When you move forward with a purchase or sign up for a service, you’ll likely feel pretty confident that you know how much it costs. That’s why a total far above what you were expecting is so alarming. It leaves you feeling deceived and potentially wreaks havoc on your budget, neither of which is pleasant. Fortunately, by learning about sneaky hidden fees, you can take steps to avoid them. Here are ten sneaky hidden fees that you shouldn’t be paying.
1. Hotel Fees
When you reserve a hotel room, you might assume the price you’re presented is all you’ll need to pay. However, some properties charge far more in the way of fees. You may own a resort fee to cover access to gyms or pools, even if you don’t intend to use them. Parking fees, safe fees, online reservation fees, early check-in fees, and Wi-Fi fees might all be part of the equation, too.
Since some fees aren’t apparent until you check in, it’s best to contact hotels you’re considering in advance to find out. That way, if you encounter a cost you’d rather avoid, you can book different accommodations instead.
2. Balance Transfer Fees
Many cards advertise low balance transfer interest rates to entice people to apply and convince them to shift balances over from other cards. While the low-interest rate is a positive, balance transfer fees could wipe out any savings.
While balance transfer fees can vary, some may cost up to 4 percent of the amount you’re bringing over. For a $1,000 balance, that means paying a $40 fee – an expense that usually gets added to your balance, allowing interest charges to occur on that amount, too. For a $10,000 balance, that’s a $400 fee.
In some cases, avoiding this fee entirely is challenging or impractical. However, you can focus on cards with lower balance transfer fees. Otherwise, make sure that the fee doesn’t offset all of your interest savings. That ensures you come out ahead overall, even if you have to pay the fee.
3. Homebuying Fees
Many first-time homebuyers are taken aback by the number of fees they’ll encounter during the home purchase process. While they might anticipate loan origination fees from a mortgage provider, many people aren’t familiar with the rest until they’re asked to pay.
In the end, many homebuyers have to cover title search, home appraisal, home inspection, and survey fees. There’s also earnest money which – while not a fee, perse – adds to the upfront cost of pursuing a particular property.
Some of the fees may be negotiable, allowing you to potentially reduce them. However, others are based on going rates in your local area, making them fairly set.
4. Prepaid Card Fees
Prepaid cards can seem like a safe, convenient way to pay for a range of goods and services. Most have a Visa, MasterCard, or American Express logo, allowing you to use them anywhere that card type is accepted and making them more versatile than many store gift cards. Plus, you can reload them in many cases.
However, most prepaid cards are laden with fees. Along with activation fees, there may be swipe fees, maintenance fees, reload fees, inactivity fees, and more. If you don’t review the fine print, you may find your balance mysteriously dwindling, potentially leaving you in a bind.
Finding a prepaid card without any fees is incredibly difficult. As a result, it’s best to only use these under specific circumstances. Additionally, read the fine print to ensure you know what to expect.
5. Delivery App Fees
While ordering through delivery apps like DoorDash or UberEats might seem convenient, you do pay a price for having items brought to your door. While many people notice the delivery fees, as they’re often clearly listed and the companies regularly release discount codes to reduce them, the service fees tacked on by the company are often unclear until you reach checkout.
Plus, those service fees can be shockingly high. In many cases, they’ll add a few dollars to the total, at a minimum. Couple that with the cost of tipping a driver, and your order could easily cost $10 above the total cost of your goods or meal.
Then, there’s the fact that some establishments list higher prices on the apps than you find in-store. Since that “fee” isn’t noticeable unless you know the typical cost of items you’re ordering, it can push your total up in the sneakiest way possible.
6. Foreign Transaction Fees
If you head overseas, purchases might cost notably more than you expect, all because of foreign transaction fees. Some credit and debit cards make those costs seem normal and unavoidable, leaving travelers assuming they have no choice but to pay.
In reality, there are several ways to sidestep this cost. Choosing a credit card that doesn’t charge foreign transaction fees is a solid choice, giving you the protection and convenience of a credit card while limiting costs. Otherwise, you can stick with cash while traveling.
7. Out-of-Network ATM Fees
Using an ATM that isn’t part of your bank’s or credit union’s network can come at a cost. Some ATMs charge out-of-network fees of more than $4 per transaction, taking a surprisingly big bite out of your balance for simply accessing your own money.
Fortunately, out-of-network ATM fees are largely avoidable. You can either plan ahead, ensuring you head to a “friendly” ATM, or choose a bank that reimburses any fees you encounter. If you’re stuck without an in-network ATM nearby and your bank doesn’t reimburse, do a little research to find low-cost ATMs in your area. Some may charge $4+, while others might only charge $0.50, so it’s worth taking a look.
8. Bank Account Service Fees
A surprising number of bank or credit union accounts come with monthly service fees. Fortunately, this is an expense you can completely avoid with a bit of planning.
Most banks or credit unions that have the fees also outline conditions that allow you to avoid paying. For example, you may need to set up a direct deposit, have a certain number of debit card transactions monthly, or maintain a particular balance. By meeting the conditions, the fee is waived.
However, if you’re worried about meeting the conditions, you can simply go with a fee-free account instead. Many banks and credit unions have account options that don’t come with monthly service fees, so open an account there to ensure you won’t get caught with an unexpected cost.
9. Airline Fees
Air travel isn’t usually cheap, even if you just look at the tickets. When you add in hidden airline fees, the cost can get out of hand fast. There can be charges for checked baggage, overweight bags, choosing your own seat, selecting “preferred” seats, and having a meal. There can also be “convenience” fees for paying for your ticket using specific methods.
If you book your tickets over the phone or in person, you might get charged a fee for using that approach. Using in-flight Wi-Fi typically comes with a cost. In some cases, redeeming your frequent flyer miles may even trigger a fee. So keep that in mind if you’re planning on using them.
Whether these fees are avoidable depends on several factors, such as the airline you choose, how you want to book, and how you want to pay. Since that’s the case, it’s wise to research all of your options, allowing you to find the lowest-cost approach that meets your needs.
10. Overdraft Fees
In many cases, overdraft fees are massive, typically running at $20 to $30 per transaction that clears once your account reaches $0. Fortunately, this is an expense you can avoid entirely. By opting out of overdraft protection, your card will get declined instead of approved if you don’t have enough cash to cover the purchase. While that’s inconvenient, it’s better than getting hit with a massive fee.
If you don’t go that route and haven’t overdrafted your account in the past year, you could call and request the fee be removed. Most banks or credit unions will waive one overdraft fee annually, so it’s worth making the call if it was a simple mistake and isn’t likely to occur again any time soon.
Are you aware of any other sneaky hidden fees people should avoid? Did you ever spot a hidden fee before paying and decided to intervene or find another solution? Have you ever noticed a hidden fee after the fact and were annoyed that you didn’t spot it fast enough? Share your thoughts in the comments below.
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Tamila McDonald has worked as a Financial Advisor for the military for past 13 years. She has taught Personal Financial classes on every subject from credit, to life insurance, as well as all other aspects of financial management. Mrs. McDonald is an AFCPE Accredited Financial Counselor and has helped her clients to meet their short-term and long-term financial goals.