Smashing Down The Rules!
By Will from Holland
Get these two scenarios:
You got a sweet gift card for $50 for your birthday from your friends. You run to the store to buy your favorite video game that goes for $49.95! But, the store charges you a $10 activation fee... Bummer!
Because you were so irritated with the gift card from the previous scenario, you chucked it in your desk drawer and completely forgot to use it until now, 6 months later. You run to the game shop again to buy the (now) discounted game only to find out your card has expired... Bummer!
No more of that!
With new gift card regulations* in place, you're better protected:
- Limited Expiration Dates: your card can't expire for 5 years, and any funds added later will not expire for an additional 5 years.
- Limited Fees: generally, fees can only be charged if you haven't used your card for a year. If you are charged that fee, you can be charged only one fee per month.
Sounds better, ey? It is. But you can still get stiffed. You can still be charged a fee to purchase a gift card or to replace a lost or stolen gift card, and there is no limit on what the fee can be.
The new regulations do not apply to cards obtained through promotions and/or giveaways. Nor do they apply for pre-paid cards. Fees may still apply.
A tip! Duh! Be sure to read the gift card regulations! And if you give a gift card, make sure you also give the recipient the gift card regulations. If you receive a card and no regulations are included, head online to read up on that card's rules and regulations.
Gift cards were designed by companies to make money, not as a favor to consumers. They still have exceptions that can cost you or the recipient money. But do your homework, and a gift card can be a smart and flexible gift for anyone.
Need more info? Check out the FederalReserve.gov website. Or you can browse our website for related articles! There are plenty more good tips where these came from.
See you next time!
* The new law applies to both store gift cards and bank-issued gift cards.