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Many of us are wondering, can we just pick up a gift card and call it a day. Well, here to discuss all the pros and cons of giving gift cards this holiday season is Better's finance and career expert, Maribel Aber.

Transcript

Host: With the holidays in full swing, gift giving is all a lot of people can think about. It’s hard enough to find the right gift for your family members but what about other people, your children’s teachers, the mail carrier. A lot of people are wondering can I just get a gift card and call it a day? In today’s your money, here to discuss all the pros and cons of giving gift cards this holiday season is Better’s finance and Career expert, Maribel Aber, welcome back. Good to have you here. Maribel: Thank you. Host: Gift cards always a good option but now there’s research to back it up right? Maribel: There’s research. Let me tell you that the Tower Group reported that $88 billion was spent towards gift cards just last year and experts say, that’s just going to keep going up and why not because it’s easy to use. You can just like you said, get it to the mail carrier. But I don’t think people know that there are actually some drawbacks. Host: A lot of cons that go with it. With everything that has pro, there’s got to be some cons right? Maribel: There are so much so that actually Congress stepped in and they had the Federal Reserve enact this, it’s call the new gift card provision of the credit card accountability responsibility disclosure act of 2009. Okay what does that mean? It’s just that they’re trying to restrict some of the fees that the issuers are putting on gift cards and on gift certificates. You probably have-- Host: So it’s like credit cards, is they’re having to go get in and jump in and regulate that too. Maribel: Let me tell you that did you know that there are fees for bank monthly maintenance fees for something like balance inquiry? Yes, balance inquiry so transactions, if you want to put more money on the gift card, reloading, there are all kind of fees. So I bet you didn’t know that. Host: I did not know that. So there’s new laws that are going into effect when is this? Maribel: It’s August of 2010. So there’s you know but there are things that we can do right now to kind of get ahead of it. Host: You think you’re buying a $40.00 gift card, you’re thinking it’s going to worth $40.00 but after all that, it’s not right? Maribel: No, it’s not. Surprisingly, so the first thing, number one is it practical. Is this a gift that the gift recipient is going to enjoy? Do they actually do business there or not, otherwise, you might as well give them cash because you’re throwing away money. So when you’re going to buy the gift card, look for three things. Does it carry a fee? Number one. Number two, does it expire and number three, can it be replaced if it’s lost or stolen. Host: Which is very important too because it’s easy to lose those little cards too. Maribel: It’s so easy. Host: And a lot of people don’t really think about that but what if you do lose the card, then what happens? Maribel: If you lose a card, what I like to tell the recipient is go ahead and register the card immediately when you get it. I know we don’t think about it but when you register it, that’s a way the issuer can authenticate whether or not you’re the true owner of the gift card and then they can reissue it back. Host: But let’s say there’s an error with the transaction or you have other problems that come up with the card, is it as easy to fight those as it with a regular credit card? Maribel: The first thing you do is you always want to look at store policy. So that’s the first thing but if you want to lodge a complaint, you go directly back to the gift card issuer and there are three other resources. Number one, if it’s about a store gift card, you can always go to the Federal Trade Commission so people don’t know that. You can do that. That’s a source for you. If it’s a bank issued gift card, then you can go to your State Attorney General’s Office or the OCC. So good resources for you just to know about if you’re having trouble. Host: But Maribel, what happens, let’s say you have a gift card, you don’t get a chance to use it before it expires, it’s just gone? Maribel: Not necessarily, there are a couple of things. One the funds end up going to what’s called the unclaimed or abandoned state department and you can look to your national conference of state legislatures to figure out if there’s a state law that enables you to reclaim those funds. But the FTC always says go call the issuer because even though you think it’s expired, they may reissue it back. They may charge you a fee but at least it’s not gone into the wind. Host: Right, that’s really good to know and good information. Thank you so much Maribel, good to have you back and if you guys have any questions for Maribel you can always email her at askmaribel@bettertv.com.