I just finished reading 15 most hated fees at CNNMoney.com. Included on their list are many you’ve heard before such as:
- baggage fees
- termination fees charged by cell phone companies if you cancel before your contract ends.
Neither of those fees bug me, however.
You: Why not?
Because they’re not hidden.
You: Meaning?
I know about them well in advance and choose whether to pay them.
You: Why would you ever choose to pay a fee?
I typically don’t. But I have done so.
You: When? Why?
Baggage Fees
For example, I usually don’t check a bag when I travel for business. Most of my trips are short enough that I can fit everything in a carry-on. (I have always traveled light, even before advent of baggage fees). But I once had an 11-day business trip. Carrying everything in one small bag wasn’t in the cards, so I checked my one bag.
You: So you paid the fee.
Yes, which was no big deal. When I shopped air fare, I knew that the airline I selected charged the fee and, even with it, would prove to be the least expensive option with a reasonable itinerary. Next month, I am traveling with my entire family and we’ll pay baggage fees on that flight too. So what? It’s as though the airfare was a bit more expensive, but I included the fee when I determined this was the best option. Why do people complain about fees disclosed in advance?
Termination Fees
You: What about cell phone termination fee charges? Those are annoying.
I don’t pay those.
You: Why not?
Because, as you said, they’re annoying.
You: How do you avoid them?
Easy, I just fulfill the contract. Then, if I’m in the mood for a change, I switch carriers. The carrier can’t increase my rate during the contract term and I can’t quit without a paying them a fee. Seems perfectly reasonable to me. A contract is a contract. No one forces you to sign it.
Yet there are some other charges we allegedly hate, according to the article, including:
Low/No Activity Fees
I would never pay a fee for not charging enough on my credit card. Wow – that would annoy me.
You: Is it fair?
Yes. But I wouldn’t pay it – I would cancel the card. More likely, however, is that I would never face that fee in the first place.
You: Why not?
Because I have two credit cards and I use them both. If I had another credit card and wasn’t using it, I would cancel it, even if I didn’t face the prospect of the fee.
Frequent Flier Mile Fees
I don’t recall ever having to pay to pay to use my frequent flier miles, but I’m pretty sure I’d be annoyed by anything advertised as free that wound up not being so. This would be especially true if the deal changed over time, which it appears is the case with US Airways.
Annuity Fees
I don’t pay these. I’m not a big fan of annuities for non-retirees anyway so no annuity fees for me.
Credit Card Rewards Reinstatement Fees
Easily avoid: pay your bill on time. You shouldn’t need a reward to do so – basic financial responsibility. This fee is reasonable.
Closing an IRA Fees
Paying to close an IRA is an evil fee in most cases.
You: How could this not be an evil fee?
I can see it being fair if you open your account on Monday and close it on Friday. The financial services firm is taking a big hit on you there. But, short of that highly improbable scenario, this is not a reasonable fee. You can still avoid the impact of it, however, as the article suggests, by negotiating for the company to which you are moving your assets to pay the fee to get your business.
You: But -
Not moving your money but instead cashing out your IRA to buy a car you obviously can’t afford? I have no sympathy – you are hereby deemed fee-worthy.
Mutual Fund Marketing On You Fee
The 12b-1 fees charged by many mutual funds do nothing to help existing shareholders. Such fees are a concept that have passed their time. Yet they, too, are well disclosed. Don’t like them? Choose different funds. See? Now I even have homework.
Want more? Here are my 10 stupid and careless ways to waste money, Ten Ways to Save Money While Ruining Your Life, and my Top 10 Most Annoying Ways to Lose A Little Money.
What fees do you deem worthy and absurd?
Tags: fees
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