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Penny Pinching: Postal Service Will Increase Rates in January 2012

Photo of a old U.S. postage stamp by MarkauMark /
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They're broke, getting increasingly obsolete, and now they're upping their prices: The U.S. Postal Service will raise postage prices in the new year.As of January, 22, 2012, the cost of a first-class stamp will go up a penny to 45 cents. Other postage rates will jump up, too.

Here's how the USPS breaks down the new pricing structure for letters and postcards:

* Letters (1 oz.) - 1-cent increase to 45 cents
* Letters additional ounces - unchanged at 20 cents
* Postcards - 3-cent increase to 32 cents
* Letters to Canada or Mexico (1 oz.) - 5-cent increase to 85 cents.
* Letters to other international destinations - 7-cent increase to $1.05

Express Mail and Priority Mail prices will not change, however there will be increases for Standard Mail, Periodicals, Package Services and Extra Services.

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Why the increase?

“The overall average price increase is small and is needed to help address our current financial crisis,” said Postmaster General Patrick Donahoe. “We continue to take actions within our control to increase revenue in other ways and to aggressively cut costs. To return to sound financial footing we urgently need enactment of comprehensive, long-term legislation to provide the Postal Service with a more flexible business model.”

Other options the USPS is looking into for saving money are to cease Saturday delivery and/or close post office locations.