Avoid Getting Snared in Gift Card Bankruptcy Web
Photo by lucias clay
On the heels of Blockbuster Video's Chapter 11 filing on Thursday, gift card holders once again are wondering whether they'll be left out in the cold. Consumers fear a sad repetition of the scenario seen when Linens 'N Things, Sharper Image and Mervyn's reneged on gift card deals at the beginning of the Recession.
So what can you do to avoid your gift cards turning into little more than pricey bookmarks? Granny offers the following seven tips.
1. Go Mobile
Plastic cards tend to sit forgotten in our wallets and drawers. The new breed of mobile gift cards make it easier than ever to cash in credit before it becomes obsolete. Fortunately, new terms of the CARD act mean you have five years to use the money loaded onto your card before expiration.
2. Shop Online
Online shoppers know gift card codes are easier to use than plastic. For example, if you buy Barnes and Noble gift cards online, you can purchase a code to plug in at the virtual checkout. No plastic, no muss, no fuss.
4. Use It Now
If you're still holding on to a Blockbuster gift card -- a scenario it's rather difficult to imagine -- hop to it and cash in that sucker today!
5. Avoid Small Companies
Smaller merchants or restaurants open and close more frequently than major chains, leaving you with even less recourse to cash in on your gift card. While companies offering similar products may step in to honor cards issued by their competitors, this rarely happens with small businesses.
6. Go With Solid Performers
Some companies are a safe bet. For example, Amazon and iTunes gift cards are going to be useful for many years to come.
7. Watch the Stock Market
It pays to keep an eye on companies that are floundering, although you don't really need to watch the Stock Market ticker. We've all known Blockbuster was about to bite the big one for some time, thanks to management's lack of foresight.
You might want to keep an eye on the following nine corporations that appear on Business Insider's list of "Big Companies Most Likely to Declare Bankruptcy." The shopping-center owners are of particular concern as their downfall can have a cascading impact on major-merchant occupants.
1. General Growth Properties (Shopping Centers)
2. Developers Diversified Realty Corp. (Shopping Centers)
3. Ambassadors International (Hotels & Leisure)
4. Supervalu (Grocery Stores)
5. Save A Lot (Discount Grocery Stores)
6. NexCen Brands (Retail firm with over 1,120 franchised stores)
7. Eastman Kodak (Film and Cameras)
8. Porsche Autombil (High-end Cars)
9. Renault (French Autos)
Finally, if you do get stuck with some bankrupt plastic, check out Granny's post on "16 Creative Uses for Useless Gift Cards."