This is an opinion piece. The views are the author’s own.
Gift cards are the default holiday present for people who don’t know what to buy. They’re also one of the few products where the buyer pays full price and the seller gets to hold the money. That’s why I think we should stop treating them as a safe last-minute choice.
The Money Sits With Someone Else
When you hand over a retail gift card, the value lives with one company. If the store closes or goes bankrupt, the card may be worth less or become hard to use. The Federal Trade Commission has warned about exactly that, advising shoppers to consider a retailer’s financial condition before buying its cards.
The Rules Help, but Only So Much
Federal rules do give some protection. Money on a card can’t expire for at least five years, and inactivity fees can start only after a year of non-use, then only once a month. Fees to buy a card or replace a lost one are still allowed, and any fees must be disclosed on the card or packaging. Those rules date from 2010, so check the card’s terms for anything current.
Five years sounds generous. But a card tucked in a drawer is easy to forget, and the FTC itself says to use cards soon after you receive them. A gift that comes with homework is not much of a gift.
What I’d Do Instead
- Give a specific thing the person mentioned wanting, even a small one.
- If it has to be a card, pick a retailer you know will be around and where the person already shops.
- Skip third-party resellers and auction sites. The FTC warns cards sold there may be counterfeit or fraudulently obtained.
- Include the receipt, which the FTC suggests in case the card is lost or stolen.
None of this means gift cards are evil. A card to a coffee shop someone visits daily is a fine present. I just wish we’d stop pretending they’re the same as cash. Cash doesn’t depend on a store staying open.