Saturday, December 17, 2011

Maximizing gift cards

Chances are, you will be receiving a store gift card this holiday season.  It's easy to see why.  They are convenient, never go out of style, and easy to ship, or even send electronically.  But, actually using them might come with some unforeseen headaches, namely, what to do with a balance of only a few dollars left after a purchase.  I will discuss what you can do to make sure that gift card is truly a gift and not a lump of a coal.

Did you receive a gift card for something you like?  Great!  Did you receive a gift card for a restaurant that you never go to, and that was famously mocked in the movie "Office Space?"  Not so good.  Did you receive a Visa/Amex gift card?  There is another strategy you can use to get their full value as well.  Let's address each scenario below.  

First, for when you received a gift card for a place you like, do a bit of research before buying something to see how much it will cost. Certainly don't overspend, but it's much easier to just use the full value of the gift card in one shot rather than having an annoyingly small amount left.  Did you use it all?  Good.  No?  See the next scenario.

Second, if you are not able to use the full value of your gift card and don't want to fork over extra cash in order to use it, or just don't want the gift card period, you can do a couple of things.  Depending on how much is left, say, over $10, you can see how much the card is worth on a gift card re-seller aggregator site, such as Gift Card Granny.  Visit the site, pop in the name of the retailer, and hope that it is listed.  If it's an obscure store, you might be stuck with that balance.  But, if its a big name store, such as Home Depot, there's a huge market for their used gift cards. Depending on the site listed on Gift Card Granny, you will take a hair cut between 10-30% of the remaining value  From there, you can either get a PayPal credit, or be sent a check.

Third, if you received a cash/debit gift card, they can be used just like credit/debit cards, but sometimes combining them with other payment forms, when you are short the value of your purchase, can be cumbersome.  For example, if you have a $25 Visa gift card and an item costs $27, you need to make up the difference somehow, or n item costs $23, and you have a balance.  Just as with scenario 2, if you don't want to just spend to use the card, you have a great option.  Amazon's gift cards can be purchased for minimal amounts.  I recently had $0.24 left on an AMEX gift card and used it to give myself a $0.24 electronic gift card.  When I redeemed it, the value just got transferred to my Amazon account and now I can use that towards a future purchase without carrying around a cumbersome debit card.

The bottom line is to not get discouraged with gift cards if you have remaining value.  There are viable options that will serve everyone's interests.