financial goal

Are Hidden Fees Costing You Your Financial Goals?

Have you ever gotten a bill and found you were charged more than you expected to be? Most Americans have had this experience. Vague charges labeled as “service fees” or “other” leave you not only responsible for sending over more of your hard-earned money, but completely unsure of what your money is actually going towards.

Often, these fees are ones you shouldn’t have to pay at all, but companies know you’re unlikely to argue against them. The good news is that nearly ? of people who fight back against fees get them refunded or removed. To become part of that group, you first need to learn how to spot hidden fees. Next, you’ll need to know the best channels for getting them removed.

Most Common Hidden Fees & Charges

While unfair fees can come in many forms, some sneaky charges are more popular than others. For example, cable, phone, and internet companies are big fans of offering temporary promotional prices. For your first year of service, you get a reasonable price, but the next year (and so on) your price is significantly higher.

But you can easily cancel after the promotional period, right? Not necessarily. Cancellation fees can be high, you can be charged for someone to pick up an internet router, and you’ll be reminded of the startup costs if you choose to become their customer again later.

Ideally, before signing up for services, you can convince a representative to warn you about hidden fees, but you still might end up with them. To spot unnecessary expenses, you need an itemized bill where the charges are broken down. Sometimes this is already provided to you and other times you will need to request it. Once you can see the breakdown of costs, look out for vaguely named fees you may not be responsible for paying. 

Some of the most common hidden charges include:

  • Miscellaneous charges
  • “Convenience” fees
  • Connectivity charges
  • Membership
  • Overdraft fees (banks pull in billions of dollars in overdraft fees each year)
  • Account Closure fees
  • Service fees

When you spot some of the hidden fees above, it’s possible you are being unfairly charged and don’t have to pay all of them. In the case of phone companies, federal law actually prohibits them from using misleading language when describing services on your bills. Let’s take a look at a notorious perpetrator for adding unexpected fees: AT&T.

Hidden Fees AT&T Charges

When you add up all the possible extra fees you could end up paying AT&T, the service becomes very expensive. If you rent their equipment (which is required), you can expect to pay an extra $10/month. There is a data overage fee of $10 per 50GB, setup & installation fee of up to $149 (self-installation still costs a $49 activation fee), and a cancellation fee of up to $180.

Last year, AT&T added on another fee. Since 2017, AT&T has been passing its property-tax costs onto business customers. They used to charge a 3% fee and have now more than doubled it to 7%. This increased price includes people who are locked into a contract. 

With this method, AT&T can advertise a lower price than customers actually pay and they can raise customer bills whenever they want to. Anybody who decides to cancel because of the new increased rate is required to pay early termination fees. While charging customers your property tax isn’t standard, AT&T isn’t even close to being the only company cramming in hidden charges. Fortunately, there are ways to fight against these types of unfair fees.

How to Get Hidden Fees Removed or Reimbursed

When you discover unnecessary charges on a bill, you have more options than paying more or canceling the service. In some cases, you can simply call a company’s customer service line and ask to speak to someone about the charges. If you’re lucky, that person will have the power to remove charges or reimburse you for unfair fees you’ve already paid.

Other times, legal action might be required. For example, suing AT&T involves checking claims requirements, sending a demand letter, filling out court forms, filing complaints, showing up to court, and more. For more information, you can read a complete guide on how to take legal action against AT&T. If that process sounds like too much work and money, you also have the option to hire a company to create a legal claim for you so that you only pay if you win. 

While you can’t keep companies from slipping in mysterious fees, you can become skilled at noticing and fighting those fees. Start paying the prices you were promised and not the prices businesses would prefer you to pay. Once you’ve successfully saved your money, make sure to encourage others to do so too. If we’re all transparent about the charges we’re avoiding, maybe companies will start to be more open about the fees they’re charging. 

Hannah Kowalczyk-Harper

Hannah is a writer who’s passionate about topics related to personal finance and consumer rights. She works with FairShake, a platform designed to help individuals navigate the arbitration process and get justice from big companies.

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