If it seems like you’re always out of money at the end of the month, you may be a victim of a deceptive billing practice. Sit down with a calculator and your credit card statements to find out where the leak is occurring and fix it before you get into trouble. Read on to discover 5 deceptive billing practices everyone falls for at least once.
The free-to-paid scam is one of the oldest in the industry. Companies offer you something for free and then demand payment for future deliveries. In today’s age of credit cards, these scams can be packaged as “free trial” offers or other such incentives.
Avoid them by not signing up for something free that requires credit card information or by using a pre-paid card with zero balance for all of your free-trials. Avoiding free trials can save you anywhere from $5 to $50 a month or more.
2. Unwanted subscriptions
A relatively new tactic being used is the unwanted subscriptions. These are usually add-ons that are automatically checked at the bottom of an online order. Be sure to read all of the fine-print before placing an order, even with a trusted company, and uncheck those pesky boxes. Unchecking the box can save you anywhere from $10 to $25 a year or more.
3. Negative options
This is a trick where the retailer sends you a sample included for free with your order. In the fine print it says that if you do not cancel the subscription for the sample, you will be charged a monthly fee with recurring shipments. To avoid this, always call the customer service department if your package contains something you didn’t expect.
Depending on the product, you can save anywhere from $5 to $50 a month or more.
4. Unwanted auto renewals
Sometimes when you sign up for a service or a magazine, you’ll be automatically signed up for auto renewal unless you specifically ask not to be. Then, after the service period expires, which may be as much as a year later, you are automatically charged the full price for another membership or subscription.
Sometimes, you can’t cancel after you see the charge and some particularly deceptive companies won’t even erase your credit card information. Two of the worst offenders for this trick are Angie’s List and Go To Meeting. Depending on the renewal, you can save anywhere from $50 to $300 a year or more.
5. Zombie subscriptions
If you cancel a subscription and it keeps popping up on your credit card as if nothing ever happened, you have what is called a zombie subscription. These unwanted friends keep springing back from the dead after numerous phone calls and other efforts. If you suffer from a zombie subscription, change your credit card information online if possible to a pre-paid card with zero balance that’s not tied to your social security number.
Even better would be to delete it, but most zombie subscriptions don’t allow for this option. Depending on the subscription, you can save up to $100 a year or more.
Keeping your eye out for deceptive billing practices will help you keep valuable cash in your pocket. Be weary of which companies you do business with and when signing up for any type of subscription or trial, use a pre-paid card whenever possible. That way, even if the company wants to forcibly keep your business, they won’t get any money from you. Always watch out for sneaky billing practices and pocket the savings.