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Does America Hate Money?

by J. Money on Wednesday, January 25, 2012

hair dryer gun to head

That was the subject line of an email a reader just sent in ;)  At 3:30 a.m.  Haha… I think he was bit perturbed. Here’s the rest of the email below:

I just opened my hotel bill today and I was shocked to see all the added taxes that were added on my bill.  Now I was a little upset at that.  Not because of paying more money, but I felt that I was being deceived.  What ever happened to: “It costs $5″ “okay” *passes $5* “have a great day!”

Nowadays, it is no longer airlines who are not adding random fees on top.  In a way of promoting their product above the others, it seems that the “price” is just an arbitrary number for a variety of different industries (especially the mortgage industry).  Then they add shipping & handling, sales tax, dog tax, breathing tax, and come out with a final cost.

I’d really like to see if people have noticed the same thing I do.  Are we so ashamed of seeing cost, that we often let the seller dictate what its worth?  Is anyone else willing to provide stories/examples of this?

I’d really like to hear from people who are about to sign a mortgage, and see a bunch of “admin fees” tacked on.  Thanks for listening to my 3:30am rant.

And here was my response (not at 3:30 am):

Haha, nice.  And so true – there’s taxes all over the dang place.  I mean, I guess most of it helps us in the long run, but I agree it would be nice to know UPFRONT what, exactly, the cost is for the stuff we buy.  Would make life a lot more interesting.  And in fact, maybe it would make people NOT buy as many things too!  Which would be great for us, but not so much the economy… so maybe that’s why the complete costs are hidden? ;)

What do you guys think?  Are you tired of getting nickeled and dimed all over the place, or have you come to terms with the way it is?  Our good friend above is dying to know!

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(Photo by xJason.Rogersx)


{ 29 comments… read them below or add one }

1 David Damron January 25, 2012 at 7:32 am

I am not so much against higher costs and taxes as much as the “hidden” part.

When I lived in Aussie, they include the taxes and “all additional costs” in the actually price tag. It was awesome walking into a store and the tag on a 12 pack, I mean healthy smoothie, saying $5.20, going to the register and paying $5.20 and not $5.87 or whatever. Way easier for budgeting too.

I look at it this way….Let’s say I want to budget $200 for a weekend road trip. The hotel says $99 online. So you budget $100 for hotel. Perfect! That leaves $100 for gas and food. Then you get your hotel bill and it says $127. Your hotel budget has just gone up by 27%!!!! However, if you knew prior it would be 27% higher we could be SMARTER about how we approach how we spend our money and whether we could adjust for such…aka budget.

Anyways…just my thoughts…

D

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2 Elle January 25, 2012 at 7:56 am

I hate seeing hidden fees and charges added on. I signed up and buy things because I felt like the value I’m getting (which includes the price) was a good deal. Adding things on is frustrating. I also don’t appreciate my cable company (TWC) not itemizing their bills anymore. I have to call to see what service increased.

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3 MoneySmartGuides January 25, 2012 at 8:11 am

Everyone complains about income taxes, but think of all of the other taxes you pay: sales tax, gas tax, taxes on your cell phone, hotel taxes, airline taxes, taxes on your cable bill. They are everywhere. If we were to add up how much we pay in taxes in all of these other places, we would be shocked as to how much we truly pay in tax.

It seems like the politicians lower our income taxes, but then throw in added taxes in other areas to net everything out. I’d rather pay the tax on my income instead of getting ‘nickel and dimed’ everywhere and on everything.

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4 Alexa January 25, 2012 at 8:51 am

We went to Hawaii in November and stayed at a really nice resort…and I guess that means really nice “hidden fees” too!!! We arrived at the hotel at 10pm and they charged us $15 for parking that day!!! You have got to be kidding me! And if you want to use the wifi you would have had to pay $12 a day for it! (Thank goodness for smart phones). And if you wanted to use their computers to get on the web it was going to cost you $2.75 for 5 minutes! I didn’t even look to see how much it was going to print something. But they gave you a coupon to print off your boarding passes for free. Sometimes you just swallow it and go on your way but this hotel seemed to go overboard on the extra charges for the internet that really don’t cost them that much.

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5 Money Beagle January 25, 2012 at 8:53 am

I do hate all the hidden fees and surcharges that so many industries think is their right to impose on you. Cell phone companies, airlines and hotels seem to be the worst, but even cable companies, other utilities, and I’m sure a million other industries all try it as well. One day the grocery stores will probably start adding on a checkout fee every time you pay, in which case we’ll know we have gone off the deep end.

