Gift Cards Are Better This Year: 3 Tips to Buy Them for Less

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Thanks to the CARD Act, Gift Cards have fewer fees less fine print. And thanks to these tips, you won't have to pay face value when you buy one.

Gift cards are making a comeback after three years of sluggish sales – and the federal government might be the reason.

A new survey from research firm TowerGroup predicts that spending on gift cards for the 2010 holiday shopping season will increase for the first time since 2007, reaching $91 billion in sales. And in two years, that should reach an amazing $100 billion.

Why the jump when we’re still in the grip of a recession? Because of the CARD Act, says TowerGroup senior research director of bank cards Brian Riley.

“The new protections afforded to consumers under Title IV of the CARD Act have greatly increased consumers’ willingness to use gift cards as a form of gift giving,” Riley says.

When it went into full effect this summer, the CARD Act got a lot of attention for how it protected consumers from credit card tricks like skyrocketing interest rates and hidden fees. But the act also contained provisions about gift cards – placing limits on expiration dates and banning “inactivity fees,” for instance. For more about what the CARD Act did to improve gift cards, see Tips for Buying and Using Gift Cards.

Those clear new rules have also led to a spike in gift-card giving among employers.

“Gift cards are the most commonly cited gift for employees (40 percent),” says a new survey from Successful Promotions magazine, “followed by cash bonuses (32 percent), apparel (24 percent), food or beverages (24 percent) and calendars (18 percent).”

How to get your gift cards for less

You should never pay face value for a gift card. Here are three ways to get them for less…

1. Auction sites: You’ll find discounted gift cards at eBay and other auction sites, but because you have to be extra-careful when buying this way, you may have to pay in time what you save in money.  You’ve got to check the seller’s rating, for example, as well as verifying details like the expiration date. And don’t forget to see how much the shipping charge is. As for how much you’ll get off? You may get lucky, but I was just on eBay and saw discounts from face value of 10% or less – not a big deal. Also be aware that some sellers are getting cute by offering a card with, say, $100 face value for a “buy-it-now” price of $1 – but the shipping is $94.

The deals at auction sites will probably get a lot better if you wait until the day after Christmas.

2. Specialty Sites: Sites like Giftcards.com and Certificateswap.com offer discounted cards, and they’re safer than auction sites because the value of the card is secured by the seller’s credit card. I went to Giftcards.com and the discounts were 10 – 20 percent, but the pickings were slim. Restaurant.com and Citydeals.com offer discounted coupons on eating out and movies.

3. Warehouse Stores: If you’re a member of Costco, Sam’s Club or BJs, you might find discounted gift cards there. Again, 10 – 20 percent off face value. Of course, you won’t find every card, but you might find one you like. Costco recently had a $90 iTunes card for $75.

And if you find an unwanted gift card in your stocking this year, check out our story Get the Most From Your Unwanted Gift Cards.

Stacy Johnson

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