Buying discounted gift cards can be an easy way to spend a bit less. There are a number of websites that sell discounted gift cards, both physical and electronic. Depending on the retailer, the savings can be a few percent to 25% off, or more.
Though buying discounted gift cards is straightforward, I do concede that it’s not completely without risk, for a few reasons:
- Someone else has the gift card’s information, and could potentially spend the balance down even after they’ve sold the card to the broker website, or directly to you.
- Physical cards need to be mailed to you, and they’re active while they’re in transit. Even though there are hefty fines for tampering with the mail, it’s a potential headache to track down the thief or to get restitution.
- The card could have been stolen somehow, or could have been purchased with a stolen credit card. And you’re the not-so-happy new owner.
Are discounted gift cards a lost cause?
Despite these risks, I’m still of the opinion that, done correctly, buying discounted gift cards is low-risk, or at least no different than buying anything else second-hand.
I search with Google for instances of people buying stolen gift cards (unwittingly) and subsequently getting into trouble. People have gotten into trouble for using stolen gift cards, but in all cases I found they knew that they were stolen (and may have even stolen them themselves). Though the terms and conditions of most of the websites selling discounted gift cards expressly limit their liability in such cases, there appears to be little cause for worry.
In the case of the bigger discount gift card brokers, they guarantee the physical cards they sell to you for at least a month and a half, often longer. Here’s a breakdown of the length of the money-back guarantees for a number of the big players:
|Discount Gift Card Site||Money-back guarantee*|
Here are a number of precautions that you can take to greatly reduce the risk of having a bad experience:
- Buy from established sites with good track records. Reputation is everything with gift card marketplaces. Lots of cards and lots of traffic over lots of time means lots of business, because people generally trust them already.
- Pay attention to your orders. After you purchase a card, you should follow the messages from the site as to when the cards are expected to arrive. The sites I’ve bought from send me an email when they’ve shipped the cards. We make sure to watch our mail for the cards.
- Verify the balances on the cards ASAP. The more quickly you report any problems with the card to the website, the more helpful they’ll be.
- Keep records of the purchase. If something goes south, you’ll have evidence that you didn’t buy the cards in a dark alley on the wrong side of town.
- Buy only the physical cards that you plan to spend soon. Holding gift cards for a long time isn’t good practice anyway! Ideally you should plan to spend the cards before the return guarantee expires for those cards. You want to be covered in case the seller digs up the number for the card and spends it down somehow before you do.
- Plan on spending electronic gift codes immediately. Electronic codes are far easier to spend after they’re sold than physical cards. Also, electronic codes don’t carry the same level of guarantee from the discount sites that physical cards do. But, it’s also easier for the buyer to spend them, so there you go!
- If a website offers warnings about transferring balances to store cards, listen to them. They have likely had above-average issues with some retailers canceling customers’ accounts and draining card balances when the card is suspected or reported stolen. They don’t want to have to cover any more losses than they have to; it’s not fun for the hapless buyer, either.
- Keep things at a simmer. This means not loading up on big cards. It also means not getting a whole ton of little ones, because using up three or more cards in one purchase could arouse suspicion.
- Above all, use common sense. I know that Walmart cards don’t go for much more than a few percent off of face value. A website offering them at 30% off is a huge red flag. If it looks too good to be true, it probably is.
How has your experience been with discounted gift cards? If you use them, how do you use them safely?
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