Pros and Cons of Giving Gift Cards

Should You Give a Gift Card?

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Are you planning on giving gift cards this holiday season? Are you wondering if gift cards make good gifts? The best answer is the one that fits for most gifts that you give — it all depends on who you are giving the gift card too and if the card that you select is for something that they will enjoy.

Gift Cards Get a Bad Rap

Overall, gift cards seem to be more popular to gift givers, than receivers.

Many on the side against giving gift cards consider it to be impersonal and gives an impression that the gift giver is lazy.

There are also reservations about giving gift cards that may accumulate fees, decrease in value or expire too soon. Fortunately, back in 2010 new laws governing gift cards put most of the consumer concerns to rest. Fees on gift cards are prohibited for 12 months after purchase and gift cards cannot expire before five years.

Why Some People Dislike Getting Gift Cards

A survey conducted by Consumer Reports determined that over a quarter of the gift cards given are never used.

According to the survey:

  • 58 percent of those surveyed said they did not use their gift cards because they didn't have time
  • 35 percent said they couldn't find anything to buy
  • 32 percent said that they either lost the gift card, or forgot that they had one.

But do those numbers show that giving a gift card a bad idea?

Not really. Imagine how many people receive gifts that never get worn, used, displayed, played or exchanged for something else. I shudder to think how much money is wasted on gifts that people really do not want and never use.

To help sort it out, let's take a look at the Pros and Cons of giving gift cards.

The Pros of Buying Gift Cards

  1. People can choose what they want to buy
  2. The cost of sending gift cards is a lot less than the cost of mailing packages
  3. The person receiving the gift card can get more bang for their buck by shopping with gift cards during peak sale times

The Cons of Buying Gift Cards

  1. Gift cards are easy to lose
  2. Some people believe gift cards are too impersonal
  3. Retailers may go out of business before a card is used

New Options for Unwanted Gift Cards

Today, there is no reason for someone to get stuck with an unwanted gift card. There are services that will buy unwanted gift cards for a portion of a card's value.

Cardpool.com and Swapagift.com are popular companies which provide services where you can sell, trade or buy discounted gift cards.

The services determine the amount to be paid based on the popularity of the card that is being sold.

Both sites also sell gift cards at a discount. This is a good option for people who often shop at the same store and want to maximize their savings.

Need Extra Cash?

Credit card companies reward customers with points, based on how much they charge to their account. The points can then be used to buy gift certificates to retail stores, restaurants and also for local services.

Swagbucks, offers customers the opportunity to earn points by watching short advertisements, completing surveys, or visiting websites. The points can then be used to buy gift certificates.

The gift certificates can then be sold to Cardpool or Swapagift for almost the face value.

Gift Cards Make Good Necessity Gifts

Giving gift cards to help pay for necessities soared when the recession hit in 2007. Gift cards for gas, groceries and drugstores are gifts that have value for anyone living on a tight budget.

The Bottom Line

Gift cards are like any other gift that you give. Before you choose one, you will want to think about the person that you are giving it to, their likes and dislikes, and try to select a card that will be appreciated. And just like every other gift that you give — what they choose to do with it after they receive it is up to them.

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