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Beware of gift card and its hazards

2011-01-13

Gift cards are popular during festive season, and most people find this a convenient gifting option. However, they come with high fees, and other hazards that make them pretty worthless. It is worthwhile to check out the card`s features before using it. Most often, retailers as well as banks charge fees on the gift cards that remain unused. Gift cards also come with an expiry date, thus rendering them useless. Both the federal as well as state rules will offer consumers some protection from these provisions, but it is still better to be on the side of caution say the Consumers` Union.

The best thing to do with a gift card would be to spend it or use it right away. It has also been suggested that givers must consider all the options, while giving a gift card, and see if it is worthwhile to give that gift card to the person, or if giving cash or check is a much more worthwhile option instead of downing money in a gift card.

The fees that are charged on these gift cards can actually eat into the value of the card. These gift cards would become useless if the retailer decides to file for bankruptcy, and if the card holder does not make timely claims with the courts in case of bankruptcy.

As per the new rules, gift cards carry no expiry date for the first five years, but consumers have to be careful if they have used part of the card`s value on purchases.