Look Out for (Hidden) Credit Card Surcharges

As if things weren’t bad enough with the average consumer having to diligently watch where every penny goes during these lean economic times, some retailers have began engaging in a questionable practice resulting in a slow nickel-and-diming of consumer’s bank and credit card accounts. As a result of the antitrust settlement reached earlier this year between credit card issuing banks and major retailers (discussed on an earlier posting: “The Higher Cost of Banking…and How To Avoid It”),some retailers have already started to instituting “checkout fees,” surcharges of $1 or $2 on purchases made with either debit or credit cards.

Retailers use these fees as a means of attempting to recoup processing fees levied in turn on them by the card issuing banks. Before the settlement, major card issuing banks such as Visa and Mastercard prohibited retailers from charging such fees. The sad part of this policy is that we shouldn’t expect it to go anywhere, anytime soon. In fact, it’s probably a safe bet—barring a major consumer revolt—that more and more retailers will start charging these fees in order to offset the costs they incur processing credit and debit card payments.
Bill Hardekopf, CEO of LowCards.com offers some times for beating these surcharges at the register:

* ASK ABOUT ANY CREDIT/DEBIT CARD SURCHARGES BEFORE THE TRANSACTION.

* RETAILERS MUST DISCLOSE ANY SURCHARGES BEFORE THE TRANSACTION.

* IF THERE IS A SURCHARGE, DECLINE IT AND REQUEST ANOTHER METHOD OF PAYMENT. If necessary, cancel the transaction and shop somewhere else.

* REVIEW YOUR RECEIPT. Even if you end up using cash, a check or your debit card, review the receipt to make sure the store didn't levy a surcharge. There should never be a surcharge on a cash purchase.

Click on the graphic to view how surcharges appear on sale receipts.

In addition, Consumer Report’s website has an online guide warning credit card hunters shopping around for the best credit card deals about what to look for in order to avoid being nickled-and-dimed by credit card issuing banks.
You should know that there are 10 states which by law prohibit retailers from charging checkout fees.  They are:

California
Colorado
Connecticut
Florida
Kansas
Maine
Massachusetts
New York
Oklahoma
Texas

If you find that you are either being charged in one of these states, or being charged excessively (relatively speaking), Visa offers an online reporting site where you can submit your complaints.  Additionally, consumers who are subjected to checkout fees in states where they are protected by law may report the retailer to their state attorney general's office.
When it comes to spending money, the first rule of thumb is to remember the advice our mothers gave us; always check your receipts!

Groceries & Credit - Expect To Pay More Soon!

One of the problems with having a mortal existence is that, in spite of the ever-constant grind to secure our material needs, many things are simply beyond our control. Two of these things are market forces and the weather. And when these two forces combine, we are often left stranded on the intersection of supply and demand, and market expectations. The result is usually a choice of us consumers having to deal with less of what we want/need, or having to pay more. In two particular cases from last week, consumers can soon expect to pay more due to instances of things being beyond our control.
Late last week, the major credit card and many of the nation's retailer reached a record settlement in a long-running lawsuit that alleged the card issuers conspired to fix the fees that stores pay to accept credit cards. Visa, MasterCard and banks agreed to pay retailers at least $6 billion in a 10-year case that alleged the card issuers conspired to fix the fees that stores pay to accept credit cards.
Called by lawyers involved in the case the "largest antitrust settlement in U.S. history," the settlement is seen as a major victory for merchants that have long complained about the billions of dollars in so-called "swipe" or "interchange" fees that they pay to banks for purchases made using plastic. But at a time when shoppers increasingly are using credit and debit cards, merchants will face a dilemma: Whether to charge shoppers extra for using plastic, and if so, how to do so without angering them.
As part of the settlement, announced last Friday, retailers will be allowed to charge customers more if they pay using a credit card, just as many gas stations do currently. The upshot...expect to pay more every time you swipe your credit and debit cards.
The winners in this Big Money settlement: the major credit card issuing banks and retailers! The losers...you and I as consumers. The advice here is to avoid being nickeled-and-dimed by banks for using debit and credit cards, and use cash whenever possible



Late last week, the National Climatic Data Center announced that 55% of the country “was in a moderate to extreme drought” ending for the month of June; no improvement in this condition is predicted for the month of July. The immediate result is horribly-impaired yields and major plant damage to many water-dependent crops, including soybeans, corn, and wheat…the latter two being hit particularly hard. The intermediate result is the expected rise in prices we will all be feeling in the coming months. Current trends portent this impending reality.
As of this writing the price of corn is already up 38% in price, while wheat is up 29%, both due to the current drought. What’s more, there is a better than good chance that we will experience record beef prices in the near future because of the rising prices of feed, and the time it takes for shrinking beef yields to recover.
And with food-themed occasions such as Thanksgiving and Christmas in the not-too-distant future, expect to spend more about that time of year…and not just on gifts. The time to plan ahead is now.

For a detailed explanation of this year's drought effect on farm crops and food prices, watch the video: