Be a Savvy Gift Card Giver and User

You’ll probably give and receive at least one gift this holiday season. Gift cards, a one-size-fits-all way to give a present, have skyrocketed in popularity in recent years. With money tight, it’s more important than ever to be savvy about buying and giving gift cards. And on the flip side, make sure you properly use the ones you receive.

Smart ideas for buying a gift card:

  • Consider how your recipient will use it. Gift cards come in two varieties: Retail gift cards are sold by retailers and restaurants and can be used only with those merchants. Bank gift cards display the brand logo of a payment-card network, such as Visa, MasterCard, American Express, and so forth. You can use these national-branded gift cards wherever the brand is accepted.
  • Avoid fees and expiration dates. Fees might be charged at the time of purchase or can be deducted from the card after you pay for it. In the store, fee details usually are posted on the gift-card sleeve. Online, look for details posted on the issuer’s website. If you’re buying by phone, ask about shipping and handling fees. Always check for expiration dates.
  • Inspect the location and condition of the card. In stores, look for gift cards located safely behind the cashier’s counter or customer-service desk. Don’t buy a card that appears to have been tampered with. For example, make sure the protective sticker is intact and the code on the back has not been scratched off. One form of gift-card theft is to write down an exposed gift card number, monitor it online and, when activated, quickly access and drain the card before the owner becomes aware of it. Online, avoid buying gift cards from auction sites–they may be selling counterfeit cards or cards obtained by fraud.
  • Watch the cashier. Make sure the amount you pay is the same as the value of the card. The best way to do this is to watch the cashier scan the card. One popular scam is for a cashier to pretend to activate the card, hand it to you, and pocket your money.
  • Investigate the financial condition of the card seller. The card may lose value if the issuer goes out of business or files for bankruptcy. Another possibility is that the issuing business closes a store near the recipient.
  • Give a receipt along with the card. If the receipt doesn’t include the card’s ID number, provide it as well. If the card gets lost or stolen, the receipt and ID number help the retailer track where the card was activated and used, and usually will qualify the recipient for a refund or replacement.

Tips for using a gift card:

  • Ask the giver for important card information. This includes the original purchase receipt and the card’s ID number. If not obvious, find out where you can use the card, the terms, conditions, expiration date, and fees. Write down or photocopy the toll-free number for reporting lost or stolen cards; keep this information in a safe place.
  • Use it soon. This is especially the case if you still have a card you received last year. This helps you avoid possible maintenance fees, expiration, or misplacing or losing the card. Better yet, you can take advantage of post-holiday discounts.
  • Think of it as cash. Although some issuers will replace lost or stolen cards, you might not be able to recover any of its value, or might have to pay a fee to do so.

If you have a problem with a gift card–say the value has expired, you are charged a fee, or it’s been lost or stolen–contact the toll-free number of the card-issuing company to see if it still will honor the card or reverse the fees.


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