New Postage Rates for 2014 — Stamp Price & Priority Mail Express Going Up

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The price of a stamp went up by 7% this Sunday, January 26th from 46 cents to 49 cents. Compared to typical standards enforced by the Postal Regulatory Commission, this is an enormous increase — all in the name of helping the USPS stay afloat as they face competition and economic challenges. And while the stamp price will have the most direct impact on consumers and businesses it isn’t the only the rate the Postal Service earmarked to hike this year. Surprisingly, some rates even went down.

Changes to Common Postage For Consumers: Forever Stamps, Postcards & Additional Ounces

While the price of a stamp for a 1-ounce letter went up by 3 cents, the changes are less observable in case of additional ounces and postcards, because the 2014 rates for each went up by only 1 cent. The change is 21 cents from 20 cents in case of additional ounces and 34 cents from 33 cents for postcards. This is not too much for a single mail piece, but multiplying the actual rate per additional ounces by ten (or any other value) will result in 10 cents (or more) paid in addition in 2014 by all consumers using USPS services. T

New Metered Mail Discount — One Way to Save

This year introduces a new loophole for the ordinary price of a stamp: by metering mail at home, a 1-ounce letter can be sent for 48 cents. This is a 1-cent saving now that the price has gone up.

Priority Mail — Nearly Unchanged; Deeper Discounts Online

Priority Mail's fancy new packaging -- without a price change

The 2014 Priority Mail rates will remain largely the same since the product was recently re-vamped in 2013 to include tracking, insurance and predictable delivery dates. Except from the Priority Mail Large Flat Rate Box and APO/FPO/DPO Large Flat Rate Boxes, which both increase by 0.60 cents, and 3-pound Priority Mail, which goes down in price by about 10 cents, all the other rates for 2014 Priority Mail Flat Rate stay the same and see no increase nor decrease compared to the last year.
Deeper discounts will come with printing postage online in 2014. Savings came to a maximum of 20% for folks printing Priority Mail postage from home and in 2014, savings will increase to up to 35%.

Many Changes to Priority Mail Express and Flat Rate Services

The Priority Mail Express rates are facing an average increase of three percent in 2014. These changes are spread across weight ranges and mailing distance, or “zones.” Even though the rates for 0.5 pounds stay the same, they are going up by 59 cents, 98 cents and 66 cents for one, two and three-pounds packages respectively for Zone 3 packages. The rates go up by 1.79 dollars for Zone 4 mailing, 1.98 dollars for Zone 5, 2.32 dollars for Zone 6, 2.15 dollars for Zone 7 and again 2.32 dollars for Zone 8 – all prices are applicable only for one-pound packages. The increases might not correspond very much –- for instance, the rate for 2-lbs packages in zone six is higher (1.49 dollars) compared to the rate for 3-lbs packages in the same zone (1.29 dollars) — so it may be worth looking over the USPS’s full breakdown.

Among Flat Rate Express services, the Flat Rate Boxes rate is the only one that suffered a change in 2014 compared to the previous year, going up by 5.00 dollars (from 39.95 dollars to 44.95 dollars). The other rates, Flat Rate Envelope, Legal Flat Rate Envelope and Padded Flat Rate Envelope, remain at 18.11 dollars in 2014, which is the same rate as in 2013.

Stamp Price Increase — Why the Change in Postage Prices?

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Wait! Didn’t the price of a first class stamp increase about, oh, five minutes ago? So why has the Postal Service announced yet another stamp cost increase?

If it seems postal rates increase every year, you’re right. On January 26th, the cost of a first class stamp went from 46 to 49 cents. This 3 cent rate hike in the price of a stamp is the Postal Service’s largest in more than a decade. Last year’s increase was by only 1 cent. It is now more expensive to mail a postcard as well, though that fee has only increased by a penny, to 34 cents.

Clearly, the mailing public didn’t make this decision. The Postal Service has been asking for a larger price hike for about three years now. Requests for these increases must go through the agency’s watchdog, the Postal Regulatory Commission (PRC). And the PRC is a tough overseer: they turned down the Postal Service’s 2010 request for an abnormal rate increase, claiming that they didn’t provide sufficient evidence of financial hardship. And the Postal Service was persistent — they then filed an appeal with the U.S. Court of Appeals, which agreed with the PRC and turned it down.

