Gift cards vs. Cash: At least one doesn’t have an expiration date

What’s wrong with cash? That’s the question Bill Cloud, a spokesman for the Governor’s Office of Consumer Affairs, posed during a discussion with an Atlanta Journal-Constitution reporter about gift cards.

He’s not the only one asking, particularly as the fine print about gift cards is being magnified under the microscope of new legislation passed by Congress this year to curtail the fees and charges often attached to what is supposed to be a gift.

This AJC story written by reporter Carrie Teegardin exposes what retailers aren’t inclined to tell you: If you don’t use the gift card, it could expire. If you wait too long to use it, it could be riddled with fees to re-activate it. That’s not the case across the board. Separating themselves from the bad news, some have eliminated fees and even expiration dates.

American Express, for instance, charges a fee to purchase the card, but has done away with all monthly fees on gift cards, including those already purchased.

Wachovia on the other hand touts a Visa gift card that costs $3.95 to purchase, but if it is unused within 12 months, Wachovia will deduct $2.50 every month from the card’s balance, the AJC reported. If the card still has value after its expiration date, Wachovia will charge $15 to issue a new one.

It’s easy to buy gift cards. Kroger sells them to numerous restaurants and retailers. It is even running a promotion — buy $100 worth of gift cards using your Kroger card, and get $10 off at checkout through Dec. 13.

So, what is wrong with cash? Is it any less personal than a gift card? It is every bit as flexible.

“A tank of gas I have to buy on the way home is not very memorable,” said Dan Horne, a marketing professor at Providence College on cash’s lack of appeal.

Consider this advice from consumer advocates before buying a gift card:

Consider cash: It never expires and is good everywhere. Who doesn’t like that?

Find out where the recipient likes to shop: Gift cards are often limited to one retailer. Either know what the recipient likes, or buy an all-purpose gift card, like a Visa or American Express card.

Check the fine print: Know what you’re buying, and let the recipient know as well. You may want to stay away from cards with costly fees and expiration dates. Georgia law requires that expiration dates be printed on gift cards or gift certificates. Dormancy fees must be either printed on the card or on a sticker affixed to it. If a card or gift certificate will expire or incur fees, don’t buy it.

Comparison shop: You’ll likely have to pay a purchase fee for a general purpose card, but avoid the gift cards that are riddled with all of the other potential expenses. Shop around for the best one.

Keep notes: Record the card or certificate number and other information so that you can request reissue if the card is lost.

Check service options: Make sure you can easily check the balance on your gift card or gift certificate.

Use it quickly: Why wait? If you’re given a gift card or certificate, go ahead and take advantage of it.

Is it cheesy to give cash? Does it mean as much to get cash as it does a gift card or gift certificate? Have you ever been burned by a gift card?

Follow me on Twitter @atlbargains and on Facebook at AJC Atlanta Bargain Hunter

15 comments Add your comment

Scott

December 7th, 2009
9:26 am

In a fair debate it wouldn’t even be close. Cash would be the overwhelming winner. No fees, valid everywhere, never expires, no unused balances, not limited to a single location (that may go out of business). Cash only suffers because no one touts its advantages. Gift cards are pushed by mega-marketeers in every industry – banks, restaurants, retailers, credit card companies, etc. But who stands up for cash? The Treasury? The Mint? The Fed?

I will! Check out my product, the Original Gift Card at http://www.orignalgiftcard.com It’s a cool little cash carrier that makes giving and receiving cash very cool. It comes in 7 colors and includes a sticker sheet to personalize the card for any season or reason (Christmas, birthdays, graduation, baby showers, etc) It’s exactly the same size as plastic gift cards so it fits easily in any wallet.

Cash is, after all, the “always-in-style, freedom-to-choose, never-expiring, always-know-the-balance, perfect-fit better alternative to the gift card”

Happy Holidays to all!

Scott

mystery poster

December 7th, 2009
10:57 am

I have several people on my Christmas list that I give cash to, but I always wrap it up in a little gift item such as some socks or a candle or something.

Besides the reasons listed in the article, another reason I don’t like gift cards is the environmental unfriendliness of them. What happens to the plastic when you’re done with the card?

UGA Shopper

December 7th, 2009
12:14 pm

I reload cards with more $$. Some of them I have had 4 years, so I don’t throw away the plastic card after I use it. They are nice for travel when you do not want to carry cash.

