Gift cards are one of the most popular holiday gifts, and one of the easiest to lose money on. Some get lost, some get drained by scammers before they’re used, and some just sit in a drawer. Here’s how to buy them smartly and make sure the money actually gets spent.
The Federal Rules That Protect You
- Five years minimum. Under federal rules, a gift card can’t be sold with an expiration date less than five years away.
- No inactivity fees in the first year. Fees for not using the card can’t start during the first 12 months. After that, some cards can charge them, so read the fine print.
- Fees must be disclosed. Any fees should be listed on or with the card.
Some states have even stronger protections, so check your state’s rules if a card has expired or lost value.
Store Cards vs. Visa or Mastercard Gift Cards
- Store gift cards work only at one retailer. They usually have no purchase fee, but if the store closes, the card may become worthless.
- Network cards (Visa, Mastercard, American Express, Discover) work almost anywhere, but often come with a purchase fee of a few dollars.
Check the Card Before You Buy
Scammers sometimes tamper with cards on store racks, copy the numbers, and wait for someone to load money onto them. Before you buy:
- Make sure the protective sticker over the PIN is intact and the packaging isn’t torn or resealed.
- Take a photo of the card and your receipt. You may need both if something goes wrong.
- Buy cards kept behind the counter when possible.
The Big Warning: Gift Cards Are for Gifts, Not Payments
No real government agency, utility company, tech support team or legitimate business will ever ask you to pay with a gift card. If someone tells you to buy gift cards and read them the numbers, it’s a scam, every time. Scammers often pretend to be the IRS, a family member in trouble, or your bank, and they rush you so you don’t have time to think.
If You Paid a Scammer With a Gift Card
- Call the company that issued the card right away, using the phone number on its official website.
- Keep the card and receipt.
- Ask for your money back. Some companies can freeze funds if you act fast.
- Report it at ReportFraud.ftc.gov.
Make Sure the Card Gets Used
- Register the card with the issuer if you can, so it may be replaced if lost.
- Keep the receipt with the card when you give it.
- Use it soon. The longer a card sits, the more likely it gets lost or forgotten.
- Treat it like cash. A lost gift card often can’t be replaced.
The Bottom Line
Gift cards are a practical gift when you buy them carefully and use them promptly. Inspect the card, keep the receipt, and remember: anyone demanding payment by gift card is a scammer.