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Subscribe to RSSTODAY financial editor Jean Chatzky explains how you can sell your unused gift cards for a portion of their face value and also purchase new gift cards without paying their full price.
Gift cards are the most-wanted holiday gift again this year – ahead of jewelry, clothing and even electronic gadgets. According to the National Retail Federation’s 2011 holiday survey, eight out of ten holiday shoppers plan to buy gift cards. They will spend an average of $155 on them.
Let me share a little secret. You don’t have to pay full price for gift cards. You can get them from resellers and save anywhere from 8 percent to 35 percent. These cards are for well-known retailers, from Abercrombie & Fitch to Zappos.com.
“You give someone a $50 gift card and they think you’ve spent $50, when in reality you only spent maybe $40 to buy it,” says Odysseas Papadimitriou, CEO of Card Hub.com.
To do that, you need to have the card sent to you and then you give it to the person on your list. Most gift card resellers do not charge for shipping.
What if the card is scratched and doesn’t look new?
“Go to the store where the card is sold and ask them to give you a new card with the same value,” Papadimitriou advises. “That way you get brand new plastic to give to your friend or family member who will have absolutely no clue.”
What if the card is loaded with an odd amount?
That’s often the case at these resale sites. I just went online and found a Coldwater Creek card for $139.41 on sale for $118.50. That’s 15 percent off. But you’d never give someone a gift card loaded with a crazy amount like that. It’s a dead give-away that you bought the card from a reseller.
Again, there’s a way around that. You can go to the store and ask them to split the card. For example, you could get two $50 cards and have the rest ($18.50) put on a third card you can use. Or you could pay an extra $1.50 and make the last card worth $20.
Buy discounted gift cards for your holiday shopping
Many savvy shoppers now buy discounted gift cards to use, rather than to give away. It’s like cashing-in on an instant sale.
“I buy the gift cards for myself,” says Kristin Morse, vice president of marketing at Plastic Jungle.com, one of the big gift card resellers. “So I save money before I even go into the store.”
Morse says she likes to stack her savings, using the discounted gift card to buy things that are on sale. If there’s a coupon, that’s even better.
"It adds up to where you can really stretch your dollars,” she says.
Morse tells me about 80 percent of their customers buy gift cards to use for themselves. She says that extra little bit of savings lets them get what they really want.
If you decide to use the resale market, be sure to deal with an established website, such as Plastic Jungle, Gift Card Granny, Card Hub, Cardpool, GiftCards.com or Gift Card Castle. Always pay with a credit card, not a debit card. That gives you extra fraud protection should there be a problem.
The ultimate in convenience
The 2011 Gift Card Survey by Bankrate.com found a significant rise in the availability of e-gift cards that are emailed to the recipient.
Starbucks, Best Buy, Gap, Pizza Hut, Staples, Overstock.com and American Express all added a virtual version of their gift cards in the last 12 months. Amazon lets you send gift cards via Facebook.
“It appeals to the last minute shopper, maybe someone who got a gift they didn’t expect and they want to respond to it,” says Bankrate’s Janna Herron.
Some electronic gift cards are printable (like e-tickets); others are simply a promotional code the recipient uses when shopping.
“E-gift cards still make up a small percentage of overall gift card sales, but that segment is growing,” Herron says.
Because an e-gift card could be confused with spam, it’s a good idea to contact recipients to let them know what you did. You might even want to follow-up to make sure they got it.
Know the rules
Gift cards are much more consumer-friendly because of federal rules that took effect last year. According to the Federal Trade Commission:
- Money on a gift card cannot expire for at least five years from the date the card was issued or money was loaded onto the card.
- Inactivity fees cannot be charged until the card has not been used for at least one year. You can be charged a fee to buy the card or to replace a lost or stolen card.
- The expiration date of a card must be clearly disclosed on the card, and fees must be clearly disclosed on the card or its packaging.
More info:
Federal Trade Commission: Buying, Giving, and Using Gift Cards
Leave a Comment:
To me, gift cards are terrible for Christmas. It's like saying "I don't know you well enough to buy you something you'd like so buy yourself something instead". You might as well come to an agreement with the person you are exchanging a gift with where each of you just keep your money and buy yourself something.
For someone you absolutely don't know sure get them a gift card, but if you know them, spend the time picking out something you think they'd like. And if you are truly unsure, include a gift receipt with it when you give it.
If you need extra cash, this seems to save me some extra money every month
there are BILLIONS of dollars a year make on UNUSED gift cards every year. that is why the card companies sell them. gift cards are your biggest wast of money there is. I tell people that give me gift cards for anything to keep them and gave me cash or nothing.
Took a look on all of the recommended sites. Didn't find anything I was interested in with a discount that would make it worth the effort. Too bad.
"The rest" would be $39.41.
"The rest" of the original amount would be $39.41, but he says that the card was on sale:
which would mean "the rest" would indeed be $18.50.
Dear Jan,
If you asked a store to split a gift card whose value is $139.41 into two $50 cards and a third card with the remainder, I think you'd be pretty upset if that third card ended up with only $18.50 on it.
Take a minute to think about it.
Jan,
While the card was on sale, he still got the value of $139.41 he only paid $118.50 for it.
I would rather get a gift card than a present I can't use or didn't want. By giving you a card they are telling you they do know what you like but want to give you the flexibility to pick your things specifically.
I love receiving gift cards...but it depends on where their to. My family knows that I rarely ever spend money on myself, it always goes to the kids. So, if I get movie tickets, coffee card, airline certificates (I love to travel)..well I get excited and I will use them on myself cause those are little "treats" and I rarely spend my own money on them (except for airline tickets). But if I get a Target card or something like that...chances are I wont spend the whole amount on myself..I will buy something the kids need, or food, whatever. Its just like cash..I cant guarantee I'll spend it all on myself :)
Personally, I am not a big fan of gift cards. But I think there are other ways to save on gifts and find unique and meaningful things that people will enjoy opening! I like to shop online and use coupons and sales to save money. I like sites like www.discounts.ca - just use the coupon codes and ship it directly to the person you're giving it to! I think that is just as easy as sending an online gift card!
I like to give and receive gift cards. That way, nobody has to return a gift that they don't need, don't like, doesn't fit or can't use. As I told someone today, "I've already bought your gift and I guarantee you'll like what you buy with it". Returning things is a drag and even worse is getting a gift that you don't want that can't be returned - it's a real waste of the giver's money.
I do miss the whole element of surprise and delight you get when you gift someone something they love - gift cards don't get quite the same reaction - but I truly believe people enjoy spending them ... I know I do!