8 "Free" Things That Aren't


Free has to be one of the most abused words in the English language. It's become so bad that we are always skeptical, and look for asterisks or legal copy to see what the catch is. But, even when there doesn't appear to be one, free is not always what it's cracked up to be.

Here are eight instances when something free may end up costing you in the long run. (See also: 20 Ways to Entertain Your Kids for Free)

1. Free Shipping

As an occasional eBay seller, I know the power of free shipping. In fact, one of the most popular ways to sort products on eBay is to click the box that says "free shipping."

When researching this, I discovered that it was better to charge $19.95 for a product and offer free shipping than it was to charge $14.95 and $3.95 shipping. As you can see, the latter is actually the better deal — but people don't see it that way. So the next time you are looking at deals online, do some comparison shopping — especially on eBay. You will find that on many occasions, identical products work out cheaper when you actually opt to pay separate shipping.

2. Free Checking

Many banks will lure you in with free checking, but don't sign on the dotted line until you really understand what's being offered. For instance, my "free" business checking account comes with a $15 monthly service charge if I don't pay at least three bills each month using the bill-pay service. That one was news to me.

You can also find a whole host of fees that you will have to pay to handle your money, ranging from wire transfer fees and checkbook costs to ATM fees, minimum balance fees, and others. Oh, and the second you go into the red, expect to be hit with a whopping fee (usually around $35), even if it was only by a few bucks for a few hours.

3. Free Big Prizes

We're not talking about winning a couple of tickets to a show or an mp3 player. If you are lucky enough to win something big, like a home, fancy vacation, or a car, be prepared for the cost implications that will follow. The big problem being taxes.

For instance, many people on the show Extreme Home Makeover were thrilled to see their old home become an extravagant mansion. But once the cameras had gone, they were left with massive property taxes, big energy bills, and steep insurance hikes. Their financial circumstances didn't change to cover those costs, and they either had to sell, take out a home equity loan, or in some cases, declare bankruptcy. If you win a big car, or dream vacation, you will have to declare this to the IRS. So, be careful before saying yes to anything like this. It may be a dream come true, but can you afford it?

4. Free Pets

You see them advertised on Craigslist, local ads, and even in the break room at work. Someone's pet has a litter, and they want the kittens or puppies gone quickly. Hey, a free puppy, that's great! Well... yes and no.

Your new addition will need a lifetime of food, care, and veterinary visits. Right off the bat, you'll have to pay to have your "free" pet vaccinated and spayed or neutered. If you choose a puppy that will grow into a large breed, you can expect to pay hundreds each month for food. And if your pet gets sick, the vet bills can be insanely expensive. If you want to avoid that, pet insurance is another hefty monthly cost. The big question is, do you have the financial stability to accept a free pet?

5. Free Hotel Breakfasts

"Hey look, it says here we get a complimentary breakfast every morning!" Actually, you've already paid for it. No hotel would stay in business by giving away tens of thousands of dollars in food and beverages every single day.

The simple fact is, the cost of that breakfast is incorporated into the price of your hotel room. For example, instead of charging you $135 per night, the hotel charges $150 per night and includes "free" breakfast. Of course, if you're smart and book the hotel with a price comparison website like Hotels.com, you may get the room for way less than the advertised price. In that case, the other guests are paying for your free breakfast.

6. Free Meals/Tickets for Listening to a Pitch

You know the saying, "There's no such thing as a free lunch?" Well, sometimes it's spot on. In this instance, you're asked to listen to a sales pitch in exchange for a free meal, tickets to a show, or even a free vacation. Sounds like a good deal, but it isn't.

It turns out you have to spend at least 45 minutes of your time listening to a pitch about timeshares, or investment opportunities, or new baby products (yes, this happened to me once). And once the presentation is over, you will be given the hard sell — the super hard sell. These people don't like to give away free meals or show tickets without converting enough people into customers to make it worth their while. So ask yourself, is your time free? Because you are paying for your "free" gifts with it.

7. Free Extra Gadget — Just Pay Shipping and Handling

You can already see the conflict in that statement. Many times on TV you will see those very sales-y infomercial products. After being blasted for 90 seconds about all the amazing things it can do, you are suddenly surprised with the fact that the order will be doubled if you call now. And, very quickly, a voice says, "Just pay shipping and handling."

Well, guess what. You're actually paying for that extra gadget. In fact, the whole pricing model is based on the cost of selling two items to you, not just one. The additional shipping and handling fee is a nice little bonus on top, as the cost of shipping was already calculated in the original cost of the product. It's all smoke and mirrors, but it's a very effective way to get people to buy. And, if you want to test the theory, call and ask to buy just one of the product at half the cost. You won't get very far.

8. Free Stuff on Craigslist

Many people I know like to browse through the "free" section on Craigslist in the hope of snagging a real bargain. Most of the time, what's being offered are items that are either too difficult or too costly for the owners to dispose of themselves.

From time to time, you will find something decent on there. But before you say yes, remember it's not actually free. You have to go and pick up the item, which means you're spending money on fuel, putting miles on your car, and of course, using your own time (which is valuable). You may also need to repair the item in question. A good example I saw recently was a movie projector. Offered free, because it needed a new bulb that cost almost $100. So, do your research, ask questions, and see if the free item is actually worth your time and money.

What free things have you picked up only to regret the actual cost later?

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Guest's picture

I remember reading about a guy who won a lifetime supply of donuts and the IRS taxed him on the "retail amount" of what that prize would cost in real dollars. It was thousands of dollars and he was not too happy! The "Listen to the Pitch" and win free stuff is big with Hawaii and Mexico hotel vacations too. A tortuous block of time often two to four hours followed by a hard sell approach that's awful. Was not my idea and I'll never be subjected to one again! Talk about rabid salespeople!

Guest's picture

When our sons were teens, the "free breakfast" definitely paid for itself. Of course we checked out all the options first. An extra $10 over the regular room price was cheaper than food on the road. Now we can go without.