One of the easiest things to do for gifts in today’s world is to pick up a gift card of some type that’s set for a particular denomination and use it as a convenient way to give someone money as a present. While it is convenient, it’s not always the best way to give someone money; let’s take a look at this.

A surprise gift
Kristina Alexanderson via Compfight

The good part of it is the convenience and relatively low cost. The fee is dependent upon how much you’re looking to give someone, so if you’re looking to give a $25 gift card to a store or just a general credit card vendor it’s usually around $3.99 at most. They’re easy to put into an envelope or a card and off it goes, no wrapping and the person can use it however they wish.

The bad part about it are those other fees that we don’t think about because we’re not the ones using it. If you give someone a $25 card they’ll probably only get to use $21 of it, and that’s if they spend it all at one time. Some cards will charge a fee every time it’s used, which to me isn’t fair but for a low dollar card, it’s even worse. Say someone wanted to use it to buy coffee a few times; that’ll probably pretty much max out the card with the fees.

Another thing that sometimes has to occur is the person receiving the card might have to call and activate it first. That’s not such a big deal but there are some cards where just activating it adds a fee; what the hey? I’m thinking that’s not fair, and that’s usually for store cards or some online sites.

The final thing are those cards where the balance left might only be $7.50 or less, but no matter what it is the store won’t give you cash for the balance. I can see that for online stores but at a physical location the company would be getting the money back anyway, and truthfully has already been paid for it, so why is that an issue?

My rule of thumb? If I’m giving at least $50 or more I’ll go ahead and buy a Visa or Mastercard gift card. I never buy store cards because truthfully I have no idea what stores other people might like. With a substantial amount the person will still be able to get a lot of stuff, even if there’s a small fee.

For anything less than that I’ll take my chances and send actual cash. If it’s surrounded by a card there’s little chance that someone else will know cash is in there and that way they’ll get the full value of what you wanted them to have.

In any case, if you’re thinking about buying someone a gift card at least read what the instructions say to see if you’re really giving what you hope you are.

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