Sometimes, personal finance is a game of big steps: finally make the down payment on a house! See off the very last of your debt! At other times, though, it’s equally important to break out the magnifying glass and look at the small stuff. Whether at the bank, on the go or out for a night on the town, hidden fees are taking small bites out of your budget in lots of places. Some of these fees are fairly easy to avoid: keep an eye out for them and you will find that your budget suddenly has some extra room that you never would have expected.
ATM Fees – largely charged when you use ATMs that are not part of your card-issuer’s network. Look for a logo that corresponds to the bank that operates your account. Many third-party ATM providers (such as those often found in public venues like bars, restaurants and so on) also charge high percentage fees regardless of your bank. These definitely ought to be avoided!
Account Fees – Canadian regulations prohibit the advertisement of “free chequing” or “free savings” accounts unless they are legitimately free of any additional fees. Many options exist at a variety of banks. Even accounts that are not “free” by definition may allow users to waive fees if they meet certain usage criteria.
Overdraft/NSF Fees and Overdraft Protection – if your account is overdrafted – that is, you attempt to make a withdrawal greater than your balance – you will be charged a fee. Some banks offer the purchase of “overdraft protection” which will waive this penalty, however, it is better to simply keep a keen eye on your account status in order to avoid approaching an overdraft if possible.
Ticket Prices – entertainment providers, especially ticket sales platforms like Ticketmaster, are notorious for the service and handling fees that they add on to your purchases. In fact, the Canadian Competition Bureau recently sued Ticketmaster for deceptive practices, claiming that the price of a ticket could be inflated by as much as 65% by additional fees after taxes. One of the best ways to avoid these surcharges is to seek out tickets for your next night out at a local record store or promoter: you’ll be supporting independent artists and businesses, too!
Travel and Leisure – Unfortunately for those of us with irrepressible wanderlust, the travel industry is one of the most saturated with hidden fees and charges. Whether by plane, train or automobile, it seems like there’s always another play for your wallet when travelling by commercial means. There are more of these than I could hope to list, even in a blog dedicated just to them. One egregious example is the increasing prevalence in Canada of Ryanair-style “no frills” airlines like Swoop and Flair. Though the advertised ticket prices with these carriers might be low, airlines have also found themselves the targets of legal action and customer backlash for the range of surcharges and fees they impose upon travellers. Whether you want to check a bag, change a ticket, or even get an extra bag of snacks, you will find yourself being charged more than you bargained for! Even major national carriers are beginning to adopt similar policies, so it can be hard to avoid the sting of unexpected charges when you travel. However, you can do your best to keep costs down in a few key ways.
Pack Light – one of the easiest ways for airlines to add on extra fees to your ticket is to charge you for extra bags. Some fees exist if bags are oversized, additional beyond a certain number, or checked in as opposed to carry-on. If you can’t fit everything you need in a compact bag, consider taking less with you and making use of local resources once you reach your destination.
Book Early – When travel service provider Concur Canada analyzed 2.3 million Canadian air fares from 2014 to second-quarter 2017, it found booking seven days or less in advance costs 18 per cent more on average than if the trip had been booked more than two weeks early. Even a day makes a difference. Business travellers can cut that difference in half by booking even eight or more days in advance. Concur’s data shows flights to American destinations cost on average 44 per cent more when booked a week or less before a trip rather than at least 15 days before.
Hopefully, by being more aware of some of these hidden fees and employing our strategies to avoid them, you will be able to make sure that more of your money is going where you need it – and know where you don’t. If you ever feel surprised by a fee or surcharge that you didn’t expect, don’t be afraid to (politely) contest or negotiate with whoever is charging you. Consumers have a right to be aware of the full extent of what they will be charged, and your financial health shouldn’t suffer as a result of hidden fees!