USPS Corner MailboxesFor this go round, the Postal Service presented evidence claiming that the agency had a loss of $22 billion between the years of 2008 and 2012. They also estimated a loss of $44 billion for the period between 2013 and 2014. The PRC uses a different calculation method than the Postal Service, however, and their grand profit loss total came in at just under $3 billion…

Therefore, they’re finally allowing the Postal Service to make only this amount in profits over the next eighteen months using higher than normal pricing. The Postal Service, which is hoping to keep this large rate hike permanent (the PRC says no, although this doesn’t mean postal rates will go down) is in the process of appealing the PRC’s decision to allow permanent increased rates.

So what did the PRC decide justified a stamp price increase at all? There are four main factors in their order granting the increase and they include losses suffered due to the economy, legal ramifications, the typical rate hike according to inflation and business risks around the USPS’s ability to operate.

Losses Due to the Great Recession and E-mail

The PRC agreed with the USPS that the recession was to blame for some profit losses in shipping, mailing letters, and doing business by mail; but they also blamed “electronic diversion” for much of the agency’s losses. This term refers to doing business over the Internet, e-mailing, etc. You should have seen this coming folks, and you didn’t, the PRC told the Postal Service. This reasoning plays a part in why the PRC thinks the Postal Service has lost much less money than they’re claiming.

The Stamp Price Increase Meets Legal Guidelines

Legally, the Postal Service’s rates are not permitted to rise at a greater rate than that of inflation and the PRC is required to enforce that. However, if the Postal Service can provide evidence of extreme financial hardship if capped by inflation, than this legal rule can be suspended (although this is somewhat debatable). The Postal Regulatory Commission says they have been provided with enough justification by the USPS to use this loophole. This is why they’re calling it an “exigent” rate hike.

Prices Can Go Up with Inflation Too

Despite all these mailing increases, the Postal Service actually hasn’t been keeping up with inflation over the years, so the decision issued by the PRC allows for an additional bump in price by 1.7%, just to keep up with inflation. This blends with the “exigent” part of the hike for a grand total of a roughly 7% increase.

USPS Services Were at Risk

In the PRC’s December decision, it was stated that the Postal Service “lacks a sufficient level of liquidity”(money) to provide services (like delivering packages and letters), and that the inflation-based rate alone will not be sufficient to finance operations. Because the USPS could show that their basic services were at risk, the PRC could justify a larger increase.

The PSRC will be reviewing this case to determine the fate of the exigent hike in May. In a strange twist in events, it’s possible that the price of a stamp will go down. Stay tuned…

Stamp Price Increase — Save on Postage by Buying Stamps This Week

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While I’m not one to dole out financial advice (and neither is this blog), there’s one investment you should probably make in the next 7 days unless you’d like to address all your bills, thank you notes and wedding invitations to Ripoffsville this year. The price of a stamp is about to skyrocket on Sunday, January 26th and your best way around it is to invest in some Forever stamps before the postage increase.

What do I mean by “skyrocket”? Ultimately, the price of a stamp is only going up by 3-cents… from 46 cents to 49 cents. Doesn’t seem like a big deal, right? Well, percentage-wise, this is a 7% stamp price increase! By buying Forever stamps, you’d save 6 percent! …You still don’t seem persuaded. I get it… It’s barely even as good as a Bed, Bath and Beyond coupon.

Buy postage stamps

Let’s look at it this way: historically, the price of a stamp has barely even kept pace with inflation — so, in a way, first class letter postage has actually gotten cheaper and cheaper each year. For instance, a 32 cent stamp in 1995, adjusted for inflation, would have been worth worth 49 cents in 2013. By comparison, this makes our actual 2013 rate, 46 cents, look like a bargain. And this historical pattern of inexpensive postage has persisted for quite a long time. In fact, something called the Postal Accountability and Enhancement Act of 2006 was supposed to force the USPS to raise stamp prices no faster than the rate of inflation. Forever stamps should never be a good deal, because legally speaking, stamp price increases should never exceed inflation.

Counter to all this, the USPS filed a request for an “exigent” price increase (by complaining about the Great Recession) and it was approved by the Postal Regulatory Commission. So, now the price of a stamp is actually bumping up to a full 49 cents — an increase of 6.5% — clearly higher than the rate of inflation. Inflation over the course of 2014 (which we can assume will be at least 1%) will remove the purchasing power of your postage budget as the year wears on. These economics will finally make this stamp price hike a bad one for consumers.

