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If you are planning to give someone a gift card or have just received one yourself, you should read this.

1. Don’t pay full price for gift cards. If you’re a member of a warehouse club like Costco, you can often buy gift cards at a discount. Also, check your local Craigslist or eBay for people selling their unwanted gift cards. If the store isn’t hugely popular, you may be able to get the gift card at a steep discount. If you’re going to buy on eBay, make sure you buy only from sellers with an established reputation. When you’re buying through Craigslist, make sure the person you’re buying from is not a criminal. If they are selling many gift cards, they usually are. You don’t want to buy stolen gift cards. College students are usually a safe bet.

2. Buy gift cards that are likely to be used. Gift cards are a profit center for most merchants that issue them. For one, until someone actually uses a gift card, the merchant is basically getting an interest-free loan. Moreover, a lot of people never get around using their gift cards at all.

3. Buy gift cards that mean something. Unless the person you’re getting the gift card for is in deep financial trouble, you should avoid buying Visa or American Express gift cards or grocery store gift cards. They are equivalent to giving cash. Since the gift card is likely to be spent on everyday items, the recipient will soon forget you ever gave it to them. A better idea would be to give them a gift card for something that will remain memorable. Gift cards for a theme park, a spa, or a classy restaurant are more meaningful.

4. Sell gift cards you don’t need. If you are the recipient of a gift card you don’t need, feel free to sell it. If it’s for a popular store or restaurant, you may be able to get 80% to 90% of its value back. Just post an ad in your local Craigslist. Avoid eBay because you will have to pay all kinds of fees and it’s too easy to get conned by unscrupulous buyers.

5. Redeem your unwanted gift card for cash. Some states such as California have passed laws requiring merchants to refund the remaining value on a gift card when the balance is low, typically less than $10.

6. Beware of account maintenance fees or inactivity fees. When you receive a gift card, you should use it up as soon as possible. That’s because account maintenance fees or inactivity fees may reduce the value of the card the longer you keep it.

7. Beware of gift cards from stores about to file bankruptcy. Another reason to redeem your gift card as soon as possible is the possibility that a store might go bankrupt and refuse to accept your gift card. Gift cards basically represent unsecured loan obligations. When a store files for bankruptcy, it longer has to accept any outstanding gift cards. You may go to court to ask for your money back. However, as a creditor with an unsecured loan, you are at the bottom of the pack. The secured creditors get first dibs and you will be lucky to you get anything back at all.

• California Gift Card Law - Redeem it for Cash

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