How To Beat 10 Unnecessary And Insulting Fees

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Photo: Flickr / blatch

You give me something I want, we agree on a price, I pay for it. It’s the way the world has worked for thousands of years.These days? Not so much.

Today, with an increasing number of businesses, it goes more like this: You provide something I want, we agree on a price, I pay, then you tack on fees to fatten your bottom line.

Unreasonable fees are more than just a drain on your finances. They’re insulting – the financial equivalent of a cold slap in the face.

Now, in no particular order, here are 10 of the world’s most insulting fees. They made my list for one of three reasons: They’re unreasonable, you’re getting little or nothing in return, or they’re ridiculously overpriced.

Airlines: Checked baggage fees

Most major carriers charge $25 to check one suitcase -- a lot more if it's oversized, overweight, or both.

This fee didn't exist until recent years, and for good reason: The price of a plane ticket should obviously include luggage.

Isn't that an integral part of travelling long distance? No other travel-related services -- buses, trains, hotels, cabs, rental cars - charge for luggage.

This isn't a fee -- it's a sophomoric attempt to disguise a higher price.

Workaround: There are two major airlines that don't charge this insulting fee: Southwest and JetBlue. Fly them if you can.

If you can't, check this chart or one like it to see how much your airline is charging and use that as an incentive to pack light.

Some airlines also allow you to avoid baggage fees by using their branded credit cards. For more ideas, see 10 Tips to Save on Baggage Fees.

Airlines: Carry-on baggage fees

At least when you pay to check a bag, there's a service involved.

Someone has to load it, unload it, and make sure it gets safely back into your hands.

Charging for a carry-on bag is charging for nothing whatsoever. Nobody is touching your bag but you, and making this fee indefensible.

Fortunately, Spirit and Allegiant are the only airlines that do it, at least so far.

Workaround: Avoid flying Spirit, Allegiant, or any airline that charges for doing nothing. If they're the only airlines available, drive. If that's impossible, check with UPS or another freight carrier about shipping bags.

Airlines: Lap fees, pet fees

Banks: Credit card rates

While technically not a fee, the interest rates charged by many credit cards is outrageous.

Big banks borrow from the Federal Reserve at close to zero per cent, then lend money to credit card users at 15 per cent. Nice work if you can get it.

Workaround: The obvious solution is to avoid interest by avoiding a balance. But if you're going to pay interest, shop for a card with a lower rate.

Another idea? Simply call your card company and ask for a better deal. Tell them you're being solicited by other cards offering lower rates, because you probably are.

Banks: Foreign transaction fees

This is a fee charged on credit card purchases processed outside the United States; for example, when you use your card in Europe, or to buy something from a non-U.S. company.

Banks that charge them typically collect 3 per cent of every transaction. The implication of this insulting fee is that it's related to the intricacies of currency conversion.

But lawsuits have revealed these fees are nearly pure profit: money for nothing.

Workaround: If there's any chance you'll be making purchases outside the United States, use a card that doesn't charge this fee.

There are plenty to choose from: See Overseas With No Credit Card Fees.

Banks: Overdraft fees

If you overdraw your account and the bank uses its money to cover your negative balance, it deserves to be compensated. But how much?

According to this article at CNBC, overdraft fees average from $30 to $34 nationwide. Charging $34 for a one-week loan on the average overdraft of $36 equates to an annual rate of 5,000 per cent.

Workaround: Link your savings to your checking account for overdraft protection. This might result in a transfer fee, but it will be lower than an overdraft fee.

Banks: Checking, loan, and other banking fees

Not paying interest on your checking account is bad enough.

But now banks want you to pay -- often upwards of $100 a year -- just to have an account. Want a paper statement? Not long ago that was your only choice. Now it will cost you.

Why should you pay to use an ATM, even another bank's? You're saving the bank money, not costing them.

When you use the automated checkout at the grocery, they don't charge a fee. Banks shouldn't either.

Workaround: There's no reason to get slapped around by any bank. If you hate yours, ditch it.

Credit unions typically charge lower interest on loans and credit cards, pay more interest on savings, and have lower overall fees than banks. Think they don't have enough branches? You're probably wrong.

Many credit unions belong to a shared branch network of nearly 5,000 locations that allows members of one credit union to conduct business at any other member credit union anywhere in the country -- even overseas.

And when it comes to finding the nearest participating credit union? Yes, there's an app for that.

Hotels: Resort fees

The concept of paying to stay at a hotel, then paying more to use on-site amenities is ridiculous.

The FTC recently sent a warning letter to 22 hotels, accusing them of potentially violating the law by bumping up the prices listed on their online reservation sites with hidden fees.

From their press release

One common complaint consumers raised involved mandatory fees hotels charge for amenities such as newspapers, use of onsite exercise or pool facilities, or Internet access, sometimes referred to as 'resort fees.'

These mandatory fees can be as high as $30 per night, a sum that could certainly affect consumer purchasing decisions. The warning letters also state that consumers often did not know they would be required to pay resort fees in addition to the quoted hotel rate.

Workaround: Before you book a reservation, find out in advance what fees you'll be expected to pay, and if you hear something you don't like, just say no.

In 8 Tips to Save at Any Hotel -- Even the Nation's Trendiest, I suggested a tactic I've been using to get better hotel pricing for decades: negotiate. Explain that you're a good customer, don't find the fees fair, and would like a lower price.

Just make sure you're talking to a front-desk decision-maker, not an 800-number.

Hotels: Internet service

When the Internet and Wi-Fi were new, perhaps it was justifiable to charge a fee to access it.

These days, charging for Internet access makes as much sense as charging for the in-room TV or air conditioning.

$15 a day? Give me a break.

Workaround: If you can't find a hotel with free Wi-Fi, ask to have the fee waived when you check in. If that's not an option, find it free elsewhere -- either in the lobby or a nearby hotspot.

Free apps like WeFi, available for iPhone and Android, will help you find one.

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