Blogging for Change

The wise giving & receiving of gift cards

by Kim McGrigg on
11/25/2008
in Budgeting and Building Savings

Gift cards are on the top of many people's holiday wish lists. In fact, TowerGroup projects that 2008 sales of both financial service institution-branded and private label gift card will total $88.4 billion. While this number is impressive, it does represent a decrease of 8.9 percent as compared to 2007.

One of many reasons consumers might be planning to spend less on gift cards is the proliferation of emails that have been circulating warning consumers to expect trouble when trying to redeem gift cards at stores that are going out of business.  It is true that there have been many store closings and business bankruptcy filings in the past months.  However, according to Snopes.com, most fears that gift cards may suddenly lose their value or won't be redeemed are unwarranted or premature.

That having been said, I agree with other financial writers that it is not worth the risk to put off redeeming gift cards.   If you are on the receiving end of a gift card, it is safest to use the card sooner rather than later.  If the store does not suit your tastes, you can try to swap the gift card at SwapAGift.com, CardAvenue.com, or PlasticJungle.com (Note: only regift a gift card that can actually be used!)

If you are buying gift cards as gifts, be sure that you understand the fine print.  Generally, there are no guarantees that your card will hold its value if a company enters bankruptcy.   

Following are some gift card purchasing tips:

-Consider giving cash instead of a gift card
-Consider bank-issued gift cards
-Consider mall gift cards that can be used in any of the mall's many stores
-Look for stores that are not likely to close (i.e. grocery stores)
-Ask store management about their gift card policies
-Ask about expiration dates, purchase exemptions, and fees
-Read the fine print on the card before you buy

Here is a link to a selected list of major recent retail closings: http://www.npr.org/templates/story/story.php?storyId=90142717

Kim McGrigg is the former Manager of Community and Media Relations for MMI.

Recommended Articles

Man sitting in front of pile of bills, trying to understand his options.
Professional Budget Advice
Make the most of every dollar and start building toward your dreams! Budget counseling is FREE and available 24/7.
Learn More
Learn more
  • MMI is a proud member of the National Foundation for Credit Counseling (NFCC) National Foundation for Credit Counseling
    MMI is a longstanding member of the National Foundation for Credit Counseling® (NFCC®), the nation’s largest nonprofit financial counseling organization. Founded in 1951, the NFCC’s mission is to promote financially responsible behavior and help member organizations like MMI deliver the highest-quality financial education and counseling services.
  • Council on Accreditation - official seal Council On Accreditation
    MMI is proudly accredited by the Council on Accreditation (COA), an international, independent, nonprofit, human service accrediting organization. COA’s thorough, peer-reviewed accreditation process is designed to ensure that organizations like MMI are providing the highest standard of service and support for clients and employees alike.
  • Financial Counseling Association of America Financial Counseling Association of America
    MMI is a proud member of the Financial Counseling Association of America (FCAA), a national association representing financial counseling companies that provide consumer credit counseling, housing counseling, student loan counseling, bankruptcy counseling, debt management, and various financial education services.
  • Department of Housing and Urban Development - Equal Housing Opportunity Department of Housing and Urban Development
    MMI is certified by the U.S. Department of Housing and Urban Development (HUD) to provide consumer housing counseling. The mission of HUD is to create strong, sustainable, inclusive communities and quality affordable homes for all. HUD provides support services directly and through approved, local agencies like MMI.