Money Blue Book

This is a guest post from Marc Pearlman.

Back in the early to mid-1990s I made my living by sitting in front of computer monitor with green and red glowing pixels that flashed stock and commodity prices. I was an off-the-floor stock and commodity trader, and in my world, green and red meant everything. Green meant I was making money, and red meant I would be drawing out of my savings to pay for monthly expenses.

Fortunately for me, I was given some sage advice from a wealthy mentor of mine who was about 25 years my senior and knew of an obstacle that I was likely to encounter. I still remember his wise words: “Kid, make sure you put money into an account you can draw from when times are lean–and expect some lean times. It’s part of the game.”

Even though I heeded his advice, there was one thing I didn’t account for: the feeling I’d have when trekking to the bank to withdraw those savings. (more…)

Selling used books online is one of the easiest ways to significantly declutter your home and earn some extra money in the process. Although it might seem like the intellectual thing to do – to have volumes of books and textbooks lining your book shelves to offer up that desirable professional-looking scholarly facade, but chances are, after you’ve read those books once you’re very unlikely to ever read the vast majority of them ever again. Thus in the name of decluttering and staying organized, why not try to downsize your personal library periodically, and make some extra money while you’re at it by selling off some of your used books and textbooks?

As a part time personal finance blogger, book publishers and book authors frequently send me free personal finance books to read and review. After blogging about making money and a whole slew of financial topics for several years now, in this span of time I’ve probably received well over 30-50 books about money (the vast majority of them parroting and repeating the same material frankly). If I did not periodically sell them online or donate them away to friends and readers of this blog, the incredibly large pile of books would probably have winded up clogging a large corner of my house, gathering dust and taking up space.

College and graduate students in particular have the greatest to gain from not delaying in their efforts to sell off their old and used textbooks online. School textbooks are by their very nature profitable exchanges for the book authors and publishers who issue new editions every few years and force all current book owners to buy the new versions to stay current. Thus, limited in terms of value by short multi year lifespans, school text books are only as current and up to date as the next year’s release date. That is why I always strongly recommend that students sell their books quickly and convert them back to cash form as soon as the school semester or school year is over, lest they delay and wind up in ultimate possession of yesterday’s edition.

Where To Sell Your Used Books To Get the Best Price and Most Money Back

I started selling new and used books online back in 2000 when websites like eBay.com, Amazon.com, and Half.com were just gaining prominence. While I sold my fair share of unwanted books to local used bookstores, thrift stores, and even pawn shops for cash, I focused primarily on online selling due to the higher prices I could fetch over the Internet. Selling back used textbooks has always been a great way to recoup some of the expensive costs of expensive textbooks, but unfortunately, college and university bookstores these days continue to pay students the worst prices for book buybacks. In most cases, college bookstores usually only offer half or less of the original purchase price for buybacks so that they can in turn sell the used titles back to other students for huge markup profits. Today, there are many places over the Internet where you can sell your used books for much better returns – each with its own host of pros and cons.

1) eBay (Auctions) – If you’re a regular consumer looking to buy a new or used book for cheap, eBay will probably be your best bet as auction deals abound there and final sale prices are incredibly low. However, if you’re a seller of used books or textbooks, the general public perception that eBay offers super low prices definitely works against your favor. But due to eBay’s incredibly large customer base and superb ease of use, it’s an online book selling resource you simply can’t ignore. eBay is one of the very quickest, easiest, and simplest ways to sell used books online. Oftentimes if you’re listing an auction for a used book, you can simply utilize eBay’s book template setup feature, punch in the book’s ISBN number, and have an effectively designed eBay auction ready to go in just a moment’s time.

Even if you don’t always get the best prices for your books with eBay, it’s almost a solid guarantee that they will sell (albeit at eBay market determined prices). If you’re looking to sell an obscure, rare, or valuable book, or perhaps you’re looking to capture high traffic volume for an auction involving a collection of books at the same time – eBay might be your best bet due to its ability to offer up maximum public exposure. But because eBay auction consumers have been conditioned and accustomed to seek out and demand almost unreasonably low prices for their bids for some time now, you’re unlikely to make a tremendous amount of money with eBay book auctions if you’re a seller. Ebay’s continuously increasing listing fees and rising commission charges have definitely taken a serious toll on seller profit potential in recent years.

2) Craiglist.org (Classified Ads) - Craigslist is a very popular online classified ad listing website and is also truly the wild, wild west of market place transactions. The greatest appeal of Craigslist for online book sellers and buyers is that there are no commissions, advertisement listing fees, or special mandatory shipping charges required. Pretty much anything goes on Craigslist – with all transactional terms and conditions negotiated and worked out between sellers and buyers themselves. If you have used books for sale and do not wish to be constrained by the auction rules or regulated limitations of policed sites like eBay or Amazon, you might want to try out Craigslist. Prices vary wildly however – sometimes they offer prices higher than eBay listings while other times they’re lower. But in terms of saving time and effort, if you’re looking to get rid of your used textbooks or old book collections all at once in large parcels, Craigslist is ideal.

