Save $5,000 a year on sneaky fees

Save $5,000 a year on sneaky fees

Companies collect billions by nickel-and-diming you. It's time to stop letting them get away with it.

By Kiplinger's Personal Finance MagazineThink
you've never been charged a sneaky fee by your bank, broker, credit
card issuer or cell phone provider? Then you haven't looked at your
bills very closely. The Internet has made it easy to
comparison-shop with a few clicks, so companies find it tougher to
raise prices. As a result, they've taken to boosting revenue by adding
fees on the back end. In 2007, Americans paid almost $30
billion in fees to credit card issuers, reports R.K. Hammer, a bank
card advisory firm. "Companies figure they'll throw in as many fees as
they can, and a large percentage of people won't complain," says Bob
Sullivan, the author of "Gotcha Capitalism." Don't
be one of them. If your bank, for example, suddenly slaps a $5 monthly
fee on your checking account, you're not necessarily bound to pay it.
In fact, you can save thousands of dollars a year if you pick your
battles and fight smart. Sullivan has his own tactics:

Call
during business hours. On weekends, few managers are available, and you
won't get the cream of the crop among lower-level representatives.

At Gethuman.com, you can find codes that let you circumvent company phone trees.

Do
your research and flex your muscle. Tabulate how much money you've
spent with a company, which can boost your bargaining power. If you
think you've been treated unfairly, don't hesitate to say you're
considering a letter to the state attorney general.

Don't
waste your time. A $2 fee may get your goat, but you can't afford to
fight every charge. Your chances of winning are directly correlated to
how much leverage you have. With financial services, such as banking
and credit, "consumers ultimately hold all the power because they can
vote with their feet," says Greg McBride of Bankrate.com. In fact, a
survey for Sullivan's book found that customers who complain to credit
card companies get results 65% of the time.

Below, we show you how to avoid the most annoying fees, and save $5,000 or more a year, by:

Reducing bank and credit card fees.

Beating back investment fees.

Zapping cell phone and land line fees.

Avoiding car rental and purchase fees.

Navigating around hotel and airline fees.

Reducing bank and credit card fees

When
Ilana Matfis moved from Sharon, Mass., to San Francisco, she figured
that ordering new checks from Bank of America would be a snap. But when
the new set arrived, "they'd spelled San Francisco wrong," recalls
Matfis, 25.After misspelling Matfis' name on the second order of
checks, the bank finally got it right -- then sent her a tab for all
three sets."The charges were only about $10 each time, but I had
to dispute them on principle," Matfis says. A customer-service
representative in San Francisco declined to issue a refund. So Matfis
called her branch back in Sharon, where an employee remembered ordering
the first batch of checks and agreed to remove all the charges. Video on MSN Money

Successful complaining
Customer
service can be a nightmare, but these tips should help you come away
from your complaint with a little more restitution.

There's
little hope of restitution for some fees, such as the $3 to $5 you'll
pay to withdraw cash from an out-of-network ATM, so it pays not to
stray. Or open an account with a bank that reimburses ATM fees. McBride
says that as long as your account isn't paying interest, you should be
able to qualify for free checking. If your bank balks, head elsewhere. Also
worth the haggle are fees for receiving canceled checks with your
monthly statement (up to $3), getting a replacement ATM card ($5),
making too many monthly transfers (up to $10) or using a live
representative instead of the phone tree (up to $2). The best
way to avoid the dreaded insufficient-funds fee, which averages $28 for
the first overdraft or bounced check and may increase as offenses pile
up, is to balance your account regularly. As an alternative, link your
checking account to a savings account so that overdrafts are covered by
your own funds. Expect to pay $5 to $10 for triggering the service, but
you'll avoid interest charges on an overdraft line of credit. The
success rate for challenging credit card fees is higher than with bank
account fees. Even supposedly nonnegotiable charges, such as
late-payment fees, aren't set in stone. "If you're a good customer, you can probably get late fees removed once a year," says Bill Hardekopf of LowCards.com. The tardy payment may still tarnish your credit score, but you'll be as much as $39 richer.Other
fees worth a phone call: the 3% many card issuers charge to transfer a
balance, the fee of up to $5 for a duplicate copy of a bill and the fee
of as much as $25 to rush you a replacement card.Companies have
to notify you when they add a new fee, but "it might come in a white
envelope that looks like junk mail," Hardekopf says. Sign up for
electronic delivery to stay on top of sneaky maneuvers.Beating back investment fees