TL;DR: Buy some Forever stamps this weekend and thank me at the end of the year when you’re sending Christmas cards at a 6% discount. If not for the sake of beating the system, saving one more trip to post office hell will easily pay for many more stamps.

2014 Stamp Price — How Much is it Going Up? When’s the Change?

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If you’re following USPS news and the price of a stamp closely, you’d know that the first class rate for postage stamps is rising this year. But even the Postal Service is making it hard to answer the two most fundamental questions: By how much is the price of a stamp increasing? And when is this all happening?

The simplest answer is: 49 cents and January 26th, 2014. That’s not all — so read on.

The Stamp Price Increase

The new price for a first class stamp will be 49 cents. That’s a never-before-seen 6% increase to the old price which was only 46 cents. It might not seem like that much of a hike but for a rate that businesses depend on, it’s huge. If the USPS were following the convention typically enforced by the Postal Regulatory Commission, the price would only go up by 1 cent. The real change is 3 cents. So, relative to expectations, the new price is a 300% rate surprise!

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Forever stamps will increase in value when the price of a stamp changes this year.

Don’t forget that the USPS has already helped us deal with its constant price changes by selling Forever stamps. If you own Forever stamps (or buy them before the price changes!), their value will automatically rise with the price increase. However, if you go to the post office even just the day after the price increase to buy Forever stamps, you’ll pay the new price of a stamp: 49 cents.

When the Price Changes

The price of a stamp increases to 49 cents on Jan. 26th, 2014 according to the USPS, but what does that really mean? Jan. 26 is a Sunday — very few corner mailboxes are serviced on Sundays and nearly every single post office is closed. The postal service doesn’t even deliver mail on Sundays.

The USPS’s wording suggests that the new 49-cent price takes effect on January 26th, so we can assume that the actual change takes place at midnight or close-of-business on Saturday, Jan. 25th. In other words, if you drop something in the mail on or after Jan. 26th, you should plan to apply postage valued at the new price: 49 cents. Or, if you buy stamps at a kiosk or at a post office that’s open on Sunday, you’ll get charged the new price of a stamp.

However, we know from past price increases that the USPS permits a very unofficial “grace period” where it will continue to deliver mail stamped for the old postage price. If you’re lucky, this will last all day Sunday, Jan. 26th. On Monday, Jan. 27th, be sure that all of your mail has 49 cents of postage attached or it might be returned or discarded.

Stamp Price Increase in 2014 — Going Up at Unprecedented Rate

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On Christmas Eve, the Postal Regulatory Committee (PRC) officially approved an unprecedented increase to the price of a stamp — a full 3-cent increase — to take hold at the end of January 2014. This will bring the total price of a first class stamp to 49 cents from the current rate of 46 cents. The official change takes place on January 26th.

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Three cents may not seem like a lot but this is a 6 percent increase to the price of a stamp which is unprecedented.

The USPS is not ordinarily permitted to increase its prices beyond the rate of inflation. The ordinary price restrictions would have only raised prices by 1.7 percent — only enough to add one cent to the price of a stamp. Although a 3-cent increase sounds like nothing, the rate increase that the PRC approved comes to about 6 percent price hike which is unprecedented in USPS history… and an increase like that can have a real impact on businesses that depend on mailing letters.

The PRC made clear that this is a temporary increase to the price of a stamp and that it may only last 2 years although they did not outline a plan or guidelines for how the USPS will reverse the new rate. Instead they place the onus on the USPS to “report quarterly on revenues generated by the rate increases” and to come up with their own schedule to “phase out the rates once they have produced the revenue justified by their request.” Since the 1-cent portion of the price hike was in line with inflation, only 2 cents worth of the price increase will have to be rolled back.

The USPS has been suffering for a variety of reasons — from technology to inefficiencies in how it operates — however the regulatory committee that approved the USPS’s stamp price increase blamed the Great Recession for what they’ve been calling an “exigent” price hike. The agency believes that the financial harm caused to the USPS during the recession is an extenuating circumstance that justifies an extreme price increase.

