To prompt for credentials, you should almost always use the Get-Credential cmdlet:

$credential = Get-Credential

Pre-filled user name:

$credential = Get-Credential -UserName 'myUser'

Add a custom prompt message:

$credential = Get-Credential -Message 'Please enter your company email address and password.'

The password in a credential object is an encrypted [SecureString]. The most straightforward way is to get a [NetworkCredential] which does not store the password encrypted:

$credential = Get-Credential
$plainPass = $credential.GetNetworkCredential().Password

The helper method (.GetNetworkCredential()) only exists on [PSCredential] objects.
To directly deal with a [SecureString], use .NET methods:

$bstr = [System.Runtime.InteropServices.Marshal]::SecureStringToBSTR($secStr)
$plainPass = [System.Runtime.InteropServices.Marshal]::PtrToStringAuto($bstr)

To store and retrieve encrypted credentials easily, use PowerShell's built-in XML serialization (Clixml):

$credential = Get-Credential

$credential | Export-CliXml -Path 'C:\My\Path\cred.xml'

To re-import:

$credential = Import-CliXml -Path 'C:\My\Path\cred.xml'

The important thing to remember is that by default this uses the Windows data protection API, and the key used to encrypt the password is specific to both the user and the machine that the code is running under.

As a result, the encrypted credential cannot be imported by a different user nor the same user on a different computer.

By encrypting several versions of the same credential with different running users and on different computers, you can have the same secret available to multiple users.

By putting the user and computer name in the file name, you can store all of the encrypted secrets in a way that allows for the same code to use them without hard coding anything:

Encrypter

# run as each user, and on each computer

$credential = Get-Credential

$credential | Export-CliXml -Path "C:\My\Secrets\myCred_${env:USERNAME}_${env:COMPUTERNAME}.xml"

The code that uses the stored credentials:

$credential = Import-CliXml -Path "C:\My\Secrets\myCred_${env:USERNAME}_${env:COMPUTERNAME}.xml"

The correct version of the file for the running user will be loaded automatically (or it will fail because the file doesn't exist).

$username = "[email protected]"
$pwdTxt = Get-Content "C:\temp\Stored_Password.txt"
$securePwd = $pwdTxt | ConvertTo-SecureString 
$credObject = New-Object System.Management.Automation.PSCredential -ArgumentList $username, $securePwd
# Now, $credObject is having the credentials stored and you can pass it wherever you want.


## Import Password with AES

$username = "[email protected]"
$AESKey = Get-Content $AESKeyFilePath
$pwdTxt = Get-Content $SecurePwdFilePath
$securePwd = $pwdTxt | ConvertTo-SecureString -Key $AESKey
$credObject = New-Object System.Management.Automation.PSCredential -ArgumentList $username, $securePwd

# Now, $credObject is having the credentials stored with AES Key and you can pass it wherever you want.