Do You Have Any Unused Gift Cards?

In the August issue of Money magazine, they list gift cards as being potentially the worst gift ever (if you get one from a place where you don't shop.) They also cite the following stats about gift cards:

• 49% of Americans have at least one unused gift card
• The average number of gift cards that people have is 3.7

We currently have several unused gift cards as follows:

• Sears - Left over from my elliptical issue with them. We're saving it for Christmas purchases and/or for work if/when we get our new house.

• Macy's - Left over from Christmas last year. We hardly ever shop there and will probably use this for Christmas gifts this year.

• Local ice cream place -- My daughter received for her birthday last year.

• Bed Bath and Beyond -- From a rebate (I hate those things!)

I have a list of the cards we haven't used and I make sure we do eventually do use them, but it requires some diligence. I can see where others who aren't quite as organized could lose track of them.

The Money piece suggests people resell their cards at PlasticJungle.com if they'd rather have the cash. Anyone used this site (or one like it)? Thoughts?

How about you -- are you currently holding on to any gift cards?

Comments

[Lauren]

The worst thing about the gift cards is once you get them down to just a few dollars left then you don't want to use them because then you'd have to pay the remainder. I hate that. This is what I have currently - and only one of them is enough to cover a whole purchase (the Williams-Sonoma one).

$14 to a day spa I don't really like
$8 at H&M
$6.40 for Hot Topic
$1 for Dave & Buster's
$28 for Williams-Sonoma
$14 for Ann Taylor Loft

[MonkeyMonk]

We've got a bunch in a drawer somewhere that are all partially used-up -- most with under $10 on them. They're mostly for stores that we like well enough when the items are completely free but no so much that we get excited about spending money there if the purchase is going to use up the remiander on the card and then start costing us money.

[CF]

Before considering gift cards as "potentially the worst gift ever", you really need to make a fair comparison. What percentage of actual gifts that you receive would you buy for yourself? How many "never-worn sweaters" or "never-used golf-putting toys" do you have in your house or have you given away or thrown out.

Let's say 60% of gifts you receive are things you actually like and use. As long as more than 60% of the money on gift cards is used, you could argue that it's a better gift. In fact, the percentage could be less, since gifts you don't want create waste and clutter etc.

I'm not factoring emotion or thoughtfulness or other factors into this - just looking at it in pure economic terms.

What do you think - does that make sense?

[Apex]

Gift cards are the worst transaction I know of.

Think about this. You have in your wallet cash. Cash that can be used anytime, anywhere, and is always worth the same face value no matter how long you hold it.

So you take this cash and give it to a merchant for which you have nothing in particular you want to buy for the purpose of giving it to someone else who you don't know if they have anything in particular they want to buy there either.

And what do you get in exchange for giving them this cash. You get a piece of plastic which is equivalent in value to the cash you gave the merchant. But you lose flexibility in the following ways.

1. Now instead of being able to be spent anywhere, it can only be spent at stores for this merchant.
2. It may have an expiration (most do) where if you don't spend it by a certain date it is worth zero.
3. It may also have a decay factor where after a certain amount of time it starts to lose value and eventually goes to zero value if you don't spend it.

In addition to those built in draw backs, you now have this piece of plastic that you have to either carry around with you everywhere (like you don't have enough plastic in your wallet) or you have to remember to bring it when you end up going to this merchant.

Usually when I get to the merchant then I remember, oh yeah, I had a give card for this place. Didn't remember to bring that along.

Why would anyone trade universal cash that can be spent anywhere, anytime, without losing value, for something that can be spent at only 1 location, for only a limited amount of time and might lose value? Usually to make a trade off like that you would have to get something in return. All you get here is something that is a bigger hassle to use and they you usually won't carry with you and thus have to remember where you put it and remember to bring it along when you need it.

They are the worst exchange of cash for services that I know of. You give up a lot and gain absolutely no value in return. None!

The real problem is we live in a relatively affluent society for which obligatory gifts are still practiced but for the most part no longer necessary or even helpful. Other than gifts for your kids, why would you get another adult a gift? They already have everything they need. If they do need something, you probably don't know what it is, and if they just want something you probably don't have quite the same tastes as them to get them just want they want. So we now create lists so you go get someone something off their list. Jeez, I can go buy my own stuff off my list if I want it. So now I have to come up with a list of things I might want, so that people who feel compelled to get me gifts know what to get me? Stop with the gifts already. Just show up and share a family meal. Isn't that more important than all the gifts?

Ever go to the store on Dec 26? The return lines are huge. We waste all this time worrying about what to get someone and then we buy them something they don't want and they just return it to the store and get cash. So instead we get them gift cards which are less valuable than cash.

Our society has outgrown obligatory gifts by a long way. Christmas is the most stressful time of the year for almost everyone, because we are all tied up in knots worrying about gifts for everyone because it has become society obligation. And out of this came gift cards. What a boon for the retail industry. Its just like free money for them because so many of the cards never get used.

[Apex]

CF makes a good point.

Which is why obligatory gifts for adults at Christmas or any other time is something we should have long since dropped. There are much better ways to show appreciation for someone than wasting money on things they probably don't want or need.

[justin]

We started doing gift cards for the Christmas exchange with adults in my family, but we're a small family and we always make sure that it gets communicated to the gift buyer where we want our cards from. I'm always sure to ask for Sears or Walmart since I always know I can find things I like there.

[Kevin]

I have about $6 in Borders in my wallet, but I'm thinking of using it to buy The Last Lecture book after watching the special on Randy Pausch on ABC last night.

