Everything you need to know about gift cards
Check your wallet or purse. Chances are you’ve got a couple of gift cards stashed in there. They have been the most wished-for present for 13 holiday seasons running, with 59% of respondents to the recent National Retail Federation poll requesting them. Sure, they take the “I picked this just for you!” element out of giving, but isn’t it better to have one fewer itchy sweater?
As their popularity grows, gift cards are also becoming more versatile. You can give them digitally, sell the ones you don’t want, or swap them out for another retailer. Even some drawbacks that personal finance folks like me used to worry about, like expiration dates, are now the exception rather than the rule. But gift cards can still be lost, forgotten, or stolen. So break out those long-dormant cards and read my FAQ.
Do gift cards expire? And are there hidden fees?
Generally, no. The federal CARD Act of 2009 established protections around gift cards. It largely prohibits dormancy fees, the penalties once assessed if a card was not used for a certain period of time. (For gift cards, a dormancy fee means losing some value on the card.) Under the act, states are also allowed to add further consumer protections; California, for instance, has eliminated gift card expiration dates.
Do all merchants offer gift cards?
No. Most major retailers and restaurant chains do, but many smaller businesses do not. If you would like to buy one from a business that doesn’t, you can usually purchase an old-school gift certificate, though that might have an expiration date and other restrictions. You could also purchase a GiftYa—a personalized digital gift that can be given for any business for up to $100. (There is a $1.95 processing charge to purchase the “card.”) Recipients learn of their gift by email or text, then they download the app and link their debit card. When they pay with their debit card at that business, they’re credited the amount of the GiftYa they spent.
Is there any way to get a discount when I buy gift cards?
Yes. You’ll generally pay full price for gift cards at a store. But several websites and apps offer discounted cards or cards with cash-back offers, such as GiftCardGranny.com, GiftCards.com, CardCash.com, Cardpool.com, and Raise.com. So don’t pay full price if you don’t have to.
Can I use gift cards for one retailer at other businesses?
Yes, in some cases. Some chains allow you to use their gift cards at businesses that share a parent company. For instance, a Marshalls card can be used at TJ Maxx, Sierra, HomeGoods, and HomeSense. Gap gift cards can be used at Athleta, Banana Republic, and Old Navy. Same goes for Williams Sonoma, West Elm, and Pottery Barn. Check the back of the card or online to see if yours has this flexibility.
There are also Visa, Mastercard, American Express, and Discover gift cards, which can be used wherever those credit cards are accepted. (Note that these more generic gift cards often carry a small card purchase fee, ranging from $2.95 to $4.95 depending on the gift card’s value.) For spa and salon services, SpaFinder gift cards can be used at more than 27,000 salons and spas in the U.S., and Spa & Wellness cards can be used at 9,000 locations.
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What if I receive a gift card that I don’t want?
You have several options. You can sell or exchange unwanted gift cards on sites like Raise, Cardpool, and the others mentioned above. You will lose a percentage of the card’s value—the rate varies according to demand for your specific card—but at least you’re trading a gift card gathering dust in a drawer for cash.
Amazon customers can use Visa, Mastercard, or American Express gift cards to buy credit for future Amazon purchases.
Can I digitally store my gift card info?
If your wallet is already space-challenged or you never remember to grab your gift cards as you head out the door, you can digitally store them for free on apps like Google Pay, Gyft, or Stocard by entering the gift card information. Just find the gift card info in the app and the cashier will scan the barcode that appears.
What do I do if I have a gift card from a retailer that’s going out of business?
From Dressbarn to Toys “R” Us, we’ve witnessed a dizzying number of retail closures in the past few years. If you hear a business is in the process of closing, spend any relevant gift cards ASAP, or contact the store immediately to see if you can get a refund or similar compensation. Once the store shuts its doors, things get more complicated. If the business declared bankruptcy, chances are it’s not under any obligation to reimburse customers. If contacting the business doesn’t help and you want to press your case, reach out to your state’s consumer protection agency to file a complaint.
