Fees are monetary prices paid on services. There are different kinds of fees such as the contingency fee, lateness fee, service fee, bank fees, and even government fees. They come in forms of costs, commissions, charges or penalties. Some of these fees can be avoided while others cannot. For instance, fees in form of penalties may be avoided but charges incurred when a service is rendered cannot be avoided except the service is avoided altogether. Fees can add up fast if not checked, most especially bank fees. Some of these fees can be averted and the little money one would have used to pay these bills can be invested instead. Long term it can yield huge results and may make a difference between a rich and a poor.
UNNECESSARY FEES THAT CAN BE AVOIDED
While some fees such as the mortgage fee, government fees (such as taxes), school fees, some bank fees etc. cannot be avoided, it is best to check for others that can be avoided. Below is a list of fees that are most times unnecessary and can be avoided:
1. Late fee
A late fee is an extra amount of money that must be paid when payment deadlines are exceeded. It is also known as a ‘past due fee’. Late fees may be issued by the library when a borrowed book is not returned on time, by a landlord when the rent is long overdue, by an organization for coming late for a meeting, or by a financial institution when a loan is not paid on time. Late fees are set to encourage people to pay on time. It increases on a daily basis after the payment deadline is exceeded. To avoid these fees, as much as possible try to meet payment deadlines. To do that, you must consider debt repayment a top financial priority. These extra moneys that are paid on late charges can be invested in profiting ventures.
2. Hidden fees
Hidden fees are also known as undisclosed fees. They are not disclosed. These fees are the most annoying and creepiest types of fees one pay for services or for making purchases. They are most times written in fine prints. These fees may come in form of resort fee or safe warranty fees issued by hotels, prepaid card fees, or credit card charges. One way to avoid these hidden charges is by asking questions when possible and by carefully scrutinizing your monthly statements.
3. Dishonor fee
Dishonor fee is paid when a person attempts to pay for funds from an account with insufficient funds. For instance, if you have just $105 in your account and you issue a payment of $150 to be made from the account, you would be charged a dishonor fee. This fee in some cases is known as non-sufficient fund fee. To avoid this, one must try as much as possible to be sure of how much they have in their account before making any transaction. A dishonor fee may be as much as $35. It may seem small but as small as it is it can be invested.
4. Debit/credit card replacement fee
Carelessness may be a reason for paying more fees than you should normally. When you lose your debit/ credit card before the expiry date you’d have to request for a new one. A new debit / credit card is at a cost. Being organized and careful are ways of avoiding this unnecessary fee.
5. ATM fees
ATM fees are also fees that can be avoided. You can avoid them by using your bank’s ATM for making transactions or even by performing transactions online instead of using the ATM.
6. Service fees
While some service fees cannot be avoided, some can. Many bank charges can be avoided as well as other service charges paid when you engage the service of a company. For instance, you can do your tax filling and house cleaning yourself instead of asking companies to do them for you. That way you can have more money you can put into investments.
YOU COULD BE INVESTING THAT MONEY!
Some of these fees may seem small to you, but when they compound, they result in larger bills that could have been avoided. These large sums, instead of being wasted on unnecessary fees can be invested to generate higher income or higher outcomes. For instance, the money paid as unnecessary fees can be used to take on an online course to increase knowledge or invested in real estate. Some areas you can invest your money include:
- Stocks and bonds
- Knowledge investment (by taking on a course)
- Real estate and properties
- Cash investments e.g. fixed deposit
WHAT YOU STAND TO GAIN INVESTING THAT MONEY
When you invest those moneys you are ordinarily wasting on unnecessary fees there are many things you stand to gain. Some of them include:
- You’ll attain financial freedom early
Investment in other words is, making your money work for you. When you are working and your money is also working, that implies having multiple income streams. With multiple streams of income, your financial freedom would come faster than when you have only one stream of income. When you invest and have good returns you may even consider retiring early.
- You will be able to meet other financial goals
Some of your financial needs can be taken care of from your investment funds. Long-term goals like building a house or starting up an organization can be met with moneys got from investment.
- You can build wealth from investments
Investment is a habit of wealthy people. If you must build wealth then you must create an investment plan that suits the goal.
- Investing make your future more pleasant
When you invest money you should be rest assured that you’ll have more money to enjoy the future
Check those fees you are paying, some of them might just be unnecessary and can be avoided. Invest those moneys so you’ll get more money and attain financial freedom.
Investment decisions should be made wisely, in order not to incur losses.