Saturday, November 15, 2008

The Dangers of Gift Cards

Consumer Reports has an interesting article on Avoiding Gift Card Pitfalls. Last year unused, lost and expired gift cards cost consumers $8 billion. That is pure profit for retailers. No wonder they push gift cards so much.

Did you also know that once a company enters bankruptcy, they do not have to honor their gift cards. Check out this article from the LA Times about how consumers may be out of luck in retail bankruptcies.

Despite all this, the estimates for gift card sales for this year top $100 million. If you plan on buying gift cards this year, please read the Consumer Reports article and the LA Times article so that you can at least be an educated consumer. If you're truly stuck on what to get for someone on your list, I recommend cash. It never expires.

With the financial problems that many stores are having I personally plan to avoid giving gift cards this holiday season. And if I receive any gift cards I will be using them as quickly as possible. This past weekend I even gathered up all the gift cards I had around the house and started using them up.

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