Making
a buck on your investments is tough enough without watching your
profits nibbled away by fees that are pesky at best and punitive at
worst. The best way to avoid them is to deal with companies that offer
the best value for the services you want.Continued: Saving on commissionsLance
Cashion saved $3,200 in commissions over the past year by using a
broker that's in sync with his investing strategy. Cashion, a
33-year-old technology executive at an insurance firm, frequently
trades stocks and options. But the fees at TD Ameritrade "were killing
me," he says. TD Ameritrade charges $9.99 per online stock trade and
$9.99 for an options trade plus 75 cents per contract. So last
year Cashion made the switch to Zecco Trading, which offers 10 free
stock trades per month on accounts with $2,500 or more and charges
$4.50 per stock trade thereafter. For options, Zecco charges $4.50 per
online trade plus 50 cents per contract. "I'm going to go wherever the
free trades are," says Cashion, who lives in Fort Worth, Texas.But
commissions aren't everything. Cashion and his wife, Kathryn, keep
their retirement assets with TD Ameritrade because they like the
company's service. Online brokers now charge an average of $10
per stock trade, says Adam Honoré of Aite Group, a financial research
firm. That's considerably less than the $30 or more that full-service
brokers charge for an online stock trade. If you don't need the extra
attention, don't pay for it. Buy-and-hold investors
should avoid brokers that charge an inactivity fee. E-Trade, for
example, slaps a fee of $40 per quarter on account holders who don't
make any trades. Investors with smaller balances should also
mind account minimums. Vanguard, for instance, has a well-earned
reputation for low-cost mutual funds. But it charges an annual service
fee of $20 for each fund with an account balance of less than $10,000.
You can avoid the charge by signing up for electronic delivery of your
statements.To encourage customers to use electronic statements,
some companies charge for a paper trail. TD Ameritrade bills customers
$2 per month for paper statements. Transfer fees can hamstring
you if you want investment options that aren't on your company's menu.
Charles Schwab charges $25 to move part of your balance to another
company and $50 to move the entire amount. Video on MSN Money

Successful complaining
Customer
service can be a nightmare, but these tips should help you come away
from your complaint with a little more restitution.

Most
broker fees are clearly listed on a company's Web site or in a
brochure. One glaring exception is the 12b-1 fee, which is really a
sales charge in disguise. Funds may tack on the fee -- up to 1% of your
investment -- to their expenses, supposedly to cover marketing and
distribution costs. It's actually used primarily to pay brokers or
advisers who sell you the fund. Nevertheless, a fund is allowed to bill
itself as "no-load" as long as its 12b-1 fee is 0.25% or less per year.
And you'll have to check the fee table in a fund's prospectus to see if
it charges a 12b-1. If you build your own portfolio, selecting
no-load funds can save you more than 5% in sales charges. And over the
long term, the top-performing funds tend to be those with the lowest
costs. A fund's annual operating expenses (its expense ratio) are
calculated as a percentage of the assets you have invested. Invest
$10,000 in a fund with an expense ratio of 1.5%, and you'll pay $150
per year. Avoid stock funds that have an annual expense ratio
of more than 1.5% and bond funds with a ratio of more than 1%. If you
invest in a fund of funds, such as a target-date retirement fund, make
sure it doesn't charge a management fee on top of the expenses levied
by the underlying funds. Zapping cell phone and land line fees

Of
all the fees that cell phone companies can sting you with, high
"overage" charges often smart the most. The hefty penalty for using
more minutes in a month than allotted by your plan ranges from 5 cents
to 45 cents per minute. In 2006, shortly after finishing graduate
school at Stanford, Prashanth Ranganathan got slapped with a $246
overage fee. Incensed, Ranganathan, 29, built a computer program that
monitors his cell phone usage on his desktop.The program
automatically tracks his minutes by linking to his account via his cell
phone provider's Web site. With his friend Aniq Rahman, Ranganathan
created a Web site called WatchMyCell.
So far, more than 13,000 people have downloaded the free tool. You can
also monitor your cell phone usage by logging in to your account on
your provider's Web site. Text messages -- the bane of many a
parent's existence -- can cost up to 20 cents per message to send or
receive. So you (or your kids) can save by buying in bulk. T-Mobile
offers 400 text messages a month for $4.99; AT&T charges $5 for 200
messages. Switching to a cheaper plan and canceling a one- or
two-year contract triggers an early-termination fee that can run as
high as $200. To avoid that pain, try to transfer your service contract
to someone else. For a fee of $18 to $25, Web sites such as Celltradeusa.com and Cellswapper.com help match buyers and sellers. Avoid
overage charges and cancellation fees altogether by purchasing prepaid
service from companies such as T-Mobile, AT&T's GoPhone or Virgin
Mobile. Customers can cancel their service with no penalty, and monthly
rates are competitive.
_________________
Le Mensonge peut courir un an, la vérité le rattrape en un jour, dit le sage Haoussa
Ma devise:
se SURPASSER ,ne JAMAIS ABDIQUER,TOUJOURS RESTER HUMBLE

