Postage Rates May Be Increasing Again

[jeffrey]

While gas prices have most likely affected your budget, they have also done the same to many businesses. For the post office, every penny increase in gas prices costs about $8 million taken away from their bottom line and this has post office officials signaling that an additional postage increase will be needed in 2007.

There is already a 2 cent per stamp increase that is scheduled for 2006 which will raise first class stamp prices to $0.39, but this increase had nothing to do with operating cost increases. The 2006 stamp increase will be to cover the cost of escrow payments of $3.1 billion which is legally required of the post office. The escrow requirement will also likely increase in future years leading to more stamp increases unless the current requirement is changed by Congress.




Due to increased gas prices and other operating costs, the post office is predicting a $1.8 billion dollar loss in 2006 even with the $0.02 postage stamp increase.

There are steps that can be taken to help decrease the use of the postal system. Email and electronic greeting cards can be sent in place of letters and regular greeting cards. Many financial institutions offer automatic bill paying services that make it so there is no need to write a check and send the bill through snail mail.

For those that have to purchase stamps, it is possible to purchase stamps at below their face value in certain circumstances and you can save money by using the coins in your change jar to avoid exchanging fees to purchase stamps.