Here’s a suggestion for Craigslist sellers – if you’re looking to sell a large bundle of books at once, try putting multiple books together into a single collection and posting the listing for sale on Craigslist. If potential buyers express interest, try throwing in additional books to spicen up the pot in their favor if you’re willing to do so. This type of book selling strategy works incredibly well for smaller and lower priced books that don’t sell as well individually.

3) Book Buyback and Textbook Rental Websites - The biggest problem with utilizing do-it-yourself (DIY) type sites like eBay, Amazon, or Craigslist to personally list and sell your used books is the time and effort involved to list and market every one of the books for sale. Trying to keep shipping costs down and save money on the cost of packaging envelopes isn’t easy to do if you’re not an adept micro-tasker. One viable alternative to the do it yourself approach is to solicit the services of an online book buying website that will pay you a one time bounty for all of your available and aggregate used books in one fell swoop. Usually after you’ve provided the book buyback website the names and ISBN numbers of all of the books you have for sale, the site provides you pre-paid postage labels for you to ship the books to them via the postal service. With book buyback services, there is no need for you to manage auctions, handle customer service inquiries, or follow up regarding timely payment. Once the folks at the book buying firm have received your books and reviewed their condition, they usually issue payment directly to you in the way of a check, PayPal payment, or even a direct deposit into your checking account in some cases.

The biggest downside with these online book buyback websites is the incredibly low price they generally pay for used books and textbooks. Because they pretty much do all of the work for you, these companies generally pay only small fractions of the original retail price for these books. Rarely do their offers ever match or exceed the prices that used book sellers can fetch on their own via eBay, Amazon, or even Craigslist. While I don’t necessarily vouch or recommend any one particular site for its quality or reliability – here are a few book buyback and book rental websites I’ve come across that you might want to follow up on – Chegg.com, eCampus.com,  BookByte.com, Cash4Books.net, Barnes & Noble, TextbooksNow.com, Textbooks.com, BooksValue.com, WeBuyTextbooks.com, BooksValue, TextbooksRUs, and CollegeBooksDirect. Let me know if there are any other sites worth mentioning, worth reviewing in detail, or even worth criticizing.

4) Amazon.com Used Books and Textbooks (Recommended For Most Sellers)

Compared to all of the other online ways of selling used textbooks and old books, I prefer listing books for sale on Amazon.com because it is much more intuitive to use than other alternatives. Signing up for an Amazon seller’s account is straightforward and listing your used books for sale is easy. You will be asked to describe the condition of your book, set your desired fixed price, and denote your available shipping options. Amazon.com ultimately reimburses sellers for their shipping costs but charges a $0.99 fee plus an additional fee based on a certain percentage of the final list price. Here are a few Amazon quick links for sellers that want to get started:

• Amazon’s textbook store - Click here if you’re looking to sell a used college or graduate school textbook.
• Amazon’s used book store – If you’re selling any other used book, try this link to get started.

Over the years, I’ve enjoyed a lot more regular success and have earned more profit with Amazon than say, eBay or Craigslist. Quite possibly because Amazon.com started out as a book store and many people still see and trust Amazon primarily as an authoritative source for buying books at a reasonable price, it seems visitors to the site are more willing to pay a slightly higher price premium than at other websites. But perhaps the greatest benefit of using Amazon to sell books is the ability to take advantage of the natural flow of visitors coming to the site and looking to buy a brand new book. Because used book listings are displayed alongside the prices for new book titles, you may be able to siphon off new book seekers and convert them into buyers of used, lower priced versions. Rather than go to Amazon.com and shell out $25 for a new book, you may be able to successfully lure prospective buyers into going for your cheaper $15 used version instead.

Obscure, rare, and collectible books tend to fetch higher prices via an auction or free-for-all classified ad listing than you may be able to get by selling the title via a fixed price listing on Amazon. If you prefer to sell a whole selection of titles simultaneously as a pallet or collection, you might be better off using eBay or Craigslist. Non textbooks or expired textbook editions tend to sell much faster on eBay and Craigslist where aggressive deal seekers and bargain hunters abound. But if you’re selling either a popularly used and update-to-date school textbook, or trying to sell an otherwise recognizable bestselling title, Amazon will probably be your best bet. So long as your textbook has not been discontinued due to the release of a newer edition, you should not have any trouble selling your new condition book on Amazon somewhat close to what you paid for it. Standardized books such as school textbooks and popular bestsellers almost always perform better on Amazon.com listings than on other alternative sites.

If you’re thinking about selling used books on Amazon, here are a few important tips and pointers I’ve learned and picked up in recent years:

1. Always list your used books for sale at prices lower than your closest competitor.
2. Always track your used book listing periodically to ensure that it’s being priced at the lowest it can be.
3. If your competitors attempt to low ball their prices and undercut your title listing, instead of getting into a pointless price war, try matching prices tit for tat rather than beating them instead.
4. List your used book’s condition accurately. Even if your used textbook is really in “like new” condition, you might want to list it as “very good” instead. You don’t want future potential buyer complaints to cause your Amazon seller rating to suffer.
5. Keep your shipping prices low by utilizing free shipping boxes that you naturally come across, or buy them from deep discounters like Walmart, Target, or even your local supermarket. One great way to save a lot of money on packaging and shipping supplies is to buy them through eBay. For example, check out the following prices for eBay bubble wrap mailers, and eBay bubble envelopes.
6. Always ship utilizing the cheapest method possible – For used books and textbooks, the cheapest way to ship is usually through the postal service’s media mail option. However, with certain smaller books, it might very well be cheaper to go with First Class Mail – just ask the post office to ship using the cheapest way possible.

