A Factory Working, College Grad Getting Out of Debt

Reality Check – Grey Charges

The other day while I was investigating my credit cards and the interest charges they have (what?  Don’t you just throw away those silly little brochures of fine print too?) I saw a couple of interesting charges on one of my credit cards.  The Credit Card company calls them Payment Protector and ID Protection.  I call them expensive.  When I first opened this card as a freshman in college I played it straight.  I looked through my credit card offers, went for the cheapest interest rate and best company.  I researched a little bit.  I thought I was ahead of the game.

And then when I received that neat little piece of plastic in the mail, I knew I had an emergency fund in my hand in case my car broke down or if something happened at college while I was away from my parents and need a quick bit of cash.  I hated the college party scene so my card never was used for things like that, but soon it was being used to help pay for some furniture or tires that I desperately needed.  It was a convenient way of paying for the gasoline that I needed in my tank without having to go to the bank every week (because I was already getting a notice in the mail that if I withdrew too many times in a month I would be charged).

I did not expect that within the first three months that I would get some additional mail from the Credit Card company.  No siree.. when they sent me that envelope explaining that the Payment Protection plan was in my benefit to insure that if anything went wrong from the direct payment from my bank account to them, the payment would be secured and applied without charges.  When they told me that it would only be a small percentage of what was on my credit balance, I thought nothing of it.  Of course I wanted to make sure my money was received.  And besides, my credit limit was nothing then.  When they offered me an ID Protection plan, I jumped on that too.  For a low fee of $7.99 a month, my ID would be protected in the chance that my identity would ever be stolen.

Well my credit limit went up, and with it my credit balance as I went through my college career.  So you can imagine my Payment Protection Fee did as well.  My ID Protection plan came in handy once when I lost my wallet shovelling my father’s walk and I had to have new cards and ID issued.  Although thank goodness it was only in a big snow drift that had piled up between my father’s house and my neighbors’ home, that’s not the point.  My neighbors did ended up finding it when the snow melted and even took the care to dry the contents for me.  I wish all neighbors were that nice and that good of people that you can count on them.

Anyway…  The Payment Protection Plan and ID Protector Plan?  I already told you about what can happen when you sign up for an auto-shipment. Yeah, those are what some people call greycharges. The inbetween black and white that you normally see on your statement. It’s a sneaky little thing that companies hope that you buy from them.  They upsell you the idea that your Identity could be stolen or your Bank could be faulty in sending the money to them… They prey on the niggling fear that is in the back of your mind and know that they can get you easily.  They got me of course; the freshman in college who was trying to prove that she was fiscally responsible while working two jobs and taking as many credit hours as possible to make ends meet.  They might have gotten you too.

Be wary of them.  Go have a look and see if you have some of these charges coming up on your statements.

They aren’t just necessarily from the credit card companies either.  That’s just one type of grey charge.  In fact, auto-shipments, cost creeping (where a cost for a subscription or service increases over time), foreign transaction fees, wrongful billing charges, etc.. They happen all the time.  Companies love the fact that you and I live a busy lifestyle.  They love the fact that you and I don’t read those fine printed brochures that come in the mail or are on those car rental contracts, etc… You might find that a subscription that you only paid a year’s worth for helps itself to continue billing you after that 12 month mark, or instead send two of the same titled magazine and bill you twice for it (happened to my mother not long back..).  The way that these charges come up can be sneaky too.  You might be being fooled by a company that tailors their description to match almost perfectly to something else that you pay for on a monthly basis.

So how do you stop it?

That’s simple.  Read your billing statements from your credit cards or Paypal accounts. Make sure that you did indeed incur the charge.  If in the case that it’s a Payment Protection plan, and you feel that you don’t need it, then cancel it.  I did.  If you end up having to call the company itself to cancel an auto-shipment that you can’t seem to cancel on their website, take that extra ten minutes and do so.  It might not be convenient, but it will end up saving you money.

I have to admit that I did keep the ID Protection plan.  Because I needed it once, and it worked like a charm, I decided to keep it.  I know it works, and I feel more secure by having it.  But the Payment Protector?  No thank you.  That’s a $25 fee that I can cut out of my budget and never have to worry about again, because honestly, it was just causing my interest on the credit card to go up every month.

Count those raindrops!

DecMeadow.

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