Discount gift cards are an amazing way to save money. What's not to love? You effectively set your own sale day any time you want when you purchase a gift card for significantly less than face value. Thanks to several reputable sites it's easy. Combine your gift card with sales events and save even more. Add a coupon on top of that and you're a savings pro. Purchase the discount gift card with your favorite credit card to receive reward points and you're a master. There's seemingly no downside to buying and using discount gift cards. Unfortunately there are a few, which scare some people away from buying them at all. Below are five ugly truths about discount gift card websites everyone should know.
1. Your Card Could Arrive Empty
If you frequent discount gift card sites often enough you're bound to encounter a dud now and again. It happens even with the reputable sites. You receive your card and when you go to use it you're told the balance is zero. Wait. What? You just bought the card and haven't used it. How could it be empty? Who knows why it occasionally occurs? To protect yourself it's extremely important to check the balance immediately after receiving it. If there is an issue, bring it to the company's attention for a replacement or refund.
2. Your Card Balance Could be Skimmed
This scam allows people to have their cake and their gift card too. Discount gift card sites make money by buying unwanted cards and selling them for more than they buy them for. It's a simple concept that mostly goes off without a hitch. However, every so often someone tries to be slick by selling a card to a site and also spending the balance, leaving you with nothing. How does this happen? It's easy, really. All a dishonest seller has to do is keep the card's information (number and PIN). With that anyone can make a purchase with your gift card.
The best defense is to check your card's balance immediately upon receipt, and use the card as soon as possible. Another option if you think you'll have the card for a while is to try to transfer the balance to another gift card. Often time stores will allow you to transfer funds from one card to another if you explain that you fear the card has been compromised. My discount gift card got skimmed once. Luckily the websites have policies and procedures in place to protect buyers. I was reimbursed.
3. They're Not Worth the Time
As awesome as discount gift cards are for saving money, sometimes they just aren't worth the time and effort. If you've ever seen gift cards offered at a 1% discount you know what I mean. On a fifty dollar gift card your savings is fifty cents. I know a penny saved is a penny earned and all of that, but even if you're fanatical about saving that's a bit far to go.
4. It Might be a Bait and Switch
One thing I've learned when searching for discount gift cards is to hold off on getting excited until it's confirmed that the desired card is available. There's nothing worse than thinking you've found a card you want at an attractive discount only to discover that the inventory is exhausted. What a disappointment! But hey, such is life when it is first come first served and the card is popular, right? Except that some cards seem to always be out of stock yet listed as available. The bait and switch comes when you click on it each time to find a suggestion to consider purchasing similar cards. Grrr.
5. You Have to be Rich to Get the Best Discount
Okay, not really, but it can sometimes feel that way when the biggest discount is reserved for cards with huge balances. For example, one time I saw that a discount gift card site had cards for a clothing retailer for "up to" 28% off. When I clicked on it most of the cards in the 10-25-50 dollar range had discounts of around 16% which isn't bad. The card that was discounted 28% had a balance of $928 which could be purchased for $707. That's a huge discount, but the price was too rich for my blood. It's pretty common to see some variance between cards (like 19.6% off vs. 20%), but just know that if it's a huge discount, you may need to buy a card with an equally huge balance.
Clearly there are some important things to keep in mind when buying discounted gift cards to reduce your risk of loss and increase your chances of getting the card you want (when you want, in the amount you want, at the price you want to pay). Even still, buying discount gift cards are an excellent way to save money. Choose your site wisely and watch your savings add up.
Kim Owens is a psychologist, former college VP, and awesome deal getter currently obsessed with zoodles and launching her new blog MoneyUndertheCushions.
She invites you to get your complimentary copy of the "Goof Proof Guide to Slashing Your Cable Bill (and More) and Saving Hundreds or More a Year!" You'll also receive updates, tips, and inspiration on ways to, "Make More, Save More, and Be Happy." Come on over and join the Money Under the Cushions gang!.