Make Sure Your Gift Cards Don’t Go to Waste

The Associated Press is reporting as much as five billion dollars of what Americans spend on gift cards each year will go unused – that is, gift card recipients will leave that much in small balances on their cards.

In order to make sure your valuable gift card dollars don’t go to waste, consider these tips for maximizing their benefit.

  • Buy what you need. Those of us who have had to pinch pennies or cut back in some way since the recession began would do well to treat gift cards like normal money. That means using them for necessities rather than items we wouldn’t have bought otherwise. Cards redeemable at a variety of retailers are especially handy for this.
  • Keep track of the plastic. Rather than tossing a gift card aside or piling it with other gifts, keep in it a safe place like your wallet or with other gift cards. Losing a gift card is the same thing as losing cash.
  • Go over the limit. The chances that you’ll find something you need for the exact amount your card offers are slim. To make sure you get the entire benefit from the card, spend a bit more than its value. That way, nothing goes to waste.
  • Work the sales. In the weeks following Christmas many stores have excellent sales, and if you hit the shops sooner rather than later you may be able to avoid picked-over or under stocked merchandise. Plus, discounts will allow you to make the most of your gift card.
  • Get what you really want. If you’ve gotten a card or cards to a store you don’t particularly like, considering visiting a site like CardHub.com or getting together with friends to exchange your card for one you really want.
  • Watch the expiration dates. Read the fine print on your cards. Credit-card “cash cards” usually carry and expiration, and some store cards may expire too, or lose some value.

When You’re Giving Gift Cards

Gift cards are often a great option when you know the recipient likes to shop or has picky tastes, but make sure you know what you’re getting when you buy one. You and your loved ones can save money with a little up-front research.

Some credit card branded gift cards, while versatile, have several-dollar activation fees that can seriously cut into the amount of money you want to give ($6 is common). Also, just like your credit cards, many of these cards have expiration dates, though they are typically good for a year.

Store-specific cards generally avoid such fees, so if you know where a loved one likes to shop, that may be your best bet. Also, keep in mind that some stores have more versatile offerings, and a gift card to a Target or Wal-Mart let the recipient choose from the fun to the frugal when shopping.

Additional Credit Card Reading:

Comments on Proposed Rules on Gift Card Provisions in Credit CARD Act