Get gift card savvy

Nearly 88 percent of shoppers plan to buy two or more gift cards this holiday season, according to the National Retail Federation, and it’s not hard to figure out why. You can buy a gift card without fighting the crowds at the mall. You don’t have to worry about finding an appropriate gift for your 14-year-old nephew. And a gift card won’t land you in the doghouse, like those pants you gave your spouse last year that were three sizes too large.

Whatever your motives, it’s safe to say you don’t want your gift card to sit in a drawer and gather dust. Yet about 27 percent of adults who received gift cards during last year’s holiday season still hadn’t used them nearly a year later, according to an October survey by Consumer Reports. That was up from 19 percent the previous year.

That doesn’t mean you should abandon gift cards. Even some of the harshest critics of gift cards say they occasionally give them to finicky relatives and friends. But it does mean you should understand the terms and conditions of the cards you give.

Some tips:

Understand the pitfalls of “open-loop” gift cards. Gift cards from credit card issuers, such as American Express, Visa and MasterCard, can be used just about anywhere. But these cards also contain more fees and restrictions than other types of gift cards.

Gift cards from the major credit card issuers also start to lose value if the card isn’t used within a specific period, typically 366 days from the day they’re issued, says Ellen Cannon of After that date, the issuers deduct a monthly maintenance fee – usually $2 – which steadily reduces the purchasing value of the card. Some open-loop cards expire if they’re not used within two years.

Consider retail gift cards if you know the recipient’s tastes. If your Uncle Walter loves to hang out in bookstores, there’s a good chance he’ll appreciate a gift card from Borders or Barnes & Noble. And unlike open-loop cards, most retailers don’t charge fees for their cards.

Be creative. Some people hate going to the mall. Giving those folks a card that can be used only at a department store is like giving a kitten to someone who can’t stand cats.

Know your state laws. Several states have enacted laws targeted at expiration dates. To check out your own state’s laws, call your state’s consumer protection department.