Got a Plan for Your Unwanted Holiday Gift Cards?

| No Comments | No TrackBacks
You might think that the holiday shopping season concludes once the mad dashes for last-minute presents have been run and the carefully wrapped paper has been torn away and discarded, but that's certainly not true in the modern gift card era. According to the National Retail Federation, gift cards were the most requested present for the fifth straight year, and the 80% of holiday shoppers who gave them spent an average of $155.43. While this, of course, means that gift card recipients all over the country have been out putting their plastic to use and will continue to do so in the days and weeks to come, not everyone likes the gift cards they were given.  This begs the question of what you're supposed to do with an unwanted gift card.

Sell it for cash
Prior to the holidays, about 25% of consumers had an unused gift card remaining from last year, according to a Consumer Reports poll, and 55% of that group had two or more.  That's a lot of untapped potential just sitting there, which is especially important when you consider that roughly 29% of consumers leveraged credit card debt in order to pay for holiday gift giving, according to American Express.  For those who need some extra cash to pay off holiday bills, an online gift card exchange can be quite helpful.

A gift card exchange operates in much the same manner as eBay without the bidding.  You can list a gift card for sale, designate how much you want for it, and wait for one of the individual consumers or trusted companies in the community to purchase it.  While I'm obviously biased, Card Hub is the only gift card exchange that allows you to list a gift card from any merchant with any amount on it.  Depending on the particular card, you can expect to get up to ninety-five cents on the dollar in return.

Regift it
Selling an unwanted gift card for cash certainly is not the only option you have, however.  Regifting is another interesting application as well.  Gift cards are given for pretty much every special occasion you can think of, which means that if you don't want to sacrifice any value in selling a card for cash, you can simply pass it along to someone else who may like the store it's tied to.  Most stores allow you to purchase new gift cards with old ones, so there's no need to worry about giving a holiday-themed card for a birthday, anniversary, etc. a few months down the road.  In short, whomever you give an unwanted gift card to never has to know that it is second hand.

What else is there to know about gift cards?
By now, you're probably coming to the realization that there's a lot more to the gift card industry than meets the eye.  Therefore, whether you plan on making a purchase with a gift card this year or otherwise putting it to use, it's important to keep the following in mind:
  • Better disclosures during holiday season 2011:  One of the benefits of the CARD Act is that it included rules requiring gift card issuers to print disclosures about expiration dates, fees and other important terms and conditions on their cards.  This was the first holiday season that the new disclosures were in full effect, so determining when or how to use a recently bought gift card is now as simple as looking at it.
  • You can avoid fees:  General-use gift cards from Visa, American Express, etc. come with fees.  Stores don't need service charges because they profit as soon as you buy a gift card, which is obviously not the case for credit card companies.  As a result, if you have a general-purpose gift card, make sure you use it as soon as possible.
  • Watch out for overspending:  According to Consumer Reports, two-thirds of consumers spend more than the face value of their gift cards when redeeming them.  If you do this, make sure it's for the right reasons (subsidizing necessary big-ticket purchases), not simply because gift cards may seem like play money.
This guest post was written by Odysseas Papadimitriou, CEO of Card Hub, a leading online marketplace for gift cards, prepaid cards, and the best credit card deals

Enhanced by Zemanta

No TrackBacks

TrackBack URL:

Leave a comment

A memoir exposing the steep price consumers pay when facing mortgage servicing errors, inaccurate credit reporting, illegal debt collection practices, identity theft and weak consumer protection laws. THE BOOK » DENISE'S STORY »