Gift card use has increased dramatically the last couple of holiday seasons and this year looks to be the same. These cards can be great for both consumer and retailer, as they provide a more decorative way to give cash as a gift at the same time ensuring a selected retailer gets your commerce. But, are they all really as great as they seem?
Not according to Consumer Reports, who ran a full page ad in the New York Times warning shoppers of the potential waste of unused, lost or expired gift cards. Even so, these cards still seem to be the top of many holiday shoppers lists this year. Plus, many recipients love getting a practical gift they really can use.
How do you balance the downsides of gift cards with the advantages? The key is in carefully matching a gift cards to the individual as well as reading all the fine print.
Bank-issued cards tend to be the most flexible for the person who truly has everything. These cards are taken almost anywhere and are far more like handing over a check than any other type of gift card. The trick with these is to really do your research. Many bank-issued cards have fees and expiration dates that can quickly waste your hard earned gift money. Don’t waste your recipient’s time trying to navigate through all the tricks of these types of cards. If you choose to give one, try to find one that is truly fee free.
Retail specific cards will restrict the use of the money, but can make the gift a bit more personal. They also tend to have fewer fees and other restrictions, but they are not all created equal. These types of gift cards also need to be researched before given. In your research, ensure that the person receiving the gift has easy access to the retailer and that the dollar amount makes sense with the merchandise available. A good rule is to find a few items at the retailer your recipient might enjoy and use those prices as a gauge.
Gift cards can be fun to receive, almost like an instant shopping spree. They can be practical for those that either don’t spend regular time with the people on their shopping list or have no idea of a good gift. Just be sure that you take the time to understand exactly the gift you are giving to determine if it really is what you want them to receive.
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