Home > Uncategorized > 10 Fees Frugal People Don’t Pay

Comments 0 Comments

Smart money management is as much about what you do as it is what you’re able to avoid. The money you save bringing a brown-bag lunch every day for a week can be erased with just one careless fee. Here are 10 fees the frugal avoid at all costs.

1. Shipping Fees

You can save a lot of money buying online as long as you don’t pay it all back with shipping fees. Smart shoppers find ways to get free shipping, whether it’s joining a program like Amazon Prime, looking for a coupon, or just buying enough to get over a dollar amount for free shipping.

2. Late Payment Fees

Late payment fees, assessed when you are late on paying a bill, are horrible because you get nothing for the fee and they are completely avoidable if you have a system in place. If your finances support it, auto-pay all your bills so you never experience a late payment fee. If they don’t, change all your due dates to the same day and set multiple reminders to pay all of your bills on that day. If you’re carrying a balance on your credit cards, it can impact your credit. You can see how your balances are affecting your credit scores for free on Credit.com.

3. Overdraft Fees

Overdraft fees are assessed when you draw a balance below zero. The solution, besides knowing how much money is in an account, is in having a good backup. Find a bank where you will have both a checking and savings account, with the savings account acting as an overdraft backup to your checking account. Many online banks offer this for free, which is crucial in avoiding any fees, so you get higher interest rates and protection against overdrafts.

4. Convenience Fees

Convenience fees are surcharges added to a bill when you pay with a credit card. This happens most often in situations where the payee only accepts cash and checks, which have no processing fees. Since credit cards assess a fee on all transactions, payees are looking to pass that fee to the customer. The fee will often be greater than whatever cash back or reward points you’d get for using a card.

5. ATM Surcharges

When you use an ATM that isn’t owned by your bank, you face two expensive charges. The bank that owns the ATM will charge you a fee to use the ATM, and your bank will charge you for using another bank’s ATM! This double whammy can get very expensive, especially if you make it routine. You could avoid using another bank’s ATM, but sometimes that isn’t possible. A better solution is to use a bank that offers to refund your ATM fee surcharges.

6. Partial Payment Fees

On some large annual and semi-annual payments, such as for automobile insurance, the company may let you split up the charge over several months in return for paying a slightly higher total amount. This partial payment fee isn’t explicitly listed; the installment payments are simply higher. Whether it’s car registration, property taxes, or some other large bill, save up so you can make the total payment when it’s due.

7. Foreign Transaction Fees

When you use your credit cards outside the United States, there may be a foreign transaction fee associated with each charge. The fee is a percentage added to the charge and ranges anywhere from 2% to 3%. You can avoid this by using a credit card that doesn’t charge you a foreign transaction fee, considered a valuable credit card perk for heavy travelers.

8. Checked Baggage Fees

If you travel a lot, you know that checking baggage can sometimes be an expensive proposition. Most airlines offer one complimentary checked bag but the charges increase if you check more than one. Be sure to include this additional cost in your flight comparisons since some airlines do not charge you as much for checked baggage (for example, Southwest Airlines offers two free checked bags).

9. Overweight Bag Fees

If your bag exceeds a certain weight limit, you may be charged an overweight bag fee that can get as high as $100 apiece. Know the weight limits of your checked baggage and use a scale to weigh your bags before you reach the airport. The worst place to open your luggage is in the airport in front of the ticketing counter!

10. Collision Damage Waivers

A collision damage waiver is the legal term for rental car insurance. When you rent a car, you’re responsible for any damages, and by electing the CDW you are waived of any responsibility for damage. This fee is usually overpriced, has a lot of exceptions, and redundant if you have auto insurance or a credit card that offers coverage. Before electing this waiver, check to see if you are already protected.

More Money-Saving Reads:

Image: Danilo Andjus

Comments on articles and responses to those comments are not provided or commissioned by a bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by a bank advertiser. It is not a bank advertiser's responsibility to ensure all posts and/or questions are answered.

