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ALL ABOUT “HIDDEN FEES”

ALL ABOUT “HIDDEN FEES”

ALL ABOUT “HIDDEN FEES”

Does this sound familiar? You decide to take advantage of a special offer of $99/month for your mobile phone plan, but when you get your first bill the amount due is $120. You contact the service provider, who tells you the base rate is indeed $99, but the balance is for “handling and administrative fees.” Whoa. Why didn’t they tell you that up front? Or did they, but it was in the endless small type that almost no one ever reads.

Hidden fees are more common than you might think. In April, Consumer Reports did a poll of 2000 adults. The results: 85 percent of Americans have encountered an unexpected or hidden fee over the past two years for a service they had used, and not surprisingly 96 percent said they found it annoying. The largest number of respondents – 69 percent – said they had been charged hidden fees by cable, internet or phone services.

If there is any good news in this scenario, it is that there are ways to fight back against hidden fees. Here is what you can do:

  • Contact the provider to complain about the fees. If the company will not reduce or remove the fees, you may want to announce your intention to cancel the service. In some cases, a provider will work with you in reducing the fees.
  • Contact your elected officials to complain about the hidden fees. In recent years, the government (state and federal) has not been active in regulating or reducing a company’s right to charge you extra fees. Public pressure, in some cases, may help encourage legislators to take action.
  • Be a proactive consumer. Before you sign on the dotted line for a new service, ask for a full report of additional fees. Shop around for competitively priced services, and determine which one has the fewest and lowest priced additional fees. Then, work with the provider to negotiate the fees down or get them eliminated.
  • If you are already a customer, and you can determine that you are being charged fees that were not communicated to you up front, contact the Better Business Bureau or an appropriate government consumer agency.

Be aware that some companies are counting on the fact that you never look at your bill, and if you do not, you are not alone. More people than ever have their bills set up to be paid automatically online. Further, it is common now  to go paperless, which means your bill is provided to you via email. You may notice that many companies will send you an email with the required amount and the due date, but then require you to click through to their website to actually view your detailed bill. Some companies count on the possibility that you will not go to all that trouble to see the itemized bill. That means many people are not even aware of what additional fees they are being charged.

Just to offer some perspective on how much companies profit by hidden fees, consider airline companies. Consumer Reports reveals that baggage fees and reservation change fees accounted for $7.6 billion in revenue in 2018. Is it a racket? Not really, because all of the fees you are charged for any service are clearly stated somewhere in your agreement, even though they may be hard to find and difficult to interpret. If nothing else, you may benefit financially by simply taking the time to read the small print – every time.

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