It is not even midmonth and you may be wondering why your pay cheque is unlikely to go much further. You may be splurging or catching up with debts from past months. Another reason could be that your running expenses are increasing.
Running payments such as insurance, memberships and subscriptions may have gone up and you have missed a notification or never received one. How? Many service providers change their rates periodically, and based on your contract you may or may not receive a notification of the increase.
Slight changes may be overlooked on your bank statement. Was it Dh349 or Dh399? It may be hard to recall what rate you agreed on a year ago. But these changes could add up to an unmanageable increase in your expenses. And even if you’re not facing a financial crisis before of an increase of several hundred dirhams per month, it may be wise to consider shopping around for better rates.
Here are a few points to keep in mind when you’re looking into your rates of services, memberships, etc.
Introductory rates
Many service providers offer special rates to attract new customers. These rates may be clearly set for a particular period of time, like three, six or 12 months, or could be subject to change at any time. If you’re agreeing to a new service, you must check for how long your rate is guaranteed, and whether you will be able to break the contract and get out of paying a higher rate later or not.
If your rate is set for a particular period, then it increases at the auto renewal date, add a reminder to yourself. Shop around before the end of your contract to see if you could get a similar attractive rate from another provider or you could have it extended.
Value for money
Now that you have used a particular service or service provider, you may be able to decide whether your rate was fair or not. Cheaper isn’t always better. If your service provider, say an insurance provider, has come through for you, and you have been pleased with the service, the customer service and support, a slightly higher rate could justify the increase in fees or charge.
Before you switch to a new service provider, think of what you’re going to lose if you don’t receive a similar service. In some cases, it doesn’t really matter, and you should take the savings. In other cases, better service may mean savings in time and effort, which eventually save you money.
Added services
Watch out for service providers who add new features and services to your account without your knowledge or who somehow trick you to agree to additional services. For example, if an internet provider asked you if you would like to increase your speed without explaining that would double your monthly bill, you might just focus on the upgrade and miss the price tag attached to it.
Even worse, if you’re paying for services and features that you’re not aware of, you probably are not using then. That is why you should always inquire to see why your fees have increased and what you’re paying for.
Payment frequency and accuracy
Companies are not perfect. You must keep your records for what you’re paying and how much. If you’ve subscribed to auto-pay, ensure that you’re not charged more than what you agreed on, and also not more often.
Errors do happen and unless you bring them to the provider’s attention, you may go on paying more than you should for a very long time, before they get caught — and hopefully corrected — by the provider.
In short, keep track of your ongoing payments, and note any changes in the amount or features. When a change does happen, review the entire situation and take the time to shop around for better rates and service, if you’re not happy with your current one.
The writer, a former Gulf News Business Features Editor, is a Seattle-based editor.
What is that payment?
Review your regular payments
Check for frequency and accuracy
Shop periodically to find better rates
Read the fine print regarding introductory rates
— R.O.
