How the U.S. Postal Service Slowdown Could Cost You Money

The only way around spending more than you need to is to plan ahead.

When major Trump donor Louis DeJoy was named postmaster general in 2020, many were alarmed. After all, the U.S. Postal Service (USPS) has historically been a reliable way for people to receive their prescription medications, send gifts to loved ones, and make sure their bill payments were delivered on time. For the first time in more than 20 years, someone with no postal experience has taken the reins, directly impacting the lives of millions of people.

DeJoy's latest move? Slowing the time it takes for mail to reach its destination. DeJoy calls the plan "Delivering for America." According to DeJoy, the USPS will now be run more as a business and -- though it's not clear how -- become more competitive.

So, when you pop that card in the mail for a friend's birthday or mail your mortgage payment, there's a greater chance it won't arrive on time. Thanks to Delivering for America, about 30% of all first-class mail will simply take longer. While mail sent within a local area will still be delivered in around two days, you can count on mail sent from farther away to take longer.

According to the Postal Service, you should count on deliveries taking up to five days instead of two or three. That's because the USPS has decided it can save money by packing mail onto trucks for cross-country delivery rather than using air transportation.

Unless you plan ahead, Delivery for America might cost you a lot.

What it means for mailed checks

An estimated 7% of workers do not have their paychecks directly deposited into their bank accounts. That number is not exceptionally high, but if you like to feel a real check in your hands and prefer to mail checks to your bank for deposit, you may want to change your way of doing business.

Let's say you're paid on Friday each week and mail the check to your financial institution on Saturday morning. Until now, you could reasonably expect a deposit to your bank account in two or three business days, or on Tuesday or Wednesday. Now, depending on how far you live from your bank, it could take until Thursday or Friday for the check to arrive.

The simple solution is to sign up for direct deposit if your employer offers the service. If not, pay your bills as though the deposit will not be made until late the following week. That way, there will be less chance of using an account with insufficient funds. Given that a recent Forbes survey found that the average overdraft fee for one check is $24.38, depending on the post office to get your check to the bank on time could be an expensive miscalculation. Imagine that you write five checks to creditors each payday. If all five checks were to bounce, you'd be facing overdraft fees in the vicinity of $120.

If you decide not to enroll in direct deposit, consider using your smartphone to make deposits from home. It's as simple as downloading your financial institution's banking app and following a few easy steps.

What it means for mail coming your way

Just as some of your mail will take longer than usual to reach its destination, so too will mail coming to you. That means you may wait longer than usual for bills to arrive. But even if a bill takes longer to reach your mailbox, your creditors will not extend the due date. Let's say you usually receive a utility bill on the 15th, and it's due by the 24th. If that same bill arrives on the 17th, it will still be due on the 24th.

If you don't already have a monthly budget in place, consider setting one up. A budget helps keep you on track financially, allows you to make sure you have enough money to cover your expenses, and reminds you when each bill is due to help prevent late payments.

In any case, if you're still receiving bills via the USPS, now is the time to sign up for electronic bill delivery. As long as you have internet access, you can still open your bills to examine the charges. You also have the option of paying most monthly bills automatically by having the payments taken out of your bank account on the day they're due. Doing so ensures you won't face late fees.

Package delivery is likely to slow considerably

During the first quarter of 2021, around 20% of all first-class mail arrived late, according to Postal Service Chief Technology Officer Scott Bombaugh. And for the 160 million homes and businesses that depend on the USPS, things will slow down even more. There will be no more running to the post office to mail a gift midweek and expecting it to arrive by Saturday.

If you are one of the 15 million Americans who own a small business and depend on the Postal Service to deliver mail to your customers, your way of doing business will need to change.

For starters, you can no longer promise a customer they will receive their package within a few days. And because customer service is vital to the growth of your business, you may have to discover new ways to create goodwill. For example, you might include a small gift in each package, like a calendar, bookmark, or other add-on. Or you could include a personalized note to let the buyer know you appreciate their business. It's unlikely that mega-businesses like Amazon and Walmart will suffer since they can pay for alternative delivery methods. What you lack in speed, you'll need to make up for in personalized service.

In short, factor in longer delivery times when you make promises to customers. It could very well involve finding ways to make buyers glad they found you -- even if it took longer for their package to arrive.

What's more, Delivering for America will also reduce post office hours, raise the price of postage, and introduce even greater postage hikes during the holidays. So do what you can now to prepare your schedule -- and your wallet -- for these changes.