Not sure what gift to get? Consider this advice from consumer advocates before buying a gift card:
Consider cash: Dress it up in a fancy envelope. It’s good anywhere and never expires.
Find out where the recipient likes to shop: Gift cards often go unused because they are limited to one retailer. A teen’s favorite store from last year may be his least favorite this year.
Check the fine print: Before buying any card, determine whether monthly fees will apply if the card isn’t used immediately. Also check expiration dates. Georgia law requires that expiration dates be printed on gift cards or gift certificates. Dormancy fees must be either printed on the card or on a sticker affixed to it. If a card or gift certificate will expire or will incur fees, don’t buy it.
Comparison shop: American Express broke from the pack of credit card issuers when it stopped all monthly fees on its gift cards. If you are buying a general purpose gift card issued by a credit card company, opt for one that will not expire and will not incur fees other than the purchase fee.
Keep notes: Record the card or certificate number and other information so that you can request reissue if a card is lost.
Check service options: Make sure the card or certificate offers an easy and free way to check the balance.
Use it quickly: If someone gives you a card or certificate, use it quickly to avoid losing it, forgetting about it or risking a shaky retailer going out of business.
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The new rules
The Credit Card Accountability Responsibility and Disclosure Act of 2009 contains provisions related to gift cards. The Federal Reserve will takes comments until Dec. 21 on its proposed rules to enforce the new law. The rules would:
● Ban dormancy, inactivity and service fees on gift cards (or gift certificates) unless a card has been unused for at least a year.
● Allow only one service fee per month on dormant cards.
● Require clear and conspicuous disclosures about fees.
● Prohibit expiration dates less than five years after a card or certificate is issued.
To comment on the rules, go to: www.federalreserve.gov. Click on FOIA at the bottom of the page. Select “Proposals for Comment.” Look for the comment option related to “Regulation E.”