Postage Rate Increase in 2014 — USPS Hopes to Hike Stamp Price by 3 Cents

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Today, the USPS announced a proposal requesting permission to increase the price of a stamp by 3 cents in January 2014. That would hike the price of a stamp from 46 cents to 49 cents. But don’t jump the gun and invest in forever stamps just yet — the rate increase might not get approved.

It’s no secret that the Postal Service is losing tons of money — some say up to $15 billion per year. The reasons behind these losses run the gamut: from truck fuel and retired employee healthcare to competition from email, social media and private mail services. This increase request is another attempt at raising revenue to help cover ballooning costs and impossible margins. According to the USPS, these new price changes will add $2 billion in revenue in 2014.

When the USPS wants to enforce a postage rate increase, it proposes them to the “Postal Regulatory Commission” or PRC. The commission is an independent government body which regulates how the Postal Service operates and it’s required by law to prevent the price of a stamp from increasing by more than the rate of inflation each year. This is what would makes this proposal so controversial: the dollar has only inflated about 1% in the past 12 months and isn’t expected to deviate much more than that by 2014. Unfortunately at 1% inflation, the USPS should only be allowed to increase the stamp postage rate by one cent. Instead, they’re asking for 3 cents. The last time this happened, this year in January, the USPS raised the stamp price to 46 cents from 45 cents… which was copacetic with inflation and approved by the commission.

3-Cent Postage Rate Increase in 2014

The USPS is hoping to increase stamp prices to 49 cents.

Mickey Barnett, the Chairman of the Postal Service Board of Governors, called this a “last resort” to help deal with the USPS’s financial challenges. They’ve made attempts at reforming the organization through legislation, including a threat to end Saturday delivery, which wasn’t successful. The Postal Regulatory Commission has the latitude to raise prices faster than inflation if circumstances are “extraordinary or exceptional,” and while the Post Office’s fiscal situation may suit that qualification, it hasn’t been a sufficient justification in the past. So, it seems unlikely that you’ll find the stamp price increasing by more than one cent in January. If your business depends on mailing letters, do count on a postage rate hike early next year (and stock up on forever stamps!) but it’s unlikely to outpace inflation.

The USPS hopes to enforce the new postage pricing on January 26th, 2014. The full proposal also includes a one-cent hike to the postcard rate, making it 34 cents; and a one-cent increase on additional weight for letters, making it 21 cents per ounce. They’ll submit the proposal to the PRC tomorrow.

Update 9/26/13: The USPS submitted their proposal today, as promised. The chair of the House Oversight & Government Reform Committee commented, pointing out that such a hike is a desperate measure and will push businesses away from using the USPS all together. Other blogs are posting about how buying forever stamps in advance of the increase could be a scheme for making quick cash.

USPS Improves Priority Mail Without Price Increase

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The USPS has improved its Priority Mail service without even raising the price of a stamp. If you use the post office frequently, you hardly expect improvements without a postage rate increase. There’s now faster, better Priority Mail service without a single penny added to the postage price.

What’s New with Priority Mail

There are many new features and benefits for Priority Mail including: new packaging, better tracking and free insurance. Also new to Priority Mail  is faster service — packages may arrive a day earlier. Before, Priority Mail could take two to three days. Now depending on from where and to where you are mailing, your Priority Mail could arrive overnight. In many cases Priority Mail service will now compete with the big overnight delivery companies like FedEx an UPS. And — you won’t be shocked by how much it costs!

Real Overnight Service without Price Hike

There is no postage rate increase for Priority Mail Service (yet!) even though packages could arrive as soon as overnight. While packages may arrive early, you won’t have a deliberate choice between overnight, two-day, or three-day delivery. This is always determined by the market you live in and you’ll get an estimate of the service speed when you purchase it. So if you are in a big city, chances are that you will get all the perks you are looking for with none of the punch to your pocketbook. The postage price for Priority Mail will remain flat, even though packages are expected to reach their destination sooner.

USPS Packaging, Tracking and Insurance Improved

The stylish new priority mail boxes.

The stylish new priority mail boxes.

