Gift cards are a popular last-minute holiday present. But make the wrong choice this year, and you could be sorry.
Many retailers and restaurants are in deep financial trouble as a result of the coronavirus pandemic. Some — including J.C. Penney, J.Crew and Neiman Marcus — have even filed for bankruptcy protection. And although most of these businesses are likely to survive, some might not.
That means you must shop carefully when choosing gift cards, lest you or a loved one end up with a worthless piece of plastic.
One simple way to protect yourself — and your gift recipient — is to do a web search before you buy. Type in the retailer or restaurant in question, and do a search. It can help to refine your search to the “news” category.
If you see any hint of trouble, reconsider the purchase. If you decide to buy the card anyway, it might help to encourage the recipient to use the gift card promptly. As the U.S. PIRG Education Fund explains in a recent blog post:
“When a merchant declares bankruptcy, there’s a long line of people who get first dibs on any assets, such as the company’s lenders and landlords. People who hold gift cards are near the back of the line.”
Finding the right gift card
Fortunately, you should have no trouble finding an alternative gift card choice at a retailer that is in solid financial shape.
Many restaurants also are offering great deals on gift cards right now. At these eateries, buying a gift card over the next week or two will get you a bonus gift card for free.
For more, check out “24 Restaurants Offering Free Gift Cards in December.”
As we noted recently, WalletHub singled out some gift cards that are especially highly regarded. You can learn more about them in “The 8 Best Gift Cards to Give in 2020.”
Finally, don’t forget that you can save a few bucks on your gift card purchases by shopping at a gift card marketplace such as Raise. For more, read “How Unwanted Gift Cards Save Me Hundreds of Dollars a Year.”