Are Gift Cards Are The Worst Product Ever?

This post may have affiliate links. Please read the Disclosure Policy for complete details.

Gift cards used to be cool!

Everyone wanted one.

The typical response to the question “What would you like for [enter occasion]?” would be “Just get me a gift card to [enter retailer]!”

Gift givers were all too happy to give a gift card, too as it was a way to not have to put much effort into the gift…

Plus they sure as heck didn’t have to go from store to store trying to figure out what to get.

And the recipients were more than happy to accept the gift cards.

They didn’t have to worry about opening a wrapped box just to find a pair of socks, an ugly sweater, or another item(s) they had to feign interest in.

To see how popular gift cards have become, just take a look at your local grocery or drug store.

I’d guarantee that you will find at least one display of gift cards for other stores.

Let’s not forget about “rewards” such as Rakuten cashback bonus offers, business referrals, survey rewards, etc.

But things aren’t all rainbows and unicorns as there are people who don’t like them very much, including me!

Gift Cards Make For Lazy Gifts

Gift card wrapped in a blue folder with a silver stain ribbon tied in a bow.
Many people feel that giving a gift card as an actual gift is lazy and shows no thought. Do you agree? Leave a comment below!

This isn’t my own opinion, but something I’ve heard/read about multiple times so it bears inclusion here.

The biggest complaint seems to be that it takes no effort.

I mean, I’m pretty sure the giver does have to spend a bit of time thinking about which store’s gift card to give.

But that isn’t what people mean.

It’s lazy in that it doesn’t show any thought being put into the gift in terms of it not being meaningful to the recipient.

Some people think it’s no different than simply giving cash.

I can see where people are coming from with that viewpoint.

There is a time when a cash gift can be unquestionably appropriate such as a wedding or bar/bat mitzvah.

The reality is, however, that many people think that gift cards make for a lazy gift.

Store Gift Cards Lock You In

Different gift cards of many brands such as Amazon, Netflix, Xbox, Google Play, Best Buy, Spotify
Montreal, Canada – April 6, 2020: Different gift cards of many brands such as Amazon, Netflix, Xbox, Google Play, Best Buy, Spotify. A gift card is a prepaid card that you use to pay for purchases

Now we get into my reasons for disliking gift cards.

One of the biggest reasons for me is the fact that you have no flexibility.

You have 3 options that may not be ideal:

  • Force yourself to use the card at that store
  • Try to sell it
  • Regift it

This kind of ties into the idea that a gift card makes for a bad gift.

If you even put in a little bit of effort to think of a store where you think the recipient would appreciate a gift card, that’s not always the case.

Maybe they simply don’t need anything from that store at the given moment.

Maybe you based the decision on limited information or an incorrect assumption.

I’ve experienced something like this firsthand:

I mentioned buying something at the grocery store (for the life of me I can’t remember what it was, but that’s not the important part) to my mother one time and for months moving forward she would clip the coupons for it to give to me.

She took that one purchase and turned it into something bigger.

People do the same when it comes to gift-giving:

They will recall one mention of a store or a single trip, and while the thought is in the right place, the person might not have a desire to shop there.

I’ve also had someone give me a gift card to Starbucks, but I don’t drink coffee–and yes, I know it sells other things but coffee is the main thing there.

So what do you do after you smile and say “thank you”?

You can re-gift it, which is what I did with the Starbucks card.

You can also try to sell unwanted gift cards, but you need to be forewarned that you will not be getting 100% of the value in return.

Or do you hold onto the card, hoping for a reason to use it until you forget about it and find it while cleaning out your drawers years later?

Some gift cards, however, have multiple stores available on them so those may make it a bit easier to use the card, but won’t necessarily solve the problem completely!

Gift Cards Can Force You To Spend Money

Restaurant Retail Gift Cards scaled

Another reason I don’t care for gift cards is that there is almost always a personal contribution involved.

Depending on the amount of the card, you may be forced to spend your own money to use it.

Let’s say you get a $10 gift card to Best Buy.

What can you purchase there for $10?

There likely isn’t much I’d imagine, so if you wanted to use the card you would have to put your own money in to make up the difference.

If you happen to find something costs less than the value of the gift card you get to carry a balance on to the next purchase.

Of course, the personal outlay will come with that next purchase or…

You Can’t Always Clear Gift Cards

The opposite problem is what happens when you don’t want to spend any of your own money.

In those cases, you end up leaving money on the store gift card which can, again, sit in a drawer forever.

There’s not much else to say about this.

You are either going to spend extra or lose some money unless you have the magic ability to spend exactly the amount on the card!

And speaking of leaving money on a gift card…

Debit Gift Cards Suck For Online Shopping

Visa Debit Gift Cards scaled
Debit gift cards are supposed to be easy to use for paying while shopping, but that’s not the case when it comes to online shopping.

Some people might be inclined to prefer a debit gift card ie: Visa or MasterCard due to the universal acceptance and flexibility that store gift cards don’t provide.

It’s a logical assumption but leaves you in a more difficult position when online shopping.

With virtual debit gift cards, you can sometimes add them to a digital wallet such as ApplePay to use in a store or your Uber account to pay for rides, so it’s not a problem.

Neither are the physical gift cards.

The issue comes into play while shopping at home.

You see, stores are specifically set up to process their own gift cards as separate payments.

That means if you go online you can enter a store gift card separately from the payment method.

But, when you are using a debit gift card, you don’t have a “gift card”, you are using the actual payment method!

Online stores just can’t process debit gift cards separately, so they make terrible options for online shopping.

You need to play mathematical gymnastics when shopping with those debit gift cards!

The one workaround I have found–and this works really well for those times when you have small amounts remaining on the debit gifts:

Use the card to replenish your Amazon gift card balance!

There’s no minimum amount so you can reclaim all the change remaining on your various debit gift cards and give them a new purpose.

Unfortunately, this doesn’t work with store gift cards for obvious reasons.

Wrapping Up

Don’t get me wrong, free money is free money.

I’m not stupid–I’m not going to turn that down.

But in all honesty, just give me cash.

If you’re giving me a gift, just give me cash.

If you’re giving me a reward for taking a survey, just give me cash.

If you’re giving me a “thank you” for a referral, just give me cash.

Your Turn

What are your feelings about gift cards? It can be about giving, receiving, spending, whatever. Have you ever been faced with any of the situations described above? Do you even care about the issue?


Leave a Reply

Your email address will not be published. Required fields are marked *