6 ways to get the most out of your gift card
Did you get a gift card for Christmas? If so, here are six things to do:
Check now to be sure it didn’t get thrown out with the gift wrap or empty boxes.
Use it soon. Even if it doesn’t expire, you could lose the card’s value if the issuer goes bankrupt or you misplace it. Some retailers will replace lost cards with proof of purchase, but are not required to do so.
Ask for cash if the balance drops below $10. In California, merchants must — at the customer’s request — redeem a card worth less than $10 for cash. Again, this only
applies to single-retailer cards covered by state law.
See if there is an expiration date. Federal law created certain consumer protections that apply to gift cards nationwide. If a state imposes a law that is more protective, it generally applies.
California has a more protective law that only covers gift cards or certificates issued by a single retailer for use at that retailer or its affiliates — such as a Gap or Starbucks card. In California, these cards cannot have an expiration date or service fee, including an inactivity fee. This law covers gift cards that are purchased or given in exchange for returned merchandise.
This law does not apply to gift cards that can be used at multiple unaffiliated retailers — such as a bank-issued card that can be used at many stores in a mall or
one that carries the logo of a payment network such as American Express, Discover, MasterCard or Visa.
For these cards, federal law applies. Under federal law, money cannot expire for at least five years from the date a card was purchased, or from the last date any additional money was loaded onto the card. Inactivity fees can apply after a card has not been used for at least one year. But expiration dates and fees must be clearly disclosed.
Different rules apply to single-retailer cards that are given to customers as part of an awards, loyalty, promotional or rebate program; cards purchased at a discount by employers or nonprofits if the expiration date is within 30 days of the purchase; or ones for perishable food. They are exempt from the state law if they have an expiration date, printed in at least 10-point type, on the front of the card.
Swap or sell it. If you got an unwanted gift card, consider selling or swapping it through a marketplace such as Cardpool.com, ABCgiftcards.com or Cardcash.com. You will get less than the face value, but the more popular the merchant, the more you get.
Prices change frequently based on supply and demand. “Right after Christmas is the best time for both buyers and sellers” because inventory is high, says Elliot Bohm, co-founder of CardCash.
Giftcardgranny.com lets you compare offers from multiple gift-card exchanges. You can also sell gift cards at some Coinstar kiosks. For details see www.coin star.com/coinstar exchange.
Walmart.com is testing an online gift card exchange program through Cardcash.com. Participants must go to https://walmart.cardcash.com and enter the code from their plastic or electronic gift certificate. In exchange they will get an e-card they can use online or in stores.
The pilot program will accept cards from more than 200 merchants. Prices generally range from 70 to 97 percent of the card’s face value.
Based on a quick survey of five cards, the price that sellers get from the Walmart program is slightly better than the best price they could get if they went to Cardcash.com directly.
For example, people who want to sell a $100 Macy’s gift card and go to Cardcash.com would get a check for $75 if they sell an electronic gift certificate. If they mail in a plastic gift card, they would get $80 (for payment via check, direct deposit or PayPal) or $83.20 (for payment via Amazon gift card).
Under the Walmart program, they would get $84, whether they enter the code for an online or plastic gift card. (They cannot mail in a plastic card under the pilot program.)
Make sure your card is not escheated by the state. Some states (ex- cluding California) use escheatment laws to claim gift cards as abandoned property after they have been unredeemed for a certain number of years. “If you have a balance outstanding, the state can take away those funds if you let them go dormant for too long … even if you have the card in your possession,” says Joe Ridout, a spokesman for Consumer Action. Two states, Maine and Tennessee, claim the funds after two years of dormancy. Others claim them after three years. California does not engage in this practice.
Ridout explains that the federal law that limits cards from expiring applies to banks and retailers, not states. For more on individual state gift card laws, including escheatment, see http://bit.ly/NSsIkn.