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6 Stephanie January 25, 2012 at 9:03 am

Ugh, I definitely hate the hidden fees. By the time we finally cancelled our land line, more than 40% of the total bill was taxes and fees. And the hotel tax thing really gets me. Hotel taxes are usually pretty high, and they substantially change the price of your stay. I really wish they’d just include them in the price they list on websites/brochures/etc. I’d much rather be able to budget accurately than be deceived into thinking I’m getting a great deal, only to have that illusion shattered. ;-)

I’d guess that this has something to do with the fact that so many people are seeking quantity, rather than quality. They want to get as much as they can for as low a price as possible, so when we comparison shop, there’s a tendency to use price as the sole criteria. I can see how this would spill over to the companies themselves, who feel like they need to compete on price alone, even if the price they’re putting out there turns out to be a bit deceptive.

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7 Weirdo January 25, 2012 at 9:33 am

I go into buying something with the notion that there will be tax? It’s not something I enjoy, but it necessary, I think. I mean if we don’t pay our taxes, who else is going to sit in Congress playing Solitaire?

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8 Tyler S. January 25, 2012 at 9:40 am

Catchy title, the answer is no.

All the random hidden fees that are tacked on to purchases whether it be hotels, airlines, car rental, WHATEVER, are so frustrating. We looked up some cruise options for a quick weekend getaway recently, and the prices were advertised at $179. I can only imagine the kinds of extra fees that will be added onto that, but if we do end up signing up for one, I will return and vent some more here!

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9 Jeremy Streich January 25, 2012 at 9:43 am

It’s balance I think. I would prefer to know “The item costs this” and “this is the tax on it.” Because if the tax wasn’t a separate line item, then people wouldn’t complain about the taxes as much and it would be easier for politicians to raise them. I propose that items price tags and adds have the breakdown of fees on them before you get to the register. At most stores in Wisconsin that would be:
Price: $2.00
Tax: $ .10
Total: $2.10

On a mortgage, that would mean seeing the numbers everytime the purchase price changed:

Loan Amount, Real cost of loan (minimum payments [principle and interest] for term of loan)
Principle and Interest:
PMI:
Escrow State Tax:
Escrow Home Owners Insurance:
Closing Costs
——————–
Title Cost:
Title Insurance:
Bank Fees:
Total Closing Cost:
Total Monthly Payment:
Total cost over life of the loan (estimate, as tax rates change):


Now, you only see all those numbers in any real form at the closing, after you’ve paid a non-refundable deposit.

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10 Rachael January 25, 2012 at 9:44 am

I’ve never been to the States but I imagine it must be really confusing to choose an item at the store with $x on it, and then get to the till and it actually costs a different amount! Here in the UK everything is included in the sale price, but we still have the problem of booking tickets/flights etc where the price structure is never clear.

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11 mints January 25, 2012 at 10:14 am

In Mexico all prices are final, taxes have to be included… so if it’s says it costs 100pesos, that’s what you have to pay. (Except airlines but now I see it’s a worldwide issue).
It really annoys me every time I go to the states (3 – 4 times a year) that I have to go around guessing how much I’ll end up paying…. and getting filled my pockets with pennies…ohh the damned pennies!!!

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12 Kristin January 25, 2012 at 10:34 am

I have made it a point to shop for plane tickets on websites that include the cost of the standard taxes and fees in the prices that they show you up front. Then I can compare apples to apples. I understand the point that airlines made, that they are the only ones being asked to do this, but the number of connections and the particular airport you fly into influence the extra amount, so it’s not a flat percentage or a flat number, so it’s not something the consumer can easily calculate.

I do wish that taxes were more fully disclosed. In MA, different municipalities have different meal taxes and there are alcohol taxes, the percentages of which are never listed. I’ve definitely gotten bills that list the line items, a food subtotal, an alcohol subtotal, the tax on the whole meal, and then the total. When I was a kid and knew what the state sales tax was in CT, I could just multiply the tax by a certain number and have the tip all set. But with the type of bill above, a locality I’m not familiar with, or splitting a bill between a bunch of people, you can have up ending to do a lot of math very quickly. In CO, two places I bought my textbooks from had different sales taxes rates on my receipt. Huh? They were across the street from each other, in the same town.

