BLOG – Fees are foul. That’s why it’s Fee Free February

Last week my bank wrote to tell me that as of next month I’ll have to pay a $199 Annual Fee for my credit card.

I don’t use my credit card. It’s for emergencies. I got the card after my Dad had a heart attack. I’d had to book a flight to the UK late at night. The travel agent couldn’t accept cash. It was a bit of a fiasco. I figured a credit card could make life easier. It’s locked away in my filing cabinet ‘just in case’.

I’m not happy about paying the fee. $199 is a LOT of money.

Now, I’ll have to print out old pay slips, photocopy bank statements, trudge around the different banks at lunchtime, fill in forms, answer questions and spend a fair amount of time trying to get something I don’t actually intend to use.

Perhaps that’s why most of us our paying fees?  ‘Life Administration’ takes time. Sometimes it’s easier to just pay the fee.

Fees are everywhere. Absolutely everywhere.

There are payment processing fees, foreign transaction fees, merchant service fees, handling fees, card payment fees, shipping fees, postage fees and delivery fees. The list is endless.

Let’s say you go online to buy a book, or a cushion or a jumper. There’s inevitably a ‘card payment fee’ or a ‘processing fee’. It’s ‘just’ $3 here and $4 there. It doesn’t seem much. But when you add it all up, it’s a lot. Of course you don’t have to pay that fee. You can always pay a fee to ’join’ the store to avoid the fee!

  • Perhaps it’s easier to pay the fee than to spend another hour searching for another book, cushion or jumper?

Many shops and cafes charge a fee to pay with a credit or debit card, or insist you spend a minimum of $10. That’s annoying. Paying an extra $1 to buy a $3 coffee increases the cost of your caffeine hit by a third. The amount of money spent on fees really adds up.

Most online shopping websites charge fees for their online service or for using a credit card. The fees significantly add to the cost of your order.

  • If you could see the price ‘With Fees’ next to the ‘Pay Now’ price which would you choose?

Before you pay for your online shopping, you can of course check whether any additional fees have been added, and consider whether you’re willing to pay them.

  • If the price ‘With Fees’ was 20% more (or say $10 more) than the ‘Pay Now’ price would you still buy the thing you wanted to buy?
  • What if the $20 jumper became $35 with fees?

Are you paying fees and charges just for the sake of paying them?

If you are, it’s not your fault. And, you’re not alone. We’ve never been taught how to not spend money and not pay fees. It’s the expectation of our culture.

  • Do you pay fees when you shop online?
  • Does your credit card have an annual fee?
  • How much do you spend on fees each week?
  • How often do you pay a fee to buy things with a credit card?
  • In the last 12 months have you paid a fee to use your debit/credit card in a shop or with a business?
  • Have you bought more things than you needed to buy just because the shop imposed a minimum debit/credit card purchase fee?

The Underspent monthly challenge this month (February) is to free yourself of fees.

I’m Rachel Smith and I’m Underspent. I didn’t buy anything new or 2nd hand in 2014 and saved $52,680 (38% of my salary). I quit impulse shopping and saved my money. I changed my spending and transformed my savings. It started as a lifestyle experiment, but it changed my life, so I kept on going. I’m the Author of Underspent and I’m teaching people how to break the habit of impulse shopping in 7 steps through my Underspent book, free monthly challenges and my weekly blog.

The Underspent book is available in paperback ($12.99 or £7.40) and e-book, iBook and kindle formats ($2.99 or £1.70) in all online and high street/shopping centre book shops or buy a signed paperback copy ($12.99 + P&P) direct from me via my website www.cyclingrachelsmith.com. I’ve purposely made the Underspent book affordable. Email me about Bulk Orders (it’s a great resource for your staff, clients and customers) OR you selling my book at your bank/business/office/shop/café/school and you receiving 50% of the profits.