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Fed Up With Fees

Does it feel like some companies are picking your pocket? Guess what? They are.

Charging for services that used to be free is now "good business." Need to speak with a United or American Airlines agent to book your flight by phone? That'll be $25, please. And if you call your doctor for after-hours advice, you could be charged up to $25.

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Illustration of man holding a cell phone while a ghost hand reaches into his wallet to take cash

Illustration by Zohar Lazar

More companies are charging for services that used to be free.

Welcome to the new America — the land of the fee — where businesses eagerly lift their recession-depleted incomes by lowering yours. "There's been a large uptick in fees recently, especially as corporations try to maintain or increase profits," says Randy Allen, a former retail-industry executive and a current associate dean at the Samuel Curtis Johnson Graduate School of Management at Cornell University.

These fees aren't just a fad, adds finance columnist Evelyn Kanter, who recently learned of a $14.95 fee to pay her Macy's bill by phone with a credit card. "It's follow the leader," she explains. "If one company gets away with a fee, others figure they can, too." The evidence: Some high-end hotels now charge up to $25 to receive packages for guests, and others are charging more than $10 for housekeeping service. Plus, paper statements now cost up to $3 from some utility companies, phone companies, and banks.

Dollar bills blowing-how to avoid outrageous hidden costs

Photo by Paul Taylor/Corbis

To fight the fees, complain to a manager. If they are not responsive, take your business elsewhere.

These charges might be laughable if they weren't so obnoxious. Richard Laermer, who tracks consumer trends in 2011: Trendspotting for the Next Decade, once paid $2 for a piece of tape at a shipping center. "And when I asked to test cologne at an upscale men's store, I was told, 'That will be $2 a spritz,' " he recalls.

So how can you avoid what Laermer calls "corporate pillage and plunder"? Take your business elsewhere, when practical. And take time to complain to a manager or company president when you can. For instance, after consumers railed against Bank of America's plans to charge a $5 monthly fee for debit card use, the bank abandoned its plans in November. That said, some add-ons may be unavoidable now that charging for basic service is becoming the norm. Speaking of service, remember that $25 United Airlines fee? The president and CEO of United Continental Holdings Inc., Jeff Smisek, earned about $4.4 million annually at last count. We'll let you ponder that.

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