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13 Brian January 25, 2012 at 10:51 am

Well the email should feel better since there are new regulations that are coming (Starts Thursday) to airlines where they must disclose the total price (http://blogs.wsj.com/middleseat/2012/01/23/dot-forces-airlines-into-more-disclosure-of-fees-taxes-delays/). So there is that.

Would I like to not get nickled and dimed? Sure, but it is just the way we do things now as more and more localities add their fees to your total. For example, here in Indianapolis we have additional taxes on restaurant bills to cover the cost of the new stadium.

The good news with some fees, you don’t always have to pay them. For example there are fees added to your cell phone bill that you do not have to pay and if you look at the bill they tell you that they cannot force you to pay them.

Until enough people get fed up and write their local and national representatives most of these fees and taxes will continue.

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14 Jennifer Lissette January 25, 2012 at 11:05 am

@ Brian – I did not know that about the cell phone fees. Have you had success in not paying those fees and retaining cell service?

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15 Brent Pittman January 25, 2012 at 12:56 pm

Hotels will really ‘get you’ these days. We use online services like priceline to bid on hotels, but many of them require you to pay 10-20 a night for parking…whatever. Just look on Yelp and people tell you what streets nearby to park for free.

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16 retirebyforty January 25, 2012 at 1:06 pm

Here ya go. We are looking to refinance.
loan origination fee $795
loan buydown $338
appraisal fee $575
credit report fee $17
flood certification $12
title fee $1,147
settlement fee $250
gov recording fee $137
endorsement fee $150
reconveyance fee $120
gov service fee $25
30 days interest $850
property tax for 5 months $1500
HOA
insurance
etc….

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17 Corey @ Passive Income to Retire January 25, 2012 at 1:12 pm

I personally hate the idea of having to pay extra fees, but I also know that I wouldn’t buy certain things if I saw the whole price upfront and then the economy would suffer as a result. I guess, I will stick with the way things are and just learn to outsmart the advertising schemes and let everyone else get tricked so that the economy keeps going.

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18 Jayson January 25, 2012 at 1:26 pm

I was just going to post a house example but @retirebyforty hit it on the head. My example is a bit ridiculous too…

Took advantage of a Clean Energy refund opportunity offered by the city. Long story short it actually cost me a net $103 after permits and required utility upgrades to support (upgraded gas meter etc.). I was charged for two permits, one for the water heater installation and another for the plumbing and gas!?! I still don’t understand why it can’t be an hourly charge based on the amount of time the inspector is required to be on site like every other service job?

And don’t even get me started on the citizen fraud that are called “fees”. This is a way that cities and other entities can push through taxes without the majority vote of the constituents. I think my local cable bill has about 10 on there amounting to about $15 or so…I’d be interested to learn more from @Brian about how he was able to get out of paying some of those fees.

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19 Brad January 25, 2012 at 1:50 pm

From a marketing standpoint, you can understand this. For example, if I am a company that advertises nation wide (think taco bell or verizon) and say my product is $5 or $50, how am I supposed to differentiate what the cost will be with tax from one state to the next… or from one town to the next. Not to mention the perception of a lower amount draws you in.

That said, it sure would be nice to go to the grocery store and only pay what is on the price tag when I pick it up.

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20 Craig January 25, 2012 at 2:07 pm

So many businesses are having to charge such high taxes because they are paying high taxes themselves. If our country could get out of debt and the system could be reset, maybe we wouldn’t have to pay such high taxes.

Here is my “what would I do if I were you” response:

Try getting some type of discount to offset those taxes or asking for a lower rate? A lot of times, there is some discount out there that will offset the taxes. I don’t care how cheap it looks but if it saves ya an extra 10% on taxes? HELL YEAH!

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21 Cassie January 25, 2012 at 2:34 pm

Ooooooh man. I HATE this! Cell phone companies, utilitiy companies, hotels, buying a house, buying a car, just about everyone! I want to smuck them all upside the head! I like my money, which is why I don’t want to give it to them!

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22 Meg January 25, 2012 at 2:45 pm

Over here in Australia it’s illegal for a business to add undisclosed charges to a bill. Especially shops – they get fined if they charge more at the checkout than the price displayed on the shelf.

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23 Too Funny January 25, 2012 at 4:12 pm

The harder I work, the more I earn, and the more taxes I pay. Annoying.

