CALIFORNIA, USA — Have you ever bought concert tickets only to find yourself paying a lot more money than you expected as fees are added at the end of the purchase? Well, there's a name for those fees that seems rather fitting.
Junk fees are those annoying hidden charges and bogus extra costs driving up things like hotel and ticket prices.
They’ve gotten a lot of attention recently. So much so, California is now banning them and the White House is also calling for a crackdown. But, it doesn’t stop there. Now the government wants to hear from you.
“A lot of us can relate to paying junk fees," Maureen Paley said.
Paley is a Sacramento-based financial coach who says junk fees come in many forms.
"There’s a convenience fee, an administrative fee — when you book a hotel there might be a resort fee. When you book concert tickets there might be an extra charge you weren’t expecting," Paley said.
The Federal Trade Commission says these fees cost consumers tens of billions of dollars per year in unexpected costs.
"We are still feeling that pinch of inflation so our dollars really aren’t going as far as we’d like them to," Paley said.
The FTC says junk fees aren’t just for travel or entertainment, they can sneak up on your rent, banking, and utility bills.
"Any extra fee that is not so much about the service provided, but more so about building revenue for that business entity that we’re purchasing from, having that reduced for our benefit is going to take some pressure off," Paley said.
The FTC and the Consumer Financial Protection Bureau want to hear from you.
"It’s not often that we get invitations from institutions to hear our feedback, so this is the time to do it," Paley said.
To help these federal agencies understand how junk fees impact your financial life, people are encouraged to share their stories and insights.
The FTC says it received more than 12,000 comments and has extended its deadline for comments on its proposed ban on junk fees.
"It’s best to keep it simple and factual," Paley said. “... you want it to be read, and you want it to have an impact.”
A big question is whether fewer junk fees will mean more money in your wallet.
Experts say companies may lower junk fees, but raise prices in other ways to make up the difference. The bottom line is you are in control of your money and how you want to spend it.
"If we’re at the end of the transaction and there is a surprise fee that we’re not willing to pay, that’s over our budget, we don’t have to pay it," Paley said.
California’s junk fee ban takes effect July 1. People have until February 7 to tell the FTC their junk fee story. The Consumer Financial Protection Bureau’s deadline is in April.
Tips to Avoid Junk Fees
- Read the fine print for anything you buy online or when you sign up for a new service or financial account.
- If you don't understand the reason for the fee, ask for an explanation.
- If you end up paying an unexpected fee, call the company and see if they will waive the charge.
- Fees for things you believed were covered by the baseline price of a product or service
- Unexpected fees for a product or service
- Fees that seemed too high for the purported service
- Fees where it was unclear why you were charged
Watch more on ABC10 | Dollars and Sense: Aging on a Budget
