If you are tired of walking long distances and dealing with traffic to get to your best shopping mall, you must be considering online shopping. After all, online shopping saves you a lot of time and money. So why are some people still going for offline shopping while online shopping is saving them a lot of time and money? The main reason is that there are all kinds of hidden costs. In this brief, we are going to guide you along hidden costs of buying online and eventually tip you on how to stay away from hidden costs.
Why is Internet shopping growing massively?
Internet shopping is growing massively because most people are today opting for it because of all the benefits that accrue in the long run. The industry is growing fast also because of the free deliveries and free returns. It is also very possible today to get uncountable coupons and other discount codes which can save you a lot of money as you shop for your favorite item.
With all those enticing things, you may wonder how these online retails are making money. One thing that most people don’t remember is that there’s a reason behind every marketing strategy. This means most of these companies will make sure they attracts as many customers as possible and at the same time hide some costs which translates to their profits.
What are hidden costs?
Hidden costs are unexpected costs that accrue on the process of buying goods and services online. They usually accrue when you are buying a house, a car or many other items online. It can as well be defined as miscellaneous fees that add to the final bill when you are booking travels. The reality of the matter is that hidden costs can add up to really hurt your wallet.
Examples of hidden costs
There are many examples of hidden costs. They differ depending on what you are purchasing.
Annual Credit card fees
Many shoppers are today going for credit cards because they think its a better way to make some extra cash back on your daily purchases. With a credit card, it’s always imperative to take note and be aware of overspending.
The reality of the matter is that the credit card balances can quickly accumulate and at the same time increase interest costs. The other disadvantage is annual fees. Annual fees can be anywhere between few dollars to hundreds of dollars.
When you are booking your accommodation especially when travelling to different parts of the world, or even when you are enjoying yourself in a hotel with your friends and family, you are likely to spend more than expected in terms of Taxes and resort fees. These fees are actually hidden costs of booking a vacation.
Resort fees unlike taxes are negotiable and for this reason can be sometimes be waved. To get the best deals, you have to research and communicate well with your resort management.
Buying a home
This is the biggest investment that you will make in your lifetime. For this reason, it means you should be careful with the costs that may unexpectedly accrue along the way. In this case, hidden costs include inspection fees, closing costs and application fees.
How to identify and avoid hidden costs
Depending on what you are purchasing, it’s very imperious to research the type of hidden costs that you may incur. After that, you should know what you should do to avoid these costs.
Do enough research
The good news is that there are many competitors in the market. To get control of a bigger market share, some of them are waving many costs. For this reason, you should always make sure you have done enough research before you continue.
This comes into play when you are purchasing a house or a car. Your ability to negotiate with the seller will help you miss some hidden costs including application fees and closing costs.
Work with a trusted agent/company
Regardless of what you are buying, you should make sure you are working with a trusted agent or website. If you are buying a house, make sure you are working with a trusted and a seasoned realtor. When you are thinking of a mortgage, please acquire that through a reliable source because this will alleviate a lot of anxiety that is especially associated with hidden costs.
Do a little math
Before you finalize the purchase or before you sign up for a reward credit card, you should take time to do math to determine whether the annual fees will be less than the rewards you get. If the answer is yes, then you should dis that credit card and shop normally. You can as well look for options because there are many competitors without the extra costs.
Be wary of interest rates
When you are going for a reward credit card, it’s up to you to make sure interest rates favors you. In such cases, it’s always a nice idea to pay the balances in full to avoid paying extra costs.
Communicate with the relevant authorities before you book
This is a helpful tip of avoiding extra costs when booking a vacation. It’s always a nice thing to call the support desk before you book and inquire about the resort fees. In some cases, these fees can be removed especially if the tenant will not be using the services. It’s also very imperative to look at the hotels loyalty program because there are no extra costs and you will as well end up getting free Wi-Fi which can save you up to $20.
Helpful take away
You should stay away from hidden costs at all costs. They might seem as minor costs but they will drain your pockets with no time. If you do the above to avoid hidden costs, you will end up saving a lot of money in the long run. The above are just examples of how you can avoid such costs, but the important take away is to be wary of hidden costs whenever you are finalizing any kind of purchases.