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CNN Live Today

Interview with Ilyce Glink

Aired August 28, 2002 - 12:42   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

KYRA PHILLIPS, CNN ANCHOR: If you get hit by a hurricane, a tornado, a flood, are you prepared? And we are not talking about your windows and your walls, we are talking about your wallet. It's easy to compound a crisis by making bad money decisions. Ilyce Glink wrote a book called "Fifty Simple Steps You Can Take to Disaster-proof your Finances."
She joins us now with some tips -- simple, huh?

ILYCE GLINK, AUTHOR, "FIFTY SIMPLE STEPS YOU CAN TAKE TO DISASTER-PROOF YOUR FINANCES": Simple is the way to go. You actually really don't need to make big, rash lots of stuff going on. Easy little steps to take, that is what is going to get you there.

PHILLIPS: All right. We are going to talk about the steps, but first of all, how do you define disaster?

GLINK: We always think now of September 11, it is not -- but that is not what happens to us personally. What happens to us personally is somebody loses a job, or somebody gets sick, or somebody dies, or a child gets sick. These are the kinds of curve balls we get in life. I want you to be prepared for them so that when the disaster strikes or the crisis hits, you can spend all of your emotional energy getting through the day and not worrying about your money.

PHILLIPS: Well, since September 11 happened, have you noticed a lot of people just not wanting to go deal with their finances?

GLINK: I think it is just the opposite. People have sort of woken up to the idea that wow, I don't have a will, or wow, I haven't named guardians for my children, or wow, where are my insurance policies, and who is named as beneficiary?

I think what we saw with September 11 was 3,000 people, and that just brought it home to you. You know, probably, that is not going to happen, but people do die unexpectedly. My own father dropped dead of a heart attack at 49. The inspiration for this book was watching my mother cope.

PHILLIPS: Yes, that is one thing I learned from my grandfather. He was very well prepared. It taught me a lesson. Definitely.

GLINK: Absolutely.

PHILLIPS: OK. So we put together the top money mistakes after a crisis. Let's go through some of these. We put together a list so our viewers can look. Here we go. Rash decisions. GLINK: You know, absolutely just running out, selling everything, selling the house, selling all of your stocks and bonds, and then what do you do? I want you to wait at least a year before you make a major financial decision. If you can afford to keep the house, I would like to see you do it, and make a logical decision about what you should do with the house before you end up somewhere across the country a year later.

PHILLIPS: OK. Number two. Neglecting finances.

GLINK: I think it is very important to understand that your money needs to be managed all the way through your life, so you know, not paying your bills is a common thing that happens when a crisis hits. You are too busy worrying about getting through the day. But if you have got these things automatically debited from your account, if you have pre-setup ways to pay it over the computer, somebody else can step in and take over that bill paying function for you so you don't pick up the phone one day and it doesn't work.

PHILLIPS: Number three, investing poorly.

GLINK: A mistake that we all make -- I mean hey, look at Enron, but I think for most people what that means is you want to make sure that when a crisis hits, that you've got your resources well mapped out so that you know what you have, you know what is coming and when, and you know what you can depend on, then you know what gaps you have to fill.

PHILLIPS: Under -- what is -- oh, under-insuring your assets.

GLINK: You buy a $100,000 house, and 20 years later, you still have a $100,000 homeowners insurance policy. That is great, except now it will cost three times that to fix your house and replace it in case it burned down or it flooded. So people don't understand sometimes that what you have to do is constantly look at your insurance policies and the coverages that you have, and sort of update them to sort of suit your new lifestyle and what you have, because things cost more. Inflation might be low now, but it won't always be that way.

PHILLIPS: And I am laughing because I got something in the mail last week to review and upgrade and do this and that, and oh, whatever, and my husband, What are you doing?

GLINK: It is. And what is really nice is insurance companies offer a service where they will send somebody to your house for free if you have no idea what your stuff is worth or the replacement cost for building your house.

PHILLIPS: All right. And finally, saving the house.

GLINK: Again, you know, people will sell the house because they have an emotional need to run away from the bad things that have happened. When bad things happen to good people, you kind of want to stick around to see what is going to happen. I said earlier, if you can keep the house for a year and then make a intelligent decision, a rational decision once you have moved away from the crisis, that is a better choice.

PHILLIPS: And you know what, I have got to tell you, I noticed this too when I went through the first death is that vultures come out of the woodwork. If you don't have your stuff in order, it is amazing the folks that come into the picture that try to take things from you and your loved ones.

GLINK: One of the biggest scams is that the criminals will actually read the death notices. They go to the funeral, and they say to you, Oh, Kyra, your former husband just wanted you to invest $10,000 with me. He was just going to give me the check, and you just hand it over because you are distraught. You are not thinking straight. Well, they prey on people like that, and it is very important to sort of know who to trust, know what to do with your money before something happens, because you are not going to be thinking about it afterwards.

PHILLIPS: Ilyce, great advice. "Fifty Simple Steps You Can Take to Disaster-proof Your Finances." Ilyce Glink. Thank you so much.

GLINK: Pleasure. Thank you.

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