12/16/2011 6:01 PM ET|
The stupidest fees of 2011
When it comes to outrageous fees imposed on consumers, these are some of the worst -- whether it's a charge for ending pay-TV service or a fee to deposit a lot of cash.
A lot of companies tried to hit you with stupid fees in 2011.
There were baggage fees for travelers, resort fees for people who stayed in hotels, fees to pay a bill -- online or offline -- and even a fee for printing out your concert tickets at home.
So a fee really had to rise above the ordinary to win the mantle of stupidest. And the following surely did.
Not all of these fees were new in 2011. In fact, some have been around for a while. But they've all drifted to the top of my list of stupid fees for being even more ill-considered, counterproductive, anti-competitive or unfair than the rest of the fees we've come to know and hate.
Debit card fees
The most infamous fees of 2011 were some that had targeted millions -- but that few people actually ended up paying.
After Congress limited how much banks could charge merchants in transaction, or "swipe," fees to accept plastic, several banks announced plans to begin charging their customers monthly fees to use their debit cards. The banks said they were forced to do so to make up the revenue lost to the new caps. (Banks had been charging an average of 44 cents per transaction, although a Federal Reserve survey suggested their actual cost averaged 13 cents. The fees are now capped at 21 cents.)
The backlash to the proposed debit card fees was immediate and fierce. Politicians and pundits criticized the banks for being tone-deaf. A $4 or $5 monthly fee might not seem like much to a well-paid bank executive, but it was significant to a customer base struggling with high unemployment, a bad economy and a lingering resentment over multibillion-dollar bank bailouts.
The banks caved. JPMorgan Chase and Wells Fargo pulled the plug on the pilot programs they had planned to test in a few states. Two other banks that had started charging the fees, SunTrust and Regions Bank, canceled their programs as well.
The last to give in was Bank of America, which announced on Nov. 1 that it wouldn't begin imposing the fees in January, as it had planned.
Boarding pass fees
Spirit Airlines bills itself as a low-cost carrier, but it's found even more ways than most other airlines to boost its revenue through add-on fees. It was the first (and so far only) carrier to charge for carry-on baggage, in addition to charging a higher-than-average fee to check bags. Just booking a ticket incurs a $10 "reservations booking fee" and a $16.99 "passenger usage fee."
The airline recently slipped in a new charge: $5 for having your boarding pass printed out at the counter, rather than getting it from a kiosk or printing it at home.
Airlines have made a science out of charging for what used to be provided free with the cost of the ticket. The proliferation of airline fees has made it tough for consumers to get true apples-to-apples comparisons of flight prices. The better travel search engines add in any required fees and taxes, but they typically don't allow you to price out your luggage costs or factor in other fees that vary from carrier to carrier, such as charges to reserve a seat in advance. Too often, you don't know what you're really going to pay until you're at the airport.
Still, some airlines do seem to be trying harder than others to come up with new ways to gouge their customers. If you want a better (and ultimately cheaper) travel experience, you might want to go with an airline that isn't so interested in "gotcha" fees. Southwest Airlines comes to mind.
Early-termination fees for TV service
Pay-television providers are adopting a page from the cellphone carriers' playbook: walloping departing customers with fat early-termination fees.
Bailing on Verizon's Fios service before two years are up will cost you $230 to start, with a $10 monthly prorated reduction. The two major satellite providers, Dish and DirecTV, charge $17.50 and $20 a month, respectively, for each month of the two-year contract that remains -- which could leave you owing well more than $400.
The pay-TV providers say they need to make up for the high cost of the fancy equipment they're installing in your home, because charging you $75 a month or more just isn't enough. But some customers complain that they weren't told of the fees and that they didn't realize they were signing up for a two-year contract when they installed the service or got an upgrade. Some say they were charged even after it turned out the provider couldn't deliver service.
DirecTV, in particular, has run into trouble with regulators over its practices. Late last year, DirecTV reached a settlement with all 50 states and the District of Columbia on a variety of matters, including its cancellation penalties. Consumer advocate Mitch Lipka, who has called DirecTV "one of the most complained-about companies in America," says the settlement came almost exactly five years after the company reached a 22-state settlement over similar accusations.
Given the amounts of money involved, pay-TV providers need to do a better job of disclosing the fees and making sure people know what they're getting into. A bunch of teeny-tiny type buried on a website or at the bottom of a work order just doesn't cut it.
VIDEO ON MSN MONEY
I am a firm supporter of capitalism and free enterprise. I do not favor excessive government control and regulation.
However, there has to be some degree of government oversight and laws with teeth in them to protect consumers.
Just think of how many consumers would be scammed and the number of "snake oil" salespeople who would waiting to empty your wallet if capitalists were simply allowed to do as they damn well pleased!
The success of capitalism is dependent upon an "honor system".
When that honor system isn't honored, government oversight is necessary.
Government regulation in America almost always follows public outcry.
Expecting the capitalist system to police itself is like letting the fox guard the henhouse.
As we all know, too, when the cat's away the mice (or rats) will play!
American's do not know how to revolt like people did many years ago. We like to complain but when someone suggests to stop living the way we are living we say "i can't, i need this.. I need that.. can't live without this...can't live without that." That is why oil companies can charge whatever they want for gas becasue they know people will not stop driving. Airlines can charge all these fees because people will not stop flying. Between greed and laziness, these issues will not change because people refuse to live differently. Americans stuggle to understand what sacrafice is and struggle more to excercise it. We need to change the way we live and stop prioritizing things that we really do not need.
We completed our contract with Directv and then they tried to raise the price again! told them no, so they left it alone. A year or so later they did it again. Told them no and they said 'fine, we owed them about $400 for 'equipment'.' I said no again, and they filed a claim against my wife's credit!
I sued the pieces of chit for $5,000 in our local court. Let's see how that turns out!
I'd be happy to tell you what I think,
but I'll have to charge you an "Opinion Service Charge".
This has gone past riduculous.
WE NEED TO BOYCOTT SOME OF THESE PLACES!
"Doc fees" when you buy a car. Car dealers have been charging this "made up" fee for years. The government should make them call it, additional dealer profit fees, because that is all it is.
Fair and Balanced 78:
Totally agree that corporations have a right to make a profit. However, they DO NOT have the right to gouge.
This is certainly true, but in addition this it is a tax on your speech, a direct violation of the constitution. where are those guys that have sworn to up hold the Constitution of the United States? OH! they are out busy trying to take more from the citizens. Have you ever noticed politicians are always running, for office, to fix the problems they started in the first place.
Take your money out of the large banks and put it into credit unions and small home town banks... don't pay fees to use your money.....
To fair and balanced below: not only do they want to make a profit (huge) they ask us to bail them out to the tune of billions... so which is it? If they want the large sums of profit let them bail themselves out... They want their cake and eat it too....
Now, thanks to the Supreme Court they can buy elections with that profit... where does it end?
Wake up America and do not participate.
P.S. I am not leaving America I fought for my right to be here and say what I wish.. Did you?
Copyright © 2013 Microsoft. All rights reserved.
Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.
MORE PERSONAL FINANCE SECTIONS & TOOLS