The packaging at the Post Office has gotten an update, the tracking is better and there is now automatic insurance for all Priority Mail. For now, you can still use your old Priority Mail boxes but the new, stylish ones are already on the shelf at your local post office branch. In general, the tracking services for Priority Mail has also improved. New barcodes on the labels make finding your package easier and you will learn your expected delivery date as soon as you place your order. The free insurance depends on which payment method you use. You can get up to $50 of insurance for shipments sent at the Post Office or sent using Commercial Base Pricing. Businesses can get up to one hundred dollars worth of free insurance for shipments sent using Commercial Plus Pricing. (Commercial Base and Commercial Plus services depend on mailing volume.) You can always buy more insurance but this new feature will surely give you peace of mind.

Express Mail Changed to “Priority Mail Express”

The USPS has also rebranded Domestic Express Mail as Priority Mail Express. It’s still the same service but there is new packaging for this service as well. The USPS did a good deal of market research and found that the old packaging and service details were often confusing for customers. All of these changes were made in order to streamline the options for post office customers.With so many shipping services that compete with the USPS, making these changes seems like a smart move.

To stay competitive, it will be important for the USPS to continue to listen to its customers and to create valuable services in the future. Don’t be surprised if the prices go up, though. It is well known that the USPS is struggling and it will be a big win for their growth if people are satisfied with the changes. The best advice is to check out the new Priority Mail while the old pricing is still in effect.

First-Class Postage — What Exactly is First-Class Mail?

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First-class postage is a type of mail which indicates the level of service a package or letter is supposed to receive from a postal service. Most folks in the US think that all mail is sent first-class and that the label is a kind of misnomer. That’s because most consumer-facing mail is sent this way. (In the UK, there’s an actual distinction between classes of postage for consumers, so it’s different.) You’re about to find out what first-class mail really is.

First-Class Postage and Other Classes of Mail

First-class mail gets higher priority in terms of delivery time over other classes of mail. While the USPS doesn’t explicitly break other types of mail into classes, there’s a rough hierarchy which can be broken down in to four main classes of mail:

  • First-class mail — Letters, postcards or packages up to 13 ounces qualify as first-class mail. Put a postage stamp on a standard letter and you can send it anywhere in the United States for the price of a stamp.
  • Second-class mail — Officially known as the “Periodical” class of mail. The USPS reserves second-class mail for newspapers magazines and any other periodical that is published more than four times a year at regular times. Special categories of periodical mail (eduction, nonprofits) get lower postage prices.
  • Third-class mail — The USPS calls third-class mail “Standard Mail.” Its bulk pricing is designed for catalogs, newsletters, flyers and advertising.
  • Fourth-class mail — Also known as “Media Mail,” fourth-class mail is an inexpensive way to ship educational materials. Books, film, audio recordings and even loose notes are eligible but delivery times can span up to 8 days because of the low priority.

It’s obvious, but most consumers wouldn’t encounter anything but first-class postage since the other classes of mail are primarily for businesses or special needs.

First Class Postage Rates

Pricing for first-class mail varies quite a bit but you can calculate all sorts of mail prices with this handy postage calculator. Basically, the price of a stamp is standard (keep track of that here on the homepage!) and that covers most first-class mail — all letters under one ounce in weight. The only exception is a postcard which you can mail for 32 cents. Other letters range in price based on weight up to about $1.

Flats and boxes range in postage price from about $1 to up to about $4, depending on how many ounces the item weighs, as long as it’s less than 13 ounces overall. This is why it’s best to just use a calculator.

How Long Does It Take?

According to the USPS, first-class mail takes two to three days to arrive with its recipient. Unfortunately, there’s no guarantee around this — so you won’t get your money back if it doesn’t get there in time. But some first-class mail arrives in only one day.

The postal service only factors their transportation into their estimate so other variables like when your mail gets picked up aren’t a part of the equation. To eliminate that issue, it’s best to drop mail directly at the post office. Official mail boxes or your own mailbox can have sporadic pick-up times so it’s harder to get a reliable timeframe using those methods of drop-off.

Another variable that can impact first-class postage delivery times are days that the postal service doesn’t operate. Sundays aren’t a working day for the post office. The USPS also observes the long list of federal holidays, which can add to delivery time. Exceptions like severe weather and high-volume seasons like Christmas can also cause delays.

In the UK, first-class mail is an actual delivery time upgrade over second-class and it’s priced likewise. The Royal Mail delivers mail with first-class postage the day after it’s sent — though, like in the US, this isn’t guaranteed.

Overall, you can get a lot more detailed information about prices, regulations and dimensions on first-class mail from the USPS here and here.