Please note that our comments are moderated, so it may take a little time before you see them on the page. Thanks for your patience.

Credit.com receives compensation for the financial products and services advertised on this site if our users apply for and sign up for any of them.

Hello, Reader!

Thanks for checking out Credit.com. We hope you find the site and the journalism we produce useful. We wanted to take some time to tell you a bit about ourselves.

Our People

The Credit.com editorial team is staffed by a team of editors and reporters, each with many years of financial reporting experience. We’ve worked for places like the New York Times, American Banker, Frontline, TheStreet.com, Business Insider, ABC News, NBC News, CNBC and many others. We also employ a few freelancers and more than 50 contributors (these are typically subject matter experts from the worlds of finance, academia, politics, business and elsewhere).

Our Reporting

We take great pains to ensure that the articles, video and graphics you see on Credit.com are thoroughly reported and fact-checked. Each story is read by two separate editors, and we adhere to the highest editorial standards. We’re not perfect, however, and if you see something that you think is wrong, please email us at editorial team [at] credit [dot] com,

The Credit.com editorial team is committed to providing our readers and viewers with sound, well-reported and understandable information designed to inform and empower. We won’t tell you what to do. We will, however, do our best to explain the consequences of various actions, thereby arming you with the information you need to make decisions that are in your best interests. We also write about things relating to money and finance we think are interesting and want to share.

In addition to appearing on Credit.com, our articles are syndicated to dozens of other news sites. We have more than 100 partners, including MSN, ABC News, CBS News, Yahoo, Marketwatch, Scripps, Money Magazine and many others. This network operates similarly to the Associated Press or Reuters, except we focus almost exclusively on issues relating to personal finance. These are not advertorial or paid placements, rather we provide these articles to our partners in most cases for free. These relationships create more awareness of Credit.com in general and they result in more traffic to us as well.

Our Business Model

Credit.com’s journalism is largely supported by an e-commerce business model. Rather than rely on revenue from display ad impressions, Credit.com maintains a financial marketplace separate from its editorial pages. When someone navigates to those pages, and applies for a credit card, for example, Credit.com will get paid what is essentially a finder’s fee if that person ends up getting the card. That doesn’t mean, however, that our editorial decisions are informed by the products available in our marketplace. The editorial team chooses what to write about and how to write about it independently of the decisions and priorities of the business side of the company. In fact, we maintain a strict and important firewall between the editorial and business departments. Our mission as journalists is to serve the reader, not the advertiser. In that sense, we are no different from any other news organization that is supported by ad revenue.

Visitors to Credit.com are also able to register for a free Credit.com account, which gives them access to a tool called The Credit Report Card. This tool provides users with two free credit scores and a breakdown of the information in their Experian credit report, updated twice monthly. Again, this tool is entirely free, and we mention that frequently in our articles, because we think that it’s a good thing for users to have access to data like this. Separate from its educational value, there is also a business angle to the Credit Report Card. Registered users can be matched with products and services for which they are most likely to qualify. In other words, if you register and you find that your credit is less than stellar, Credit.com won’t recommend a high-end platinum credit card that requires an excellent credit score You’d likely get rejected, and that’s no good for you or Credit.com. You’d be no closer to getting a product you need, there’d be a wasted inquiry on your credit report, and Credit.com wouldn’t get paid. These are essentially what are commonly referred to as "targeted ads" in the world of the Internet. Despite all of this, however, even if you never apply for any product, the Credit Report Card will remain free, and none of this will impact how the editorial team reports on credit and credit scores.

Your Stories

Lastly, much of what we do is informed by our own experiences as well as the experiences of our readers. We want to tell your stories if you’re interested in sharing them. Please email us at story ideas [at] credit [dot] com with ideas or visit us on Facebook or Twitter.

Thanks for stopping by.

- The Credit.com Editorial Team