Forever Stamp – Why It Will Cost You Money


forever stampThe forever stamp has been getting quite a bit of press lately as it will likely become a reality come May. While the stamp itself will help to save people time (by not having to go to the post office to get small denomination stamps to make the current stamps they have meet new postal increases) and may even save people a bit of money who mail a lot of first class letters, what many people are missing is that it will likely mean higher postal costs overall in the coming years.

That’s because the reason that the post office has been pushing the forever stamp is that it plans to raise postage rates on a regular basis – likely every year. When the post office wanted to raise rates in the past, the needed to go through the Postal Rate Commission that was often skeptical of the rate increases the post office asked for and was charged to make sure the increases only covered the postal services’ costs. Just the public hearings on the issue of a postal rate increase would take nearly a year, then more time would pass before any of the changes could be implemented. This meant that postal increases could only be made once every several years.

What many people don’t realize is that the Postal Rate Commission no longer exists. As part of a new law President Bush signed, it is now called the Postal Regulatory Commission and it’s no longer in charge of hearing rate requests. Instead of hearings, first-class stamps will now be tied to the inflation rate through the Consumer Price Index with the price being able to be adjusted once a year. That means we will likely see yearly increases in stamp prices from now on.

The other issue is that the forever stamp will not always be the same price. While the forever stamp can always be used to send a first class letter one it is purchased, when rate increases occur in the future, the forever stamp will also increase in price to the same level as the first class stamp.

While the forever stamp will likely be convenient when sending letters, the overall concept is not one to help you save money, but to make the future and more frequent postal increases less of a hassle.


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March 20th, 2007
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Comment Number:
1
Written by:
LAMoneyGuy
Posted on:
March 20, 2007 at 11:05 am

I probably send a couple of pieces of mail per year for personal purposes. Much more for business, of course. I suppose, I should load up on stamps for our wedding invites now, while we can.

Comment Number:
2
Written by:
shraz
Posted on:
March 20, 2007 at 12:40 pm

Stamps are still relatively cheap. I don’t like the idea of an increase every year but every 3-4 years, I don’t mind. They should just increase it to 50c and keep it for 10 years.

Comment Number:
3
Written by:
Bob
Posted on:
March 20, 2007 at 3:09 pm

Has there been any word on the legality of secondary markets for the ‘Forever Stamp’? Will we be able to buy and sell them on eBay? If they are going to increase the price anually, it might not be a bad investment.

Comment Number:
4
Written by:
Pauline
Posted on:
March 20, 2007 at 8:25 pm

We’ve just moved to the forever type stamp in Canada. It comes with a warning that the program may not actually last forever, but this may just be to prevent hoarding.

Comment Number:
5
Written by:
Rog
Posted on:
March 20, 2007 at 11:13 pm

What a crazy idea! Based on the number of letters my Wife and I mail every year, the cost of buying enough “Forever Stamps” would be around $700.00 assuming that we continued to pay our bills and send approximately the same number of letters and cards for say the next 15 years at least! What kind of stamp will peel off it’s slick,wax paper and then adhere to any envelope after 8,9 or 12 years of storage, much less 14 or 15 years (or perhaps, hopefully longer)? I have personally found some old two and three cent stamps that I attempted to use the last time the postal service raised it’s rates and had to cut them out of their placement on the backing with sizzors and glue them onto the envelope with “Elmers Glue All” and these stamps were less than 4 years old! How does one safely store approximately 1,667 “Forever Stamps” until they are finally used up? I could go on but whats the use? Once again someone has come up with yet another great idea to suck millions of “Front End” dollars into a system that already knows that the idea is doomed to failure and also knows that in a short period of time the majority of postal patrons will be back in line purchasing stamps at the going rate!

Comment Number:
6
Written by:
Nate
Posted on:
March 21, 2007 at 11:32 am

I got the same idea as Bob as I read the story. Are having investments in forever stamps going to beat out savings accounts? I would think that a constant increase in stamp prices will drop demand for them.

When demand drops, the Post Office will recieve less money and have to make budget cuts or raise the cost of stamps. They will raise the cost of stamps, which will make these great investments.

Comment Number:
7
Written by:
Mark
Posted on:
May 10, 2007 at 8:08 am

Hey, this is great. I’m traveling to the future tomorrow and this will save me lots of money!

Comment Number:
8
Written by:
edgar d. hopson
Posted on:
August 28, 2009 at 8:12 pm

what was the price of the first forever postal stamp