Got a bunch of gift cards this Christmas? You’d best cash them quickly
If Christmas this year has left you with a neat stack of little plastic gift cards, and every intention of cashing them in, the advice from consumer groups is simple: Use them now or you probably won’t.
Over the past 12 months, Australians are estimated to have lost $148 million in unused gift cards, and research by finder.com.au has found one in seven gift cards expired with leftover funds in the past year.
Ian Jarratt from Queensland Consumers Association said there are three reasons to use your gift cards as soon as possible:
- They’re easy to lose and easy to forget about;
- If you get a gift card with a company and it’s linked to that particular shop, and that businesses goes into liquidation, you become an unsecured creditor;
- If there’s a problem with the product and you cannot solve the dispute with the retailer, you might qualify for a chargeback on Visa and Mastercard — but this too has a time limit.
And if you don’t get to using it right away?
“If you don’t cash it in right away, photograph it and write a record of where you’ve kept it,” Mr Jarratt said.
Weren’t there new laws to stop this very thing from happening?
You wouldn’t be remiss if you thought there were new laws in place that extended gift card expiry dates.
In October the Morrison Government passed laws through Parliament ensuring all gift cards are valid for at least three years.
The new laws also require the expiry date to be clearly disclosed on the card itself and ban post-supply fees.
The only problem is, the laws don’t kick in until November 1, 2019, and the laws will only apply to cards supplied on or after that date in order to give businesses enough time to adapt to the reforms.
Just because laws have been passed, it doesn’t mean they’re actually in place. (ABC News: Taryn Southcombe)
The rules are in place at state level in New South Wales and South Australia — NSW’s laws came into effect in March this year and SA’s from December 10.
While many national retailers are complying with NSW and SA laws, it’s important not to be complacent, as businesses in the remaining states and territories aren’t yet legally required to comply for almost a year.
Now that you’ve been warned, you might want to come up with a better system for making sure you remember to use up gift cards, which brings us to the next point…
Your tips for remembering to cash in gift cards
We asked our Facebook Messenger audience whether they had a system in place to prevent gift cards from going unused.
Some included serious organisation:
I put the card expiry in my Google calendar with it recurring monthly so I remember to use the card.
I keep my gift cards in the same part of my wallet as my bank card. It keeps the gift card top of mind to remind me to use it before it expires.
Others encouraged spending on the mundane:
I don’t save them for “something special”, I just use them on groceries or fuel. I love going to the cinema, so I always use them up.
Petrol, groceries, alcohol, iTunes or Netflix credit. As long as it’s something you would have bought anyway within that year, this method will offset that expense, which effectively turns the gift card money back into real money in your bank account.
And one recommended a collaborative approach:
I give my gift cards to my mum and she uses them then transfers me the worth of the card.
You also told us about other ways you’d lost money with gift cards
Like hidden fees:
I get gift cards for Christmas every year and usually wait around six months or so to use them. I went to use a $50 gift card recently and after it said insufficient funds at the checkout I logged on to see the balance was now down to $37.50 as there’s apparently a recurring $2.50 ‘account maintenance fee’ … I lost $12.50 worth of value because I took my time using the card. It’s made me think twice about getting gift cards for my family this year.
Or a sudden rebranding:
A few years ago, Dad gave me a gift card for a local camping store for Christmas. In January, the store rebranded under new ownership, and when I tried to use my gift card in February, they wouldn’t accept it because it had the old branding on it. The card was in-date, and was purchased at that exact store, but they just refused. They would have known the rebrand was coming when my Dad bought the card in December — they should have told him then, because the gift was completely worthless.
Even jurisdictional restrictions:
$100 in iTunes vouchers sent from NZ for Christmas presents. Can’t redeem them on accounts in Australia!!
And being careful about gift cards for things that require bookings:
We bought a gift card for a one-on-one platypus experience through red balloon a while ago and when I realised it had a month left I went to book in to the experience. I was told they were booked out for months and that the voucher had to be in date not just at the time of booking, but at the time of the actual event. So I realistically had to book in the first couple of months or I was going to lose it.
What to remember when buying someone a gift card
But these issues with gift cards don’t mean that they’re not a great gift idea.
Mr Jarratt points out that if you are buying gift cards, buy from a retailer that is likely to be useful to the receiver and that come with fair terms and conditions. It’s also handy to check whether or not the gift card can be redeemed online.
Finally, consider whether cash is a better option because it doesn’t expire or come with any catch.