Friday, October 26, 2007

Always Read The Fine Print

ALWAYS. A-L-W-A-Y-S. All the time, no excuses, no matter what.

Now, do I take my own advice? Yes and no. I admit to skipping past the terms and conditions of privacy policies when it comes to creating an online profile on a website. But if the item in question is at all related to my financial life, I will take the time to read the fine print. These are situations where it’s especially important to do so:

Contracts for cell phone service, home repairs, computer warranties—anytime you pay for something that includes a contract, you should read it before you sign. This is where your rights and responsibilities are spelled out as well as the rights and responsibilities of the company you’re doing business with. Make no mistake: those rights and responsibilities are ALWAYS in THEIR favor, not yours, so make sure you’re covering yourself by being aware. You can learn valuable things like:
  • Your cell phone company requires you to pay for their service for x number of years, and if you cancel before then you must pay x amount in an early termination fee (there is currently legislation underway that would require that fee to be pro-rated! Cross your fingers!).
  • Your cell phone contract also spells out the difference between regular SMS messages (which are included in a text messaging plan or for which each provider charges around $0.15) and premium messages, which are billed by a third party and not your provider (like voting for American Idol or getting a ringtone or joke sent to your phone). These charges are usually around $0.99 but some of them also sign you up for a weekly or monthly subscription service with little or no warning (but I guarantee you that there is fine print wherever you saw the short code to text to, be it an ad on TV or in a magazine). Knowing this difference would have really helped this guy.
  • Contracts for appliances and services like refrigerators, contractors, or the like spell out exactly the terms of the deal: how much you’re required to pay up front, delivery charges if applicable, when the work should be finished, etc. You need to read this up front so you know a) when things are supposed to be done, b) what remedy you have if they’re not, and c) what your responsibilities are. I’m not a homeowner and have not dealt with any of these contracts yet, but I will be reading every word of them and asking questions if necessary when it comes time.
Of course, there are lots of other situations where you would encounter a contract. READ IT before you sign. Ask questions about things you’re unclear on. If there’s something that doesn’t suit you, ask if you can change it (your success with this will vary). If the salesperson hassles you about taking the time to read the contract, do not do business with them. It’s a legal document which details your rights AND your responsibilities, and any company that wants uninformed customers is not one you want to give your money to.

Sweepstakes, Rebates and Promotions
Fine print abounds in this material, and it’s important to read and understand it to increase your chances of winning or getting your reward. You might discover you’re not eligible because of your age (most states require entrants to be at least 18 years of age) or your location (some states don’t allow certain types of sweepstakes). You might discover you need to do something to be qualified, like write an essay, fill out a form, or have your paperwork postmarked by a certain date. If you don’t take the time to read the fine print, all of it, you might spend your time and possibly money on something that ends up being worthless.

I recently got an email from my new bank, saying that if I signed up with their online billpay and used it for three new bills during the month of October, I’d get $50 deposited to my account. I know they’re good for it; I initially switched to this bank because they had a $100 promotion for opening a new checking account (the fine print: I have to keep the account open for at least six months, it’s for new customers only, the $100 is taxable income). However, I didn’t read all the fine print for this online billpay promotion, and as a result I’m not getting the $50. I’m not losing out on any money, but I did take the time to set up the online billpay and go through their system instead of going online to each vendor and paying them directly as I’ve always done. I don’t know whether I’ll continue to use the billpay feature (which would make it less of a waste of time) or go back to the way I used to do it, but the fact remains that it’s not something I would have done had there not been an offer on the table. My failure to read the fine print wasted my time.

You already know that the paper you sign when you rent a car has lots of important information on it, like whether you have unlimited mileage and how much it’s going to cost you if you return the car with less than a full tank of gas. But did you know that there’s fine print available when you buy an airline ticket? In addition to agreeing not to dress provocatively on some airlines, you’re given a few rights as well—while a Passenger Bill of Rights is still in the future, all airlines have a Rule 420 which details the circumstances under which they’re required to compensate you for delayed or cancelled flights and how.

I managed to successfully get a voucher from Northwest after they stranded me, nearly made me miss my sister’s wedding, and then tried to blame it on the weather—when the reason our flight was pushed back was because the plane was leaking oil. Clearly spelled out in their Rule 420 is that if the delay is caused by malfunction or maintenance issues of the plane, they are required to provide accommodation and meal vouchers for passengers stranded overnight, as I was. I took a voucher over direct reimbursement, since the value of the voucher was larger than what I’d paid out of pocket, though it probably wound up being the same cost to them.

Health care
Actually, most of the print in health care situations isn’t all that fine—it’s just so boring no one wants to bother with it. However, it’s important to be familiar enough with your health insurance to understand the premiums that you’re paying out of every check, the copays you’re responsible for when you go to the doctor, the difference in cost for brand name versus generic prescriptions, and limits like maximum out of pocket expenses or annual plan benefits.

Other situations
Fine print shows up on the bottom of your receipt, detailing return policies. You see it on websites, encouraging you to seek qualified legal, financial, or other professional advice instead of relying on the internet. It appears on sale tags in stores (sales are final, must buy two to get one free), products (cape does not enable user to fly), and commercials (professional driver, closed course. Do not attempt.) Fine print covers peoples’ asses, gives them instructions, and in some cases, details their rights. Ignore it at your own (financial and legal) peril.

1 comment:

  1. I just went through a fine print issue with my phone bill last week. Evidently our phone company assigned us our personal toll free number and started attaching a monthly fee. It was approximately $2.75 a month, which is still $2.75 a month and for a service I didn't ask for or didn't need. It was small print kind of buried in the phone bill. That sort of action by companies is so annoying. Your so right, we need to read the fine print ... even the small amounts like my little toll free number thing add up over the course of a service. Good Post!


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