Continued: Taxes on cell phones
For
cell phone users, the most objectionable fees -- and often the most
difficult to decipher -- aren't strictly fees at all but the federal,
state and local taxes that can add a staggering 6% to 23% to your
monthly bills, depending on where you live (the national average is
15%). You can fight charges like these at the ballot box (sign up for
legislative alerts at MyWireless.org).
At
the same time, carriers pass along fees that look like taxes but aren't
-- a notable example being the Universal Service Fund fee, which
carriers are required to pay to promote affordable phone service. The
charge varies among companies.
You can't escape fees by using a
land line. Verizon, for example, charges a "dial tone" fee of $6 to $12
a month, depending on your state, to subscribers who buy basic service.

Bundling your phone with other services -- cell phone, cable TV
and Internet access -- can result in big savings. Or you could abandon
traditional carriers altogether in favor of Internet calling services
that use voice over Internet protocol, or VoIP, such as Vonage and
AT&T CallVantage. Rates generally run about $20 per month for local
calls and $25 per month for both local and long-distance service. But
VoIP providers still pass along regulatory fees and charges that will
add 10% to 15% to your monthly rate.
The only way to escape the
extra burden is to drop your land line altogether, or go with a VoIP
provider, such as Skype, that offers free service when the call is
routed from one computer to another and both parties use Skype software.
Avoiding car rental and purchase fees

Renting
a car is fraught with fees -- and most of them, unfortunately, are
nonnegotiable. But calling ahead to find out how much you'll be charged
at least guarantees that you won't be surprised. And you can avoid a
few charges by traveling smart.
The convenience of renting at the
airport or hotel will cost you extra. Expect to pay a "concession
recovery fee" -- typically 11% to 13% of your rental. Rental agencies
are simply passing the buck: They're charged a fee by the airport or
hotel to operate there. Avoid the extra cost by renting off-site
(unless a long cab ride will soak up your savings).
Companies
generally offer three choices for purchasing fuel: prepay for a full
tank when you rent, fill 'er up yourself, or pay the company's rate
when you return the car. Prepaid rates are often close to average pump
prices in the area. But unless the agency is giving you a discount, or
you return the car empty, getting your own gas is generally your best
bet because you won't be credited for leftover fuel.
Expect the rental company to pass along its annual cost to register the car. This fee (about $2 a day) is not negotiable.
The
collision-damage waiver is the most hyped add-on you'll see -- and the
least worth paying for. Your own auto policy generally covers
rental-car damage, and most gold and platinum credit cards pick up the
deductible. So skip the CDW; you're likely covered already.Video on MSN Money

Successful complaining
Customer
service can be a nightmare, but these tips should help you come away
from your complaint with a little more restitution.

Renting at a discount Web site, such as Hotwire.com,
will get you lower rates because the site doesn't disclose which rental
company you're working with until after you've paid. If you'd prefer to
know with whom you're dealing, Alamo, Avis and Hertz all provide
detailed full-fee pricing quotes on their Web sites, including taxes,
surcharges and fees.
You face substantially higher fees when you
buy a car because dealers are trying to recoup their costs for
everything from getting you in the door to completing the paperwork.
For instance, your state's fee to register the car is nonnegotiable.
But many dealers add $200 or so to cover the cost of doing the legwork.
Check with your state's department of motor vehicles to get the actual
fees, and go to the mat for the rest.
Documentation fees, which
could be a couple hundred dollars and cover the cost of doing the
paperwork, are legit. But they're often inflated, so negotiate them
along with the cost of the car. While you're comparing the invoice
price of the car with its sticker price, get the invoice price of
options, too, from Kelley Blue Book.
Whether
the options are from the manufacturer or port-installed (added after
the car leaves the factory), they're not included in the base price. If
you don't want the options, see whether the dealer has a model without
them. If not, haggle to as close to invoice price as possible.
Continued: Playing one dealer against another
Andrew
Beck saved more than $2,000 on his 2008 Mazda Mazdaspeed3 by knowing
how to play the game. "I pitted two rival dealers against each other,"
says Beck, who lives in Falls Church, Va. In the end, one dealer
lowered the price, gave Beck a good trade-in deal and dropped the cost
of the port-installed options. Beck even finagled his way out of the
$635 manufacturer's destination charge, which is usually considered
nonnegotiable.
Navigating around hotel and airline fees