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24 J. Money January 25, 2012 at 7:32 pm

@David Damron – I think your thoughts are right on the money bro – I’d LOVE it if everything was more straightforward like that. From the looks of some of these comments today, it seems many countries DO operate like that! Very interesting…
@Elle – Oh man, cable companies are the worst. I feel bad saying it, but it’s so true. ESP with customer service, bleh.
@MoneySmartGuides – That would actually be a good project! Tracking how much you pay in taxes & fees for like a whole month? You should do it! And then tell us all about it ;)
@Alexa – Well that blows. I’m def. cool with sucking it up every now and then, but it def. comes to a point whereit’s absurd for sure. At least sometimes they’re avoidable though (whereas others they’re tacked on no matter what).
@Money Beagle – HAH! That would be something ;)
@Stephanie – Yup, exactly. The odds are a lot higher that you’d spend $99 to buy something than $117 for example. And once you’re in the store or on that plane or wherever, you’re not changing your mind and going elsewhere – so they pretty much nab ya.
@Weirdo – Haha… so no more porn then?
@Tyler S. – Yes, do it! We should all start tracking how much taxes and fees we pay and see what happens ;)
@Jeremy Streich – Haha yup. Or you’re too lazy/frustrated to end the deal and then go start it all over again during the next 30-40 days ;) That’s the whole thing with it really – once you’re THERE, it’s much harder for you to turn something down cuz you’re so aggravated about it all. It works out really REALLY well for the sellers of these products.
@Rachael – Enjoy it!!! You’ll be quite surprised by the time you stay 24 hours here ;) (but you should for real visit anyways, you’ll love it!)
@mints – Haha… I like the pennies! You can make fun art projects with them ;)
@Kristin – Wowwww, that’s pretty crazy… I agree, the whole thing is rather frustrating :(
@Brian – Amen brother. We can complain all we want, but if we don’t act on DOING something about it we’ll just be a bunch of whiners ;) Great reminder, man.
@Jennifer Lissette – I’ve gotten 1 or 2 things off too, but on my cable bill instead of phone bill. Things that were automatically on there from the start – crazy.
@Brent Pittman – Yeah, Yelp helps sometimes with that. Though if it’s a city-city it’s def. hard to find spots still. That you at least know are safe ;)
@retirebyforty – Is that all? :)
@Corey @ Passive Income to Retire – Haha, whatever works.
@Jayson – Man, that blows – sorry to hear! At least you got some nice upgrades, yeah? :)
@Brad – Hmm… yeah, you do have a point there. Actually a pretty damn good one, it’s hard for me to debate thta! Haha…
@Craig – Yeah for sure. Esp if you have AAA and other kinds of memberships – it’s amazing the discounts you can get sometimes just by asking. Even though you feel like a turd sometimes.
@Cassie – Well you can keep your money instead, you just won’t get any of those sexy products ;) haha…
@Meg – Woahhhh, that would be something! Even more reason to come visit there one day! :)
@Too Funny – You’ll be paying more too if a certain politic party has its way ;)

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25 Earn Save Live January 26, 2012 at 4:17 am

I’m an American, living in Australia. It’s a law here that every price (whether it’s for milk or a plane ticket) must include all taxes and fees. Honestly, I love knowing exactly how much everything is, and I’ve found that it helps me to stick to my budget.

In the news today, the government is fining an airline for not fully disclosing all fees in the final price. “The ACCC requires businesses that advertise a part of the price of a product or service to also specify a single total price which must be prominently shown in the advertisement.” Article: http://au.ibtimes.com/articles/287131/20120125/accc-seeks-injunction-against-air-asia-over.htm

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26 Jen @ Master the Art of Saving January 26, 2012 at 6:22 pm

I hate the hidden fees. I’d probably spend a lot less money if I knew everything up front. :-)

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27 J. Money January 26, 2012 at 7:17 pm

@Earn Save Live – I bet that’s nice indeed. Enjoy it while you’re over there! :)
@Jen @ Master the Art of Saving – I’d like to think I would too, but I’d probably still give in ;)

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28 Bob January 27, 2012 at 12:55 am

Hotels are the worst and it makes forward planning much easier in countries like the UK where it’s a what you see is what you get price.

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29 J. Money January 27, 2012 at 1:27 pm

The only hard part there is doing the conversion to see how much it truly costs w/ American dollars ;)

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