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Why fewer junk fees won't necessarily mean more money in your pocket

If you've ever bought a concert ticket, then you've dealt with junk fees, which add to the cost but don't necessarily add much value to the product.

CALIFORNIA, USA — Junk fees are the surprise charges that inflate the prices of hotels, concert tickets and more, without actually adding much value to the products themselves.

With the summer travel and concert season here, sticker shock can add up fast.

Odds are if you've made certain types of purchases online, you've probably dealt with junk fees. They're the hidden and unexplained charges paid on the order, and it's a growing concern for consumers.

"Generally speaking, customers don't like hidden fees. People would rather just be presented with one price, and they can decide whether or not that's fair. They don't like the surprise, 'Gotcha!' at the end of the transaction," said Ted Rossman, with Bankrate.com.

The government is working with some major companies to try and lower these fees and give people more transparency when shopping. 

"Just recently, the White House held an event with some of the large ticketing agencies, companies like Live Nation, Ticketmaster, SeatGeek. There's been an agreement among those companies to be more transparent in their fee structure," said Rossman.

He said some types of fees, like sporting tickets and home rentals, have become more transparent, but other purchases like airline seats or hotel resort fees have not. 

However, one big question is whether less junk fees will mean more money in your wallet. 

Rossman said companies might lower junk fees but they could also raise prices in other ways to make up the difference. 

"I don't think people will really see savings from this," he said. "I do think they'll see more transparency. So that is a win for comparison shoppers that you'll have a better idea of what you're getting into, but I don't think prices will come down."

As far as avoiding junk fees, experts say people should read the fine print for anything bought online or when signing up for a new service or financial account.

If you didn't understand the reason for a fee, ask for an explanation, and if you end up paying an unexpected fee, call the company and see if they will waive the charge.

Executives from other big corporations like SeatGeek and Airbnb have been meeting with the president to further the campaign to fight junk fees.

That being said, junk fees are big business. Live Nation said concert attendance was up 24% compared to pre-pandemic numbers from 2019. Meanwhile, the average price of a U.S. concert ticket came in just over $100. The company plans to roll out the all-in pricing experience in September.

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