I was listening to a local sports radio station last week and got a surprising dose of personal finance.
One of the hosts was talking about how he worked out a some gym and then decided to cancel his and his wife’s memberships. He called a customer service number and asked to cancel. He was told the memberships would be canceled, so he felt good about the extra money in his pocket.
The he didn’t look closely at his bank statements for seven months.
SEVEN MONTHS!
Maybe it’s just because I’m a personal finance nerd, but I can’t imagine going seven months without doing an in depth look at my accounts. I personally check every single transaction monthly when I update my net worth for my Race to $1 Million with The Hoff.
When he did finally check his statements, he found that the charge was still being applied. He paid for both his and his wife’s memberships for seven months without even realizing it!
Obviously he called again and asked them to cancel the membership once more. He didn’t ask to be refunded for the seven months of charges because he felt like he was partly responsible for not watching his accounts more closely, but he did want to make sure that they closed the accounts. At least he learned to check his statements every month.
Or did he?
The next time he took a close look at his statements was 11 months later. Seriously guy… figure it out.
As I’m sure you can guess, he was still being charged. When he thought he had settled the matter once and for all, they actually only closed his membership and kept his wife’s active. At this point, he had been improperly charged for 18 months of one membership and 7 months of another.
Now he was pissed, so he fought for a refund of all the bad charges. They would only offer six months. At this point he took his battle to twitter where he started telling his story and naming the company in his tweets.
Being a radio host, he has thousands of followers. Bad twitter press sucks. Bad twitter press from a quasi-celebrity with a large follow is apparently unacceptable. Someone from the gym company soon reached out to him and offered him a full refund for all 18 months.
While I agree that he has a right to a refund, I also think this guy is an idiot. If he wasn’t a “celebrity”, he never would have gotten his money back. Profitable companies aren’t in the business of writing big refund checks to people who are obviously never going to use their service again. And 99% of consumers aren’t in the business of taking a huge corporation to civil court over a few hundred dollars.
If you don’t check your statements, you could be getting charged an old membership fee for some gym that you never used. Or maybe someone has your account information and is using it to buy their daily latte. Or maybe you are being hit with some kind of ridiculous bank fee every month that you never knew existed.
Don’t be an oblivious consumer and then get pissed that you were unintentionally paying for something for 18 months. And don’t rely on some automated service to do it for you either. No automated service in the world would have caught that old gym membership.
I highly recommend that you at least do a quick review of every single transaction at least once a month. It will make sure you’re only spending your money on things you actually should be paying for.
Kevin McKee is an entrepreneur, IT guru, and personal finance leader. In addition to his writing, Kevin is the head of IT at Buildingstars, Co-Founder of Padmission, and organizer of Laravel STL. He is also the creator of www.contributetoopensource.com. When he’s not working, Kevin enjoys podcasting about movies and spending time with his wife and four children.
Pretty much every day I turn my laptop on, I log into our credit card and bank websites and reconcile every transaction into my spreadsheet. If I go more than three days without having accessed either, I start to get really edgy.
I know lots of people who do that. I can’t obsess over it. Not enough time in the day. I only log on once a month to check everything, but when I do, I review every single transaction.
Wow! Especially with all the little hidden fees here and there. When I looked last month, I realized I got hit with an international transaction fee for an ATM withdraw that didn’t even work! What the what?!?
Yeah, one time I noticed a charge from Italy. I had rented a car in Italy and they tried to run my card again about 3 months later. I disputed the charge and had it removed. I never understood why they wouldn’t flag an international transaction as suspicious and alert me.
Since I have all my bank accounts linked to Mint.com, I find that I don’t check my actual bank statements as often as I should. However, I do check mint.com almost every day, and have generally noticed when I’m still getting charges something that I shouldn’t be.
Mint pulls in individual transactions, so you would see it there if it were hitting your account. I think you’re good.
I check my bank statements everyday. *blush* You just never know I feel and it’s important to double check on all of those things. I have had to go back to stores and demand refunds for overpayments or double charges, all mistakes on their part. If I wasn’t on top of that, I would have been out some of my hard earned cash.
Wow, that sucks. I check my stuff, but hardly ever find anything wrong. Maybe I’m missing things. I’m not good about checking grocery receipts or anything like that.
Yes.
I check my bank statements once a week just to make sure that the right charges are suppose to be on there
You right Kevin.it happens to me that I don’t look at my account for a long time but it definitely necessary. it easy to forget and not to think about it but it’s dangerous as we can see. thank you for recommend me and remind me 🙂
I feel silly for admitting this, but I ran into this problem a few times when I was in school. I had accounts with two separate banks: One for my day-to-day expenses, and one for rent and tuition. The latter one, I really only checked in once a month to transfer money from the savings to the chequing to pay my rent. A couple of times, my bank would randomly start charging my fees, forgetting that I was a student, and I wouldn’t notice for a couple of months and then would have to fight hard to get the fees back. Who randomly becomes NOT a student in February? As much as that was my fault, I still left the bank eventually.
“As much as that was my fault”
How exactly? I agree that we must be vigilant about companies ripping us off, but I’ll be damned if I’m going to accept any blame for when they do.
To some extent, Kevin is placing some of the blame on the consumer as well. Take this passage:
“Profitable companies aren’t in the business of writing big refund checks to people who are obviously never going to use their service again. And 99% of consumers aren’t in the business of taking a huge corporation to civil court over a few hundred dollars.”
While not explicitly absolving blame from the corporation, he doesn’t say anything about their ethical obligation. I think this just rubs me the wrong way because I recently read the “Coupon Sharing is Stealing!” article, and I start to get the idea which side of the “corporation v. consumer” Kevin leans toward.
The guy certainly should have had a better idea of where his money was going. I don’t disagree with any of the facts Kevin lays out. Here is some more truth, though: the gym stole money from this guy, they did so repeatedly, and they did not rectify the problem when he informed them of it. This is completely and unquestionably unethical business behavior. He is absolutely entitled to a full refund at the very least.
In the Gap situation, the store clerk gave him back the coupon with full knowledge that he could give it to someone else. Yet Kevin sides with the store!
I didn’t mention the company’s ethical obligation to their consumer because I’m not in the business of complaining. Whether the company has an ethical obligation to the consumer doesn’t change the fact that the consumer has to take care of himself.
While I would never say a company has a right to steal from a customer, I’m not going to waste much time thinking about it. My site is focused on consumer actions, not company actions. If you want to complain about a bunch of companies, The Consumerist is a better place than Thousandaire.
I would leave that bank too. My time is very valuable to me, and if a company is going to make me waste time fixing a problem, I’m not going to stick with them very long.
Yeah, that was the thing. I had to actually go into the branch every time and fight the fees. And there weren’t a lot of branches. And they all closed at four. What student has time for that?
I switched to TD a year ago and never looked back! <3
I check my bank and credit card online almost everyday. It’s not that difficult. I wonder if most people are like this radio guy and doesn’t really look as long as they can pay.
I have heard horrible stories about how hard it can be to cancel a gym membership. It’s definitely necessary to follow-up on it EVERY month! This is the main reason I don’t like automatic payments.