Jed

December 7th, 2009
12:20 pm

Every year, my mom gives me a Visa gift card. I hate the thing, mainly because I know she had to pay a fee just to get the danged thing, not to mention all the fine print I have to deal with. Gift cards are a PAIN in the arse.
So this year I had an even better idea: I mentioned just writing a check but placing it in a really nice card with a special message. I mean, people do it at weddings, so why not for Christmas?

Holiday Cheer

December 7th, 2009
1:22 pm

My 2 cents: if you get a gift card use it right or way or with a a few months. The balance should be deducted if you hang on to it for more than a year. B/ca if you do that you apparantly didn’t need it or cash.

Holiday Cheer

December 7th, 2009
1:23 pm

oops for the typos…..corrections use it ‘right a way’ or ‘witin in a few’

Debbie

December 7th, 2009
2:54 pm

I have been thinking of giving gift cards but now I am think good old cash will work! Thanks for the info.

Ole Guy

December 7th, 2009
4:04 pm

Like many good things gone awry, these gift cards, once great marketing tools, are now nothing more than plastic fools’gold. There is absolutely no reason, short of pure greed, that retailers would impose these charges. They are, in no way, incurring an expense for unused cards…in fact, they are reaping the reward of double indemnity…they have the cash AND the inventory of the unsold item which is available for another sale.

I have absolutely no sympathy for struggling retailers who have, by their own greed, brought their own problems upon themselves.

Rita

December 7th, 2009
4:38 pm

Giving cash is tacky and shows you put absolutely no thought into the “gift”. If you can do nothing better than give cash, why bother! No one wants your “bonus” socks & candles either – please!

Purchasing a gift card that caters to the likes and interests of the receiver at the least shows you put some thought into the “gift”. It find it utterly amazing what an ungraceful & ungreatful society we currently live in.

Gift cards are not that hard to figure out; but yet again, if the education level of your friends and family dicate “cash only’, buy all means give cash! How gauche of the recipient and the receiver!

Ole Guy

December 7th, 2009
5:07 pm

Good point, Rita. Our society has evolved into a “kash is king” mentality, with all the impersonal, arms length” relationships we now see.

Shannon, M.Div.

December 7th, 2009
6:09 pm

I prefer a gift card to cash.
1) Make sure it’s not a gift card with fees. Most store gift cards have no fees, but it’s good to check.
2) Forget those “VISA” or AmEx cards. If you’re doing that, give cash.
3) A gift card to a kid or teen allows you to gently direct the gift while still giving them options (i.e., to Barnes and Noble if you want them to have books or music, or to a clothing store if you want them to have clothing).
4) A gift card to an adult says “Spend this on yourself, not on necessities.” Cash will go to the usual things–bills, gas, etc… but a gift card isn’t cash, and therefore there’s no guilt associated with spending it as intended.

My family is crazy-blessed this year. My husband and I have no kids, we both work (well, I’m in graduate school, but do I get paid a bit), and he just got a nice bonus check on top of his regular pay. For the two of it, it’s “recession? What recession?” But many of our family members are not so fortunate. We send them money and needed items frequently, but we want them to have an actual gift at Christmas. Giving them a gift card to Outback or some other “frivolous” place allows us to make sure they celebrate, and we feel comfortable doing that since we also make sure they don’t do without necessities. Since my husband’s brother-in-law has an unfortunate habit of taking any money he can find and spending it on guns or truck “enhancements” (even if his kids need clothes), a gift card is a WAY better gift for them than cash.

Mary Civille

December 7th, 2009
6:11 pm

Cash is the best way to go. Cash is never, ever tacky, Rita. Engraved portraits of dead presidents and others (Hamilton, Franklin) on 100% cotton stock are sexy; “bonus” socks and candles are not. If all else fails, try homemade cookies or candy. “Buy all means”?

Becky

December 8th, 2009
4:52 pm

Rita, please take a pill and relax..Giving money isn’t tacky..We as a group at work have given cash to the owner of the company before..He loves it..Oh and by the way, he has a college degree..

Most everyone has anything and everything that they want, so if someone gives me cash, I’m fine with that..Some people just want to make others think that they are so hoity toity..

Ted Striker

December 8th, 2009
10:06 pm

Rita @ 4:38 p.m. — From the tone of your post, it seems odd for you to be accusing a gift giver of a lack of thoughtfulness, a lack of grace, and being ungrateful. Maybe you need to examine your own attitude.

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