come you may stand out as one of the keepers.
Update your resume. Cunningham says resumes are often scanned for key words, so you’ll want to phrase your skills correctly. For tips, see “How to write a resume (that gets job interviews)” on the Squawkfox PF blog.
Got insurance? Get a check-up. If you’ve been putting off that tooth-cleaning or annual physical, stop dilly-dallying and take advantage of medical coverage while you have it. If you have a spouse or partner with insurance, learn how to get added to that program should it become necessary.
Know your bennies. Your employer may provide placement assistance, retraining and severance. Or it may offer nothing except an escort to the front door. Find out what benefits are offered, so you’ll be ready to roll.
What’s Uncle Sam got for you? The U.S. Department of Labor has a page of info for job seekers and the unemployed. See which government benefits/programs apply by visiting GovBenefits.gov.
Build that emergency fund. Important when times are ordinary. Vital when you’re unemployed.
An emergency fund out of thin air
In case of layoff: A financial fire drill
When you’re too broke for the basics
Swallow your pride – and seek aid
We have relatives who have been denied employment because of credit. I’m not sure how important it is for higher educated folks, but it can be make or break if you don’t have any post high school education.
@Nicole: Higher-educated folks can also be haunted by a bad credit report. Until recently I was an apartment-house manager, and all applicants had to submit to criminal and credit checks. Anyone carrying a lot of debt or who’d defaulted on loans or credit cards was either dismissed out of hand or required to pay an additional month’s deposit.
An article from Kiplinger’s notes that about 35% of potential employers will check your credit history on the theory that “bad credit can be a signal of irresponsibility, or employers might be worried you’ll spend more time fretting about your financial woes than concentrating on the job.”
That’s a bit of a generalization, and there are plausible reasons for bad credit (illness, long spell of unemployment, an ex who ran up the bills and then lit out for the territories). But there’s a grain of truth in the notion that people who are careless about paying bills may also be careless about rent. Here’s a tip for everyone: If you have to explain why your rent check bounced, don’t start the explanation with, “I was in Vegas and my boyfriend wrote a check from my old account.” It kind of puts the building owners off the idea of giving you a break on the NSF and late fees.
Thanks for reading, and for leaving a comment.
You know, this is something that needs to be addressed by federal regulation. There’s no good reason for an employer to be checking your credit rating to see whether you can do your job, especially in the current economic client where many people are losing their shirts for no fault of their own. It smacks of an unfair labor practice.
It makes sense to check a prospective renter’s credit, since the renter pays the landlord and the landlord has a vested interest in getting paid. But in the case of a job application, the employer is doing the paying, not the other way around. If anything, it’s more reasonable for the job applicant to get a credit report on the prospective employer, to ascertain whether the business owner or corporation is solvent enough to pay workers.
The idea is that someone with credit problems is more likely to steal from the company. I can see that making sense for a job that requires a security clearance… a person underwater might be more amenable to offers from Russian spies. But there has not been any correlation shown between being a good worker and having a good credit score. Especially these days. It’s just one way to winnow through the hundreds and thousands of applicants for each open position nowadays.
“economic client”? What on earth was I sniffing yesterday??