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Play Your Gift Cards Wisely

With Christmas but a week away, it's the time of year when those ubiquitous plastic gift cards start to look awfully tempting to anyone with a few gifts yet to purchase.

This season will probably set a record in gift card purchases, with a whopping $24.8 billion predicted by the National Retail Federation. That's a third more than last year.

If you've haven't bought one, you've probably received one -- at least one. A recent Associated Press report says retailers profit from those millions of gift cards, lost in desk drawers and the bottoms of purses, that have gone unused. Consumer Reports has estimated that 19% of people who got gift cards last year didn't use them because they expired or got lost.

So, with that in mind, here are a few last-minute tips for buying and using gift cards:

  • Turn your unused gift cards into presents. If you have a few unused gift cards in your wallet, you might consider using them toward holiday gifts you're buying for others. After all, you haven't used them yet. You probably won't miss them. This also alleviates the terrible embarrassment of regifting an unworn sweater and realizing too late you forgot to take the gift card from your Aunt Sallie off the box.
  • Note the expiration date. Ask the sales clerk, or read the find print on the card, to find out how quickly your gift card will expire. Some may be as short as six months or a year. You might even make a note of the expiration date on the card or tag attached to the gift, just to make sure the recipient notices and uses the gift card in time.
  • While you're talking to the sales clerk, find out whether there are any fees attached to using the card or for reactivating it after it expires.
  • Dress up the card. Gift certificates are no longer the handwritten slips of paper they used to be. Most look more like fancy credit cards. Even so, package your card in a larger envelope or a box. The recipient will enjoy opening it, and it will be less apt to get lost in the sea of wrapping paper under the tree.
  • Tailor the card. As best you can, choose a gift card that allows the recipient to buy something they love. This can be done by picking a favorite store, a favorite restaurant, or favorite spa treatment. This not only shows some gifting thoughtfulness, but it may also encourage the recipient to use the card quickly.

If you receive a gift card, put it someplace where you'll see it often and have it on hand while you're out shopping. You may want to stash it in the slot in your wallet right next to your debit card or your most frequently used credit card.

Use the gift card as quickly as possible. If you're the type to forget details, write down the expiration date on a sticky note and attach it to the card.

When you go out to spend it, keep in mind that one of the reason retailers like gift cards is that many recipients buy more than their gift card allows and make up the difference with their own cash. This may be a great deal for someone spending carefully, allowing them to purchase something they otherwise couldn't afford. On the other hand, some shoppers may just not spend as carefully when they have free money in their pockets.

More Foolish holiday shopping advice:

For other spending and saving tips, please check out our personal finance newsletter service,Motley Fool GreenLight. You can try it out for free for 30 days, with no obligation to buy.

Fool contributor Mary Dalrymple welcomes your feedback.


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