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How to Prevent Gift-Card Problems

Gift cards can be great to receive but they may also present you with a host of unexpected problems. If you received gift cards over the holidays, here are some steps you can take to minimize potential hassles.

Use your gift cards quickly. "The biggest mistake gift-card recipients make is to put their cards in a drawer and forget about them," says Trae Bodge, who runs the shopping advice website True Trae. Almost $1 billion in gift-card value wasn't spent in 2015, according to the latest data from the market research firm CEB. A solution? Bodge says to keep your gift cards in your wallet or purse so that if you happen to be in the right store and see something you want, you'll have quick and easy access to them.

Record and register the card numbers. The Federal Trade Commission warns that some issuers won't replace lost or stolen gift cards. But others will as long as you report the loss before someone else uses the money loaded onto the card.

If the issuer of your gift card has a replacement policy, make sure you register your card on its website. Alternatively, ensure that you can provide the card issuer with the card number or even a purchase receipt. That way, if you need to, you'll have a better chance of getting a new card.

If possible, change the gift card's security code. A thief could drain the value of the card before you use it, though this is rare.

You may be able protect yourself from this possibility by quickly changing the security code on the card. Not all card issuers allow you to do this, but some do offer the option when you register your card online.

Spend all the money loaded onto the card. One of the most annoying things about using a gift card is that after you use it to make a purchase, you may be left with a small balance. Using it to buy something worth, say, $2 may not be easy to do depending on the store.

You can avoid this gift-card problem by requesting a "split tender" payment the next time you shop at a retailer, says Christina Tetreault, a staff attorney at Consumer Reports. That means you should first pay with the gift card to use up the balance and then pay the rest using cash, a credit card, or a debit card.

In some states, this problem doesn't exist. In California, for example, you can get back up to $10 in cash, and in Colorado you can get back up to $5. Find your state's gift-card laws at the National Conference of State Legislatures' website.

If you can't use your gift card, give it to someone else. If you receive a gift card for a merchant or restaurant that's inconvenient or just not your favorite, consider giving it to someone who would be able to use it. It saves you from having to go out and buy something else, and it could be a better option than trying to cash it in at an exchange website or kiosk where you may not receive the full value of the card.

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Consumer Reports has no relationship with any advertisers on this website. Copyright © 2006-2017 Consumers Union of U.S.