The Gift Card: Get It Or Forget It?

   By drodriguez  Nov 28, 2008

Many of you may have received an email recently warning about the dangers of purchasing gift cards this holiday season.  The email includes a long list of popular stores that are said to be filing for bankruptcy soon.  According to reputable news sources, the email making its way from inbox to inbox contains a lot of false information.

While some stores included on the list have already closed like Bombay and Linens ?N Things, a lot of the other stores on the list are still in good shape and are not showing signs of financial struggle.

The email claims The Home Depot is closing stores due to hardships.  After ABC’s Boston affiliate contacted the store’s officials directly, they report that The Home Depot has “no plans to close additional stores” and will actually be opening a new location before Christmas.

Ann Taylor was also a store on the list of possible bankruptcies, citing that they would be closing down 117 stores.  Officials from Ann Taylor issued a statement calling the email “false and misleading”.  Though the company closed 117 stores a year ago due to underperformance, it continues to thrive almost 1,000 other locations.

The validity of the email has been disproved, but the message may still hold some importance. According to the Minneapolis Star Tribune if you receive a gift card this year you should try to redeem it as soon as possible.  David Brennan of the Institute for Retail Excellence reported to the Star Tribune about mall leases.  He said that since most of the store leases begin February 1st or August 1st you probably have all of January to redeem those cards without taking a risk.  Though he warns of the possibility that December 31st could be the last day some restaurants and small businesses will be open.

Having said that, it is always a safer bet to give cash rather than gift cards.  There is always a chance the cardholder could lose it or even forget about it.  And with more stores feeling the pain from the economic downturn, there is the possibility that the store could go under and you would be left with nothing more than a worthless plastic card.

What do you think of the recent news coming out about the safety of purchasing gift cards?

Will you still be purchasing gift cards this holiday season?

Make a Comment

szyhmkr by szyhmkr | WARSAW, IN
Dec 09, 2008

I am going to purchase gift cards for my niece and nephew this year. They are hard to buy for because I don't see them very often and really can't relate with their styles. I gave them a Visa card last year thinking they could use it at any store or just to get a drink at McDonalds. My sister said it was a pain in the butt to use because you had to know the amount you had on it to use it. So, I am going to go for a general mall gift card for my niece. That way she can buy from any of the stores in the mall. My nephew will be happy with Wal-Mart.

Lvn777 by Lvn777 | HIGH RIDGE, MO
Dec 09, 2008

u can NEVER go wrong with giving or receiving a gift card on joyous occasions. I prefer to give a mastercard or visa giftcared because u can't go wrong and likely never going to lose your money. If you buy from a department store than you'll never know if the next day they will file for bankruptcy (GOD FORBID), some of us just like to take that chance though.

ajie128 by ajie128 | Rosedale, NY
Dec 09, 2008

Gift cards are hard sometimes as they hold a balance after you use them for emaple I have one for $50 when I buy something that cost $49.82 I have this balance on a card of $0.18... Where am I going to spend that??? Cash is better to a certain extent but then it seems like you forgot the person and just dug in your pocket to give them a gift. so it is a catch 22

ace2ace by ace2ace | Roswell, GA
Dec 08, 2008

I usually give cards to a store like Target or Walmart because they carry such a wide variety of things. I know the card recipient can always find something to get there. While I like the idea of a universal card(Visa, etc.), I do NOT like the fact that I have to pay a fee just to purchase it.

mustangmomma by mustangmomma | Gravette, AR
Dec 08, 2008

I will give some gift cards again this year. But I will suggest that they be used rather quickly. Honestly, I knew the sales of gift cards were down this year, but didn't realize there was a big issue with them. Thanks for the update!

maddygirl by maddygirl | GILBERT, AZ
Dec 07, 2008

I love getting and giving gift cards and will use the grocery idea this year for presents. That is a really good idea!

kirangore by kirangore | New York, NY
Dec 07, 2008

i'm hesitant with any shopping /spending/ investing these days, it hasnt hit me yet, but the news keeps me on edge!

kirstensapphire by kirstensapphire | Fremont, CA
Dec 07, 2008

I like to get my gift cards online.

Sweethrt7873 by Sweethrt7873 | Hubert, NC
Dec 07, 2008

I will still get some and give some. But i will do research first. I think univeral gift cards are a good idea.

happybookworm by happybookworm | Orchard Park, NY
Dec 06, 2008

I have gotten burned in the past w/gift cards and gift certificates from stores that close. I do give grocery gift cards to the service people in our lives, bus drive, preschool assistants, etc. because who can't use groceries?

cveldman by cveldman | Holt, MI
Dec 05, 2008

I'm concerned about buying gift cards this year because we've had a couple stores in my area that pushed gift cards as an option, then merged with another company that didn't honor the cards. That's a nice way to get a windfall for a company, but it makes a lousy gift. I'm just going to be more cautious. Thanks for the update regarding these companies. So far the only one I've gotten is for a beauty salon where I know the owner well and I know she's doing well with no plans to close.

pennsgal by pennsgal | JOHNSTOWN, PA
Dec 05, 2008

I love giving ang getting gift cards - especially for those we gift that are hard to buy for. I think if you are going to give a gift card this season - do your homework and find out which stores will be closing - even if you have a gift card for that particular store, and it closes, perhaps it's possible to use the card at the stores online website? Thanks for the above article commenting on Home Depot, I had heard the rumor that it was closing, but couldn't find confirmation.

threadbeaur by threadbeaur | Shalimar, FL
Dec 05, 2008

I think gift cards are great. We like to purchase them for our out of town people. Keeps the shipping low! I am sure if you buy for a MAJOR store you will have time to use the gift cards, but if you are worried, the cards issued from major credit cards could be your best bet!

a2burns by a2burns | foxborough, MA
Dec 05, 2008

buy the american express , mastercard or visa one. they do not go out of business and can be used anywhere with no monthly fee eating away at the principal !!!!!!!!!!!!

Mtlgrl4evr by Mtlgrl4evr | DEBARY, FL
Dec 04, 2008

I give gift cards to certain family members every year. I haven't bought ONE this year. I'm worried about these problems happening.