A Poor Delivery: Post Office Gift Cards Not a Good Buy

Money Talks News

Many post offices already have small gift shops, and the United States Postal Service long ago expanded its product line-up way beyond collectible stamps – you can now buy watches for $86 and Frank Sinatra CDs for $17.

But those items at least had some connection to the USPS: The watch in question features a stamp design on its face, and Sinatra once graced a stamp himself. There’s no such connection when it comes to post offices’ latest merchandising plan: selling gift cards. And unlike the cost of a stamp, they don’t come cheap.

Starting in May, about 2,000 post offices will embark on a two-year experiment to sell cards in amounts both fixed ($25 and $40) and variable ($26 to $100). If it makes money, expect another 3,000 post offices to join in by October – just in time for the holiday season.

Issued by companies like American Express, Discover, MasterCard, and Visa, these will be “open-loop” cards ranging from $25 to $100. That means they’re good at any participating merchants. (The post office says it might later test “closed-loop” cards, which are only good at one merchant.)

But unlike the price of a stamp, the Post Office is tacking on extra fees. For the “fixed-rate” cards (those in denominations in $25 and $50) they’ll add an extra $4.95 fee. And the “variable-rate” cards (ranging from $26 to $100) will set you back an additional $5.95.

While it may be tempting to pick up a gift card while waiting in those long lines at the post office, here’s some money-saving advice: Wait till you get home and buy them online. Here are 3 Tips to Buy Gift Cards for Less.

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