Stamp Price Increase — How to Prepare for the New Price of a Stamp

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On January 27th, 2013, the US postal service will officially enact a brand new stamp price: 46 cents for a standard 1-ounce letter. A slew of other new postage increases are also a part of the change and they’re detailed here.

The same exact thing happened this week one year ago — a one-cent increase to the price of a stamp — so it’s pretty certain that every year around mid-January, you’ll have to scramble to take advantage of the imminent change. Make sure you’re not losing out because of the price change!

What You Need to Do Before the Price of a Stamps Goes Up

Stock up on forever stamps: Now’s your last chance to grab forever stamps for the lower price of 45 cents. Forever stamps are always valid for mailing a letter regardless of future postage increases — they’re always good for mailing a standard 1-ounce letter. However, because of the price adjustment, buying a single forever stamp will cost one cent more. A roll of 100 stamps next week will cost a dollar more. If the price of a stamp increases at the same rate, in a decade, that same roll could cost about $10 more. Buying stamps now, especially if you do a lot of mailing, will save some cash and hassle in the long run.

Use up your old stamps: If you still have official 45-cent stamps that aren’t labelled “forever” (most novelty, collectable or themed stamps aren’t forever stamps) you need to use them quickly! Send out your bills early or drop other letters you’ve been procrastinating on in the mail. Even though the price of a stamp officially changes on Sunday, since many corner mailboxes aren’t serviced on Sundays, there’s a short implicit “grace period.” If you can get your mail in the box on Monday, January 28th, it will probably reach its destination — just make sure you’ve listed a return address just in case. So, you’ve got time. If you have any leftover stamps on Monday, you’re still in luck. The USPS offers one-cent stamps which you can also add to the corner of a letter to bring your postage total up to the new 46-cent requirement.

History of the Price of a Stamp

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Generations before us, folks paid pennies to send a letter across the country. But times have changed and over the decades, the price of a stamp has ballooned from only a few cents to almost half a dollar. The table below charts the precise stamp price increases and the dates of their introductions. Using the table, you can get an idea of how the price of a stamp has changed over a timeline of over 100 years in the United States.

Before you see the table, you might like to understand the changes it demonstrates. Although it seems like the price of a stamp has risen at an alarming rate, this mostly has to do with inflation. Let’s find out why. The graph below depicts the price of a first class stamp in two different ways: the dark blue section shows the actual price of a stamp as it’s listed in this table against the year the price was in effect; the second shaded section in light blue shows the inflation adjusted price of a stamp using the value of US cents in 2008.

Stamp Price History

The price of a stamp over time compared to its inflation-adjusted price.

This inflation-adjusted graph proves that the price of a stamp has remained surprisingly stable over more than a century. This is because even though the cost of postage was increasing steadily, the value of the US dollar was inflating. That inflation means that the purchasing power of the cent was going down. With the purchasing power falling and the prices going up simultaneously, the net result is a stable stamp price.

Some of the sudden jumps up and down in the graph can just be explained by some of the the earliest stamp price changes. If you look at the table below you can see that since the stamp price was so low, an increase of just a cent means a relative increase of 50% or more. Were it reasonable to change the price of a stamp in increments of partial cents, there would be a less perceptible change in those areas of the graph. So, these changes had less to do with irrational inflation or pricing and more to do with relative changes in price.

Date of Price Change Price of a Stamp in Dollars
03/03/63 .06 (.03 per half ounce)
03/03/83 .04 (.02 per half ounce)
07/01/85 0.02
11/03/17 0.03
07/01/19 0.02
07/01/28 0.02
07/06/32 0.03
01/01/52 0.03
08/01/58 0.04
01/07/63 0.05
01/07/68 0.06
05/16/71 0.08
03/02/74 0.10
09/14/75 0.10
12/31/75 0.13
05/29/78 0.15
03/22/81 0.18
11/01/81 0.20
02/17/85 0.22
04/03/88 0.25
02/03/91 0.29
01/01/95 0.32
01/10/99 0.33
01/07/01 0.34
07/01/01 0.34
06/30/02 0.37
01/08/06 0.39
05/14/07 0.41
05/12/08 0.42
05/11/09 0.44
04/17/11 0.44
01/22/12 0.45
01/27/13 0.46

Here’s just one of many excellent resources on the stamp price’s history and its changes relative to inflation.