Regardless of which method you use to sell your used textbooks and unwanted books, selling back books (textbooks in particular) is simply a great way to recoup original purchase costs. But bear in mind, unless you are somehow a very large power seller with access to special shipping discounts and access to very cheap shipping supplies, you are unlikely to get rich or make a lot of money online through selling used books alone as a business form. Like those money making paid online surveys you always see, they may be otherwise legitimate ways of earning some extra cash back, but it’s doubtful you’ll ever become a millionaire in the process. It’s theoretically possible, but highly unlikely.

Updated List Of The Best Discover Credit Cards Below

In the United States and Canada, most people are familiar with major credit card networks like Visa, MasterCard, and American Express. However, fewer people have had experience or exposure to another quiet, but big player in the credit card industry – Discover Card. Introduced in the 1980’s as the preeminent card of choice for the Sears department stores (the dominant retailer at the time), the Discover Card has had its share of ups and downs in terms of card acceptance and popularity, and has been facing a tough battle for its piece of the pie recently. Currently, Discover has the lowest market share of any major credit card issuer in the United States, and overall card acceptance at smaller stores and remote markets remain spotty. Most of the major merchant stores and retailers take Discover for payments, but smaller retailers and more obscure websites are less likely to accept it. However, despite the highs and lows over the years, the Discover Card has managed to evolve its program with attractive offers to grow with the times and remain continuously relevant.

The Discover Card was the first credit card I ever applied for and my first exposure to the use of revolving debt. I applied for the Discover Card back in high school during the height of its popularity, because at the time it was my parent’s primary credit card for everyday purchases. Since then, I’ve applied for other cards, but my old Discover Card remains a nostalgic favorite that I still use for niche purposes like gas credit card purchases or interest free transactions like 0% balance transfers. One thing I’ve noticed about Discover is the credit card program’s resiliency over the years in the face of stiff competition from giants like Visa and MasterCard. Despite the current credit crisis in the financial markets that has wrecked havoc and caused major pullbacks in card offers among major credit card issuers like Bank of America and Citibank, Discover has not retreated from its existing array of promotions.

Discover Card’s Benefits Include High Cash Back Credit Card Rewards and Attractive Balance Transfer Offers

Because of its relatively small share of the credit card market, Discover Card has needed to distinguish itself to consumers by offering more competitive reward credit card deals and more appealing 0% balance transfer promotions than most. The company has a history of frequently sending out mailers to prospective customers with tantalizing 0% APR and low interest balance transfer for life offers. Among the many benefits of carrying a Discover card, not the least of which is that the card has no annual fee, the card offers a relatively attractive selection of card offers to pick from. Discover Card currently has four line ups in its credit card offerings – the Discover More, the Discover Motiva, the Discover Open Road, and the Discover Miles card – and all four card types offer its own different reward and interest free benefits packaged into consumer, business, and student card variations. For example, the Open Road Discover card type appeals to drivers with its high cash back credit card reward rebate for gas purchases, and the Miles card appeals to business airline travelers or consumers who want to rack up frequent flyer miles quickly for free airline tickets. Other than the Discover credit cards issued directly by Discover, the company also issues Discover branded cards under the trademark of other major retail names like discount giant Walmart and wholesale warehouse Sam’s Club.

All Discover cards also qualify for high reward earning opportunities under the Shop Discover Card program. By shopping through the ShopDiscover website portal to visit its broad lineup of online stores such as Barnes & Noble, Sports Authority, Circuit City, and Hotwire, cardholders can earn extra rewards up to an additional 5-20% cash back on all purchases.

Exclusive Discover Business Credit Card Benefits Such As Free and Easy To Use Purchase Checks That Actually Earn Rewards

For its top business credit card line up, Discover also offers a very unique and intriguing benefit – the ability to write and issue fee-free Discover Card Purchase Checks. Sometimes, small business owners or entrepreneurs run into merchants or suppliers that do not accept credit cards. Discover PurchaseChecks work just like your regular credit card. When you encounter a store or retail merchant that does not accept credit cards or specifically, the Discover Business Card, simply write a check out to the merchant for the amount of your purchase. The check will appear with all your regular Discover Card transactions as a regular purchase, helping you with expense accounting and bookkeeping. Purchase Checks may be used to make any business related purchase when credit cards would otherwise not be accepted. Best of all, there is no fee or charge to use Purchase Checks and transactions are recorded as credit card purchases. All checks written get the standard interest rate offered to ordinary credit card purchases rather than the high interest rate demanded of cash advances. Quite remarkably, amounts written on Purchase Checks also earn credit card rewards, something almost unