- Posted August 28, 2014 by
New York study reveals hidden profit behind hotel fees
A new study by New York University professor Bjorn Hanson finds that hotels will bill their customers an incredible $2.25 billion in surcharges and fees in 2014. This record breaking increase is due to hotels charging their customers for an expansive list of services, many of which the guests don’t need or even use.
Many of these fees make profits of up to 90 percent for the hotels that charge them. Some of the fees include early departure fees, early check in fees, mini-bar restocking fees. Whether you have used the service or not, you are still charged for it.
Increasingly, over the last few years, many industries have been adding fees to their services. The most prominent example are the airlines which have added fees to everything from checked baggage to inflight food and drink. Airlines are so notorious for adding fees that Southwest Airlines ran commercials mocking the airline industry for it.
In addition to the fees charged by the airlines, other industries have gotten on to the profit bandwagon by adding charges for services that a customer might use. ATM card users are charged a fee when using an ATM, another fee if they are withdrawing cash and another fee if they overdraft their card. This is on top of the regular fees for maintenance.
According to MSN, the worst offender in the fee market are the retirement account fees. Even with the disclosure rules that went into effect in 2012, most people don’t understand how much or why they pay fees on their 401k plans. Many don’t even know how much they pay. Users don’t realize that they are even paying fees on their 401ks because the fees are drawn from their accounts automatically. Although the fees for a 401k account don’t seem like much, 1.46 percent was the average in 2012, according to the Society for Human Resource Management, they shouldn’t be higher than 1 percent.
Now that the economy is slowly recovering, many people who could not afford vacations and traveling over the last few years are easing back into it. With surcharges and fees reaching an all-time high on hotels, airlines and ATMs, many of these would-be vacationers will find that there dollar doesn’t stretch very far anymore.