While the cost of living remains a massive concern amongst consumers across every demographic, one expense that continues to only increase exponentially is the cost of supplementary fees.
In a study conducted by Qualtrics on behalf of Credit Karma surveying more than 1,000 U.S. adults, 56 percent of Americans said that “high prices of fees, including service fees and processing fees,” have made them hold off on attending events like sports and live concerts.
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This trend known as a “fee creep,” is defined by Credit Karma as the rise in the number of fees that are tied to certain activities like concerts, movies, dining out and more. This trend has now started to convert into a lack of trust among consumers.
Eighty percent of consumers said they’ve observed a “somewhat-to-significant” rise in fees that are now pricing them out attending events and live entertainment. Not only is it ticketing companies — notably, Ticketmaster’s recent price hikes for Taylor Swift concerts led to Congressional hearings — but now restaurants, hotels, movie theaters, theme parks and rental cars have also started to engage in “fee creeps”.
While 72 percent of people are willing to spend money on additional fees, very few (6 percent) are willing to pay more than $50. More than half of the survey respondents reported that they’d be willing to spend up to $30 on event fees.
Despite this increase in fees, Generation Z (90 percent) and Millennials (85 percent) are the most willing to spend money on additional fees, as compared to 33 percent of Generation X and 45 percent of Baby Boomers unwilling to pay for fees.
The report’s authors suggest that Gen Z and Millennials accepting paying the higher priced additional fees is most likely because the generations feel pressured to attend live events and experiences. A third of Gen Z and 31 percent of Millennials reported that they feel pressure to spend money that they don’t have on live events and experiences because of social media.
Furthermore, a third of Gen Z and 31 percent of Millennials said they would spend any amount to attend these events. As a result, Gen Z and Millennials are taking drastic measures such as cutting back on dining, borrowing money from their savings, taking on credit card debt and sacrificing food or other necessities to participate.
“Over the last few years, we’ve seen a rise in prices for most things and, while the sticker shock has worn off for many people, others are digging into increased prices and noticing significant increases in fees,” said Courtney Alev, consumer financial advocate at Credit Karma. “Consumers have started to notice an uptick in the number and size of fees associated with their transactions, which is eating into their budgets and making it difficult for them to enjoy the same level of activity as they’re used to.”
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