[Mar]

Justin, your comment pretty makes the point that some other commenters were also making. If you are letting the gift giver know which card(s) you want, why bother? Why doesn't everybody just save themselves the hassle of going to the store, wrapping, etc., and drop the gift exchange?

Hope no one has Bennigan's gift cards or, if you do, that your local restaurant is franchise-owned, not one of the corporate locations that closed yesterday.

[Walden]

I like getting gift cards because it forces me to spend some "free" money on getting something fun for myself. I'm usually so frugal that I don't ever spend money on myself, and getting a gift card to someplace like Nordstroms lets me buy something discretionary for myself without feeling gulity!

[wiehn]

If you want to get someone a gift card then purchase a prepaid credit card...it works anywhere not just at one paticular store. That way the reciepent gets to buy what they want where they want and that was the whole idea of the gift.

[justin]

Mar, I posed that very question last Christmas. But it is "Christmas" and we have to "get something" for each other. It boils down to tradition more than practicality. Maybe I can make my case better this year. :)

[Jim]

Gift cards aren't very practical. But then giving gifts at all isn't really practical. Giving is the point of gift giving, not practicality.

I actually enjoy getting gift cards and my friends and family know enough to give us cards that are for places we frequent. Gift cards certainly do have downsides. I've got a Cheesecake factory card in my wallet with only a few dollars on it. The balance is not enough to cover a meal or give me reason to go down there and so it will likely go unused.

Jim

[Emily]

Don't hang onto them for too long -- many expire, or start charging a fee if you use it past a certain date! Also, if the company goes out of business, you're tough out of luck. That happened to Sharper Image gift card holders earlier this year.

[Bad_Brad]

I disagree with Apex and Jim. I think gift cards are very practical as gifts. As an example, I know my wife likes shopping at Ann Taylor, but I have no clue what to get her at Ann Taylor. A gift card makes perfect sense. I know my nephew is a technophile and buys a lot of stuff at Best Buy, but I would have no idea what to buy him there. Gift card makes perfect sense in both cases.

One thing that no one has brought up yet is that gift cards, in most states, are escheatable property, i.e. after some period of time, the merchant is actually required by law to report and remit unused gift card balances to the state. This is where much of that "unclaimed property" that you always hear about comes from. Quite a boon to the state. If you ask me, escheatment should really be called "cheatment" because the state is basically telling a private sector company that we don't trust you to hold these funds for this person, let us do it instead. :)

[Austin Chu]

It's true. Don't let your gift cards go unused or let them expire. I work for a company that manages and tracks gift cards and we blog about gift card issues on savvywallet.com. Consider this, last year we spent $100B on gift cards and around $8B was lost. Also, I've been following retailers filing for bankruptcy, and some of them aren't honoring gift cards anymore. Don't forget The Sharper Image incident: $25m in unused gift cards.

[Austin Chu]

Ponderosa and Bonanza are still accepting Metromedia gift cards. I'm not sure about franchise owned Bennigans's. My advice? Go spend your gift cards, we simply do not know how long they will be accepting them. Don't forget The Sharper Image incident: $25m in unused gift cards.

-Also, you can file a claim. Call this number for more details: 1-800-727-8355 and press 2

[J Will]

I sell my GC's at giftcardbuyback.com. They buy most GC's and you get your check in around two weeks. You don't have to worry about trading or waiting for your GC's to sell. I prefer the quick transaction, so I can have my cash.

[Slinky]

I think gift cards are good for when you want to buy someone something like a game or a book or clothing. You know what you'd like to get them, but you have no idea what they already have or would actually like. That said, If you don't know what a person would actually like, give cash not a gift card.

For christmas, my grandmother got me a gift card to a music store. She knew I really wanted a piano/vocal score from a couple musicals, but didn't want to buy the wrong thing. So she gave me a card. I went and got exactly what I wanted and only had to pay 3 cents for it. (It came to $20.03) It's honestly the only thing I remember getting from christmas.

On the other hand, for my graduation someone gave me an itunes gift card. I don't have an ipod, and I refuse to install iTunes on my computer. I hate music with DRM, because I often upgrade hardware and reinstall my operating system. I also like to make cds for my car. I only keep copied cds in my car so that if they are stolen I don't really lose anything. So I sold it to my friend for $5 less than it was worth. Then I went to Barnes & Nobles and bought some new books.

So gift cards are nice when properly used, and usually a waste when they're not. Don't give them unless you know the person will enjoy it....just like any other gift you would give.

[Gerard Holton]

I just sold my Best Buy gift card and an iTunes card at giftah.com without any problems whatsoever. I had no idea such services even existed until I read about Giftah on lifehacker.

I liked it over the others ones because it is inredibly simple to use, charges the least and on top of that they offer a "Verified by Giftah" service which basically checks the card's balance is what the seller states, so this helps both the seller's credibility and gets more bids...

[Janna Nikkola]

I received my first Vanilla Gift Card on 5/8/08 for $50. It had been activated on 5/7/09. When I first attempted to use the card on 3/7/09 I learned it was not worth $50; it was only worth $37.50. Unbeknownst to me or the person who gave it to me was that Vanilla Gift Card deducted $2.50 per month from the card as a "Monthly Maintenance Fee". In very fine print on the card is says "Starting in the 13th month Monthly Maintenance Fees" will be assessed" -- but I'd only had my card for 10 months. I am certain the person who gave me this card was not aware of these fees. If she had known, I know she would not have given one to me. This is the latest round of scams and ripoffs by American banks on consumers. What's worse, I understand that up to 90% of ALL gift cards go unclaimed, so that's just giving money away to these greedy and avaricious banks.