Seven words you never want to hear at Christmas: “WHAT!!! YOU GOT ME A GIFT CARD?!?!?!?” On the other hand, if someone really wants a gift card, why fight the crowds and spend hours looking for the perfect gift? It’s easy and it will be easier to have a debt free Christmas if you know exactly what you are going to spend on gift cards. The fact is, some people will accept a gift card as the perfect gift and others will consider it a poor excuse for a Christmas present. So, do you think gift card is the “perfect gift or a lazy excuse?
Photo by arvindgrover via Flickr
A Guide to Christmas Gift Card Giving
Is a gift card a good idea? This can only be answered by the intended recipient. Since you can’t really ask them (or can you?) you’ll need to be the judge. Here are some general guidelines to help in the process.
History: In a casual conversation ask them what some of their favorite gifts have been from Christmases past. You might even ask them if they have any gift giving pet peeves. Somewhere in the conversation they may make a mention about gift cards – pay attention.
Spenders: Other than the fact that you are fueling their addiction — gift cards are generally good ideas for spenders. Spender will (1) have an item in mind that they want to buy, and (2) will spend every last penny from the card.
Savers: Savers often don’t like gift cards. Savers will do the same thing with the gift card as they do with cash — save it. These are the individuals who six months after Christmas are still carrying around the card.
Age: In general, younger people tend to be happier with gift cards than older people.
Thoughtfulness: As the old adage goes –- it is the thought that counts. If a gift card is purchased to excuse you from thinking, it won’t be received well. My wife, for example, always knows if I’m trying to get out of the hard work of choosing the perfect gift. As a result, I’ve stuck with making my own homemade Christmas gifts. If you are going to go out looking for gifts, follow these 9 smart holiday shopping tips.
Know the recipient: This guideline applies to all gifts. So, for example, you may not want to give an anti credit card person a $100 American Express gift card. The last thing he wants anyone to do is to give a person a ‘gift’ that supports an industry they loathe. I, on the other hand, think there are advantages to credit cards (as compared to debit cards) so you are more than welcome to give me an AMEX gift card.
Don’t use it as a lazy last minute idea: I’m telling you, some people can just sense this stuff. It’s like you’re sweating laziness and they can smell it. Buy a gift card when you think it is what the recipient would most enjoy, not because you want a lazy man’s exemption from Christmas shopping. Why not try these money saving tips for online shopping if you want to buy a gift but don’t want to go to the mall.
What can you do with unwanted gift cards?
1) Host a post-Christmas gift card exchange party.
While you might not have any reason to spend $50 at Starbucks, your friend might love Starbucks. They may have received a $50 gift card for Olive Garden. Simply exchange your cards dollar for dollar. Everyone brings unwanted gift cards. This is yet another way you can save money by forming a frugal community.
2) Host a gift card auction with some friends.
The approach is simple. You bring your unwanted gift cards and your friends bid on how much they want to buy it for. You get money. No one gets a commission. You leave happy. Would you rather have $45 or a $50 Red Lobster gift card when you are allergic to seafood? Take the $45 cash and be done with it.
3) Sell them on Craigslist or eBay.
Craigslist involves a little more hassle, but for larger gift cards it may be a good idea. On eBay you will lose more on fees and might not get as much for the card, but if you are just wanting to unload the card, try eBay.
4) Exchange online – use a gift card swap service.
Here is a great guide on buying and selling gift cards
Yes, there some members of our society who have strong feelings about re-gifting. I am not one of them. If the recipient of the gift is likely to enjoy the gift card, then by all means pass it along.
What type of gift cards are best?
Contrary to popular opinion, I think specific store cards are better than the more generic prepaid debit cards (like MasterCard, Visa, and American Express). My reasoning is simple — the more generic, the less thought is required. To give an American Express gift card says, “I don’t know you — what you like or enjoy. So I hope this shows you I have no idea what you like”. At least a store specific card communicates, “I know you love Amazon and I wanted to give you the gift of one of your favorite shopping destinations”.
What fees are associated with Gift Cards?
Generally, you will pay less fees with a store specific brand gift card. It is possible, however, that after some period of time the card holder will be charged a monthly fee.
Non-store specific cards have more reason to charge because they must generate business. Typically there is either a fee to purchase the card, use the card, or keep the card. There may be a flat fee purchase price. There may be a monthly usage fee. There may be a charge for the percentage of dollars spent.
When buying a gift card always ask (and read) about the fee structure.
How do you determine if gift cards are a good idea? What about you? Do you like receiving gift cards for Christmas?
Craig Ford is a fulltime missionary in Papua New Guinea who writes Money Help For Christians and Help Me Travel Cheap, a frugal family travel blog. He is the author of Money Wisdom From Proverbs, has a Masters of Divinity degree, and (most importantly) eats homemade pizza with his family every Friday night.