High-tech
consultant Lindsay Wallroth spends 12 nights a month in a hotel room.
When she stayed at the Sheraton in Carlsbad, Calif., she often found an
additional $10-per-night "resort fee" tacked on to her bill.
"The resort fee is always a wonderful one," says Bob Jones, a travel expert with BookingWiz.com. "Hotels charge you because they have a swimming pool."
Jones
says it should be easy to talk your way out of this fee, which is added
by upscale hotels to pay for amenities such as spas and golf courses.
"Just say, 'I didn't walk through the garden you charge for,'" he
advises. "Generally, they'll be courteous enough to remove it because
they want you to come back."That strategy works for Wallroth, 27, who
now anticipates the fee and contacts the front desk before she gets her
bill. Hotel personnel are always quick to remove the charge, and
Wallroth estimates she saves $1,440 a year.
Wallroth, who lives
in Valencia, Cal., also objects to paying a mandatory charge of $9 per
day to use valet parking at the Marriott in Walnut Creek, Calif.
Choosing another hotel bumps her annual savings to $2,736. Other hotel
fees to watch out for: charges for telephone and Internet access, a
maid gratuity, a minibar, room service and energy usage.
Jones's
rule of thumb: "Always challenge a fee, especially if you don't
recognize what it is." To avoid charges from the get-go, call the hotel
directly when you're booking (not the toll-free number) and speak to
the manager, who's more likely to have negotiating power. Video on MSN Money

Successful complaining
Customer
service can be a nightmare, but these tips should help you come away
from your complaint with a little more restitution.

Fees can
start piling up long before you reach your destination. Many online
travel agencies, including Orbitz.com and CheapOair.com, charge $5 to
$35 extra for booking airfare. Avoid that charge by going straight to
the airline's Web site. Or use Kayak.com, Farecast.com or Airfarewatchdog.com to find the cheapest fare; all of them will redirect you to the airline when it's time to buy. (See "30 Best Travel Sites" for more.)
And
stick with purchasing an e-ticket online. Buying a ticket by phone or
in person or requesting a paper ticket will cost more. Delta, for
example, recently added a $25 "direct ticketing charge" when frequent
fliers call in or show up at a ticketing office to book a flight using
Delta SkyMiles.
The extra charge for checking a second bag is
gaining favor with airlines faster than you can say "Seriously?" United
started the trend by initially collecting $25 for a second checked bag.
Now, along with American, the airline is charging $15 for checking just
one bag, plus the $25 for bag No. 2. At Continental, Northwest and US
Airways, each extra bag after the first two costs $100.
The
Delta-Northwest merger will create a crazy quilt of extra fees. Delta
recently upped its fee for overweight bags and now charges $80 for a
suitcase that weighs 51 to 70 pounds. The new policies are expected to
rake in $100 million a year.
To avoid paying up, be aware of each airline's baggage policies. OneBag.com offers tips on packing light.
Ensuring
your comfort in the air will also cost extra at some airlines. JetBlue
touts its Even More Legroom seats, with an added 4 inches of space. But
getting one will cost you $10 to $20, depending on the length of the
flight. AirTran charges travelers with discount coach tickets $6 just
to choose their seats, plus another $20 to sit in an exit row. Both
airlines give you fair warning, so you can avoid these charges by
accepting the seat assignment they hand out.
This article was
written and reported by Elizabeth Ody, Thomas M. Anderson, Amy Bickers
and Stacy Rapacon for Kiplinger's Personal Finance Magazine.
Published July 22, 2008
_________________
Le Mensonge peut courir un an, la vérité le rattrape en un jour, dit le sage Haoussa
Ma devise:
se SURPASSER ,ne JAMAIS ABDIQUER,TOUJOURS RESTER HUMBLE