5 Things You Didn't Know About Gift Cards

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mastercard branded gift card
You may have one or dozens of them in your wallet. Gift Cards are possibly the number one gift every holiday season. And they can be fun to have, giving the recipient a wealth of spending options. When it comes to branded gift cards (this article does not pertain to store gift cards), there are several things you need to know to get the most out of your cards.


It might seem obvious, but it's important to use your gift cards sooner rather than later

The gift card trade makes a phenomenal amount of money on gift cards that were never used. While you might be thinking of saving yours for that special purpose, if you misplace it or worse, lose it, that’s money gone forever and into the pockets of the gift card company as profit.

If you receive a Gift Card as a reward (example: for switching Cable or Cell Phone providers), these cards often decrease in value over time, as the card issuer charges a periodic fee (sometimes monthly) which is deducted from the value of the card. Over an extended period of time, you might be surprised to learn that there is little or no balance left on a card you never used!

Keep track of your balance

If you forget what you last used a card for, refer to the back of the card for a website and a phone number that can be used to check your balance.

And make sure you use your remaining balance, even if it is only a few dollars. That's your money!  If you don't, the gift card company gets to keep it as additional profit!

Make sure you’re not tendering the card for a purchase that exceeds the total available funds

If you’ve ever tried to use a gift card with available funds on it and it was declined, the single most common reason is that the transaction amount exceeds the amount available on the card. In this case, the card will always be declined. 

When this happens, tell the cashier you want to split the payment – charging the exact amount available on the gift card first, then the remaining amount in another form of payment.

It's a bit trickier when you're shopping online. Here you have to make sure you're not using the card for more than the transaction amount (including taxes and shipping.)

Hold on to that card even after all funds have been exhausted

If you decide to return an item, the store may only be able to provide a refund to the original form of payment, which is the gift card you may have been quick to throw away. If you no longer have the card, then the money is gone!

If you already threw the card away, ask the store if you can do an exchange, or a store credit that can be used at a later time.

Avoid using gift cards at places that are likely to authorize a set amount on the card

Gas stations are notorious for this. As they don’t know how much gas you’re going to buy, they will request an authorization for an amount that may be higher than you’re actually going to spend. That authorization may take several days to clear, leaving your card’s balance in limbo.

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