Tricks, traps of holiday gift cards: Worst hidden pitfalls

Although gift givers may love the convenience of gift cards, they often come with hidden fees and other surprises.

By Jeff Bertolucci, PC World |  Business, retail

For last-minute holiday shoppers, gift cards make convenient (if impersonal) presents. Retailers also love gift cards, which recipients often lose or forget to use. According to a recent Consumer Reports survey, 27% of gift card recipients this year haven't redeemed one or more of their cards, up from 19% a year ago. And financial analyst firm TowerGroup estimates that consumers forfeited $8 billion last year due to lost, expired, or unredeemed gift cards.

Gift cards may come with sneaky fees, as well, and givers and recipients alike must know their rights to avoid being ripped off.

Major retailers such as Best Buy, Target, and Walmart typically sell house-brand cards at face value. A $50 Walmart Gift Card, for instance, costs $50 to buy and never expires. If you purchase the card online, Walmart offers free shipping via the U.S. Postal Service (seven- to ten-day delivery time), as well as faster and pricier options, including one-day shipping for $15.

Attack of the Killer Fees

American Express, MasterCard, and Visa prepaid gift cards are often laden with additional charges., for instance, charges a $2.95 fee for cards ranging in value from $20 to $74.99, plus an additional 44 cents for shipping via USPS; the actual cost of a $50 Visa gift card, for instance, winds up being a little over $53. The site also charges a $4.95 fee for a Visa "virtual" gift card, which transmits to the recipient via e-mail. The total cost of a $50 virtual card is therefore almost $55.'s fee schedule reveals a few stealth charges that affect recipients, as well. Failing to use a card in 12 months, for instance, invokes a charge of $4.95 per month. And if you call one of's support reps to check your card balance, you'll pay $1. (You can check your balance online for free, however.)

Originally published on PC World |  Click here to read the original story.
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