By John Campbell
As some of the most widely available Stored Value Cards (SVCs), gift cards offer a convenient way for you to let a friend or loved one make a purchase on you.
However, before you make any gift card purchase you should read the fine print attached to the card. Some of the associated terms and conditions may change your mind about purchasing the card for someone you know.
The first thing you’ll want to look out for is where a specific gift card may be used and what it can be used to purchase. If you buy a retailer-issued card you may be required to use it only at select retailers. For example, a Best Buy gift card can only be used at a Best Buy retail location or on BestBuy.com. A gift card sporting the Visa or MasterCard logo may offer more flexibility in where it can be used to make purchases.
Although many gift cards are considered “same as cash” in regards to the goods and services they may purchase, they often can’t be used to make payments on other accounts. You probably won’t be able to use a Visa gift card to make a payment on your outstanding credit card balance. You also may not be able to get any cash back if you don’t use all of the funds available on the card. The restrictions associated with any gift card should be listed either on the back of the card or on the signup sheet for the card.
Once you’ve found out where the card can be used and what any restrictions may be, you’ll want to find out if there is any expiration date on the card. Some gift cards must be used anywhere from 6 months to 2 years after they’ve been issued. If you fail to use the card by the expiration date you’ll essentially throw your money away when you purchase the card. Any funds that don’t get used become pure profit for the card issuer.
The ideal gift card is one that doesn’t have any set expiration date. Many gift card recipients like to hold onto gift cards for a “rainy day” when they might not otherwise have enough cash to make a purchase.
You’ll want to find out if a gift card can be easily replaced if lost or stolen, especially if the person you plan to give it to has a tendency to lose a lot of stuff. You may need to have a receipt listing the card number and available funds on the card and may also have to pay around $5 to replace it.
If you’re not sure if the full available balance on the card will be used you’ll want to find out if any portion of the card balance can be redeemed for cash. If not, you may want to reduce the amount of funds you place on the card or look for another card altogether.
If any of your questions about a gift card aren’t covered in the fine print, don’t buy the card. There are a lot of gift cards available today and many out there that are certain to meet your needs. With a little time and patience you should have no problem finding the perfect card to put a smile on the face of someone you know.
© cashbuzz.com
John Campbell is the writer and editor of CashBuzz, A financial portal for the rest of us. Check out cashbuzz.com for the latest articles on money management and tips and tricks that can help improve your finances. This article may be reprinted on your Web site if the copyright, author information and active link are included.
