The convenience of gift cards make them a must buy during the Holidays. You can pick up a few on the way out of the store and, presto, your relatives or friends have a gift. Retailers are making the purchase of gifts cards even easier by offering digital versions of the real thing. So, are gift cards really worth your money?
Sure, there are pros to giving the gift of a little plastic card. You can send them in the mail for the price of a stamp and give your daughter a nice dinner. Or your grandson that new video game he is dying to get. Some people even prefer a gift card to cold hard cash. Cash would be saved and spent on something that is needed. A gift card to Red Lobster or Game Stop? Those are for fun and games (sometimes literally).
This year, according to the National Retail Federation, more than $31 billion will be spent on gift cards. That is roughly $173 per person.
While the cards are around to stay, Consumer Reports gives reasons why you should not be stuffing those stocking with plastic. Some "gift" cards are plagued by activation fees, dormancy fees, and are impossible, or nearly impossible, to replace. Not to mention that there is no real protection for your funds or the ability to dispute purchases, should the card number wind up in the wrong hands. And, of course, most gift cards have a very limited acceptance.
Keep in mind that not all gift cards have these limitations. If you are giving or given cards this year be sure to look into the terms and conditions of using them.
The Consumerist reports that people may not even want to receive gift cards this year.
Every year, the super-consultants at Deloitte LLP ask people whether they're interested in receiving and giving any gift cards this holiday season. We used to love the concept: Back in 2007, 69% of people said that they were interested in receiving the plastic cash replacers. This year, that number is down to 37%.Though, there is always someone that is explicitly asking for them. Just remember that a gift card is not a reason to be lazy and just grab the first one you see. They can be as thoughtful as any other gift. If your sweetie fancies herself as a make up artist but refuses to buy the tools of the trade for herself, you can always give her a card for Sephora. The thought in the gift is what always matters.
Then again, gift cards can always be sold to someone else if they are really unwanted.
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