Beware of Gift Cards and Monthly Maintenance Fees
Gift Cards: The Use It Or Lose It Gift
If you plan on buying gift cards this holiday season, you’ll definitely want to do your homework first. Not all gift cards are created equal. If you don't want your gift recipient empty-handed when they go to use the gift card you give, there are some things you need to know.
Monthly Fees
Many retailers claim their gift cards never expire, and while this might be true, what they often don’t tell you is that the gift cards have a monthly maintenance fee if they’re not used for some period of time. In some cases, the monthly maintenance is applied retroactively back to the date the gift card was purchased.
Say No To Monthly Maintenance Fees
Look for gift cards that don’t charge a monthly maintenance fee. Even if the fee is only $1.00 a month, that fee will surely add up if your gift recipient is waiting a few months for a special occasion to redeem the gift card. You certainly don’t want your friend or family member penalized for waiting to redeem their gift.
A Step in the Right Direction
There are many gift cards that charge a monthly maintenance fee, so take advantage of them. The good news is that the Federal Trade Commission has recently tried to tackle monthly maintenance fees on gift cards.
Earlier this year, one target was Kmart, a retailer who retroactively charged a monthly maintenance fee if the gift card wasn’t used in two years. As a result of the FTC’s efforts, Kmart had to reimburse customers who provided gift card numbers and contact information or a receipt as proof of the gift card purchase.
One More Thing
If you do get a gift certificate or gift card that has an expiration date or charges a monthly fee after a set period of time, make sure you let your gift recipient know. Always include the receipt with the gift card so that your gift recipient has it just in case there is a problem.