traditionally meant gifts wrapped with ribbon and bow,
or maybe the occasional check in an envelope. But for
many harried shoppers, the default present has become a
fact, 8 in 10 shoppers are planning on purchasing gift
cards this year, according to the National Retail
Federation. The most popular cards are for restaurants,
followed by department stores and spas, according to the
Retail Gift Card Association.
as simple as it seems, giving and receiving a card can
offer complications. For one thing, itís the retailer
that often winds up with the gift, pocketing money spent
on the 10 percent to 12 percent of cards that never get
used. There are also fees and charges to consider.
are some tips for that stocking stuffer:
and conditions: When purchasing a gift card, pay close
attention to the terms and conditions. The card may be
redeemable only in a certain store or location. Dominoís
Pizzaís $100 gift card, for instance, can be used only
at specific participating stores. Or a card may not be
usable at a department storeís outlet locations.
is also important to check the card isnít damaged,
scratched or tampered with before your purchase.
receiving a card, register it on the website listed on
the card and write down details such as the card number,
customer services and any terms listed on the back.
Better yet, photocopy the front and bank of the card in
case the card is lost or stolen. Some stores, such as
Bloomingdaleís, will replace cards only with proof of
purchase, such as a receipt.
companies charge fees to replace lost or stolen cards.
These tend to be "open-loop" cards, or ones
typically issued by credit card companies, malls and
banks. These fees may range from $5 to $15, according to
the National Consumers League.
may be charged for checking the cardís balance or
transferring the remaining gift amount onto a new card.
Federal law, however, states that if funds are
available, a new card must be issued at no cost.
gift card doesnít guarantee the retailer issuing it
will exist forever; therefore itís best to use it as
quickly as possible. Thatís especially true if itís
from a pop-up store thatís around only for the
store could go bankrupt without notice. With a stroke of
a pen, the judge could declare all outstanding gift
cards null and void," said Mary Hunt, a Cypress,
Calif., personal finance author who runs the
gift cards, such as those from American Express,
Discover and the Citi Prepaid MasterCard, carry purchase
fees. This is an upfront fee, also known as a delivery
fee, that reduces the actual value of the card.
Citi Prepaid MasterCard is the most costly, at $9.95;
Amex and Discover both charge $3.95, according to Huntís
cards also charge "dormancy" fees ó that is,
fees that apply six to 12 months after purchase if the
card has not been activated. Those can vary from $1.50
to $2.95 per month until the cardís value has been
cards may also charge "maintenance" fees,
which range from $2 to $3 per month; those fees donít
depend on card activity.
addition, "if you overspend on a general-purpose
gift card, you may be subject to overdraft charges which
you werenít aware of," said Ellen Schloemer of
the Center for Responsible Lending.
you get an unwanted card, allís not lost. Rather than
letting it expire, you can sell it or trade it for
another card at a discounted rate on sites such as
GiftCardGranny.com and PlasticJungle.com. "I use
these sites a lot to buy other peopleís cards for
wedding presents; youíre looking at an average of 12
percent savings," said Andrea Woorch, a consumer
and money savings expert for Kinoli Inc., based in
experts say you should be cautious about buying used or
discounted cards from Craigslist.org and eBay.com, or
less mainstream sites. If pop-up advertisements tell you
youíve won a gift card that is unrelated to the
website you are on, or which then connects you to an
unrecognizable website, you probably should close those
keep one last thing in mind: Cold, hard cash still ranks
as the most desired gift of all, chosen by 37 percent of
respondents to a Christmas survey by Deloitte LLP, the
financial consultancy firm.