What happens to my gift card if the retailer goes bankrupt?
You might have heard about the recent bankruptcies of Bombay, Sharper Image, and Linens-N-Things. Well, I hope you don’t have a gift card for one of them still sitting in your drawer. According to the recent issue of Money Magizine, you are not likely to get anything from them. It is possible that you could get a fraction of what it was worth, but not very likely.
They suggest that you start spending if you have a gift card for…
- Blockbuster
- Eddie Bauer
- Express
- Petco
- Toys R Us
Each one of these companies recently had their credit rating drop below investment grade. That is not necessarily an indication that they will go bankrupt, but definitely a cause for concern.
Personally, I often spend gift cards as soon as I get them, but they say that half of all Americans have an unused gift card laying around somewhere. It’s free money. Get spending!!
But I hate that store, I will never use it!
Can you imagine Paris Hilton trying to use a Home Depot gift card?
I can’t either. If you are in a similar bind with some of your unused gift cards, check out these sites. Each one allows you to sell the giftcard outright (at a discount) or trade it with other members.
{ 10 comments… read them below or add one }
Don’t forget http://www.giftcardbuyback.com. They seem to offer better prices for outright purchase of those unwanted cards. Way better than Swap-A-Gift.
I love toys R us. If you’re not wanting to use those I’d be willing to make an offer.
@Tim
thanks for sharing, I have never tried them, but if I get a bad one in the future I will give them a try…
If you don’t like the store, consider using the card to buy a gift for a friend who does.
I have often thought about how rich those companies get off of unspent balances on those cards. It’s like Richard Pryor in the Superman movie where he gleans 3 cents off of everyone’s paycheck in his company. Those little 50 cent balances must add up to a lot. I can see why Capitol One and VISA got in the business of gift cards.
One more reason for using cash. You get to keep the change!
@Ron
Good point…
@Cory
yep, I wonder how many millions of dollars those balances add up to each year…
I work for a company that manages and tracks gift cards, and I’ve been following gift card related issues on our blog. You’re exactly right, when companies file for BK, they may take their gift card programs with them. However, pay attention to the credit card gift cards. They have outrageous fees and they expire.
yes giftcardbuyback is also good one
Why use gift cards at all? You have to drive, wait in line and pay a fee to give someone what basically boils down to is cash. And it’s cash they can only spend at one place unless it’s a Visa, MC or Amex card. I stopped asking for and giving gift cards years ago after I found expired $50 and $25 cards from the Christmas before. A fresh bright new $20 or $50 bill makes a fantastic gift for kids and adults and I’ve never seen a disappointed face on a recipient.
At some point Nick, there is an advantage in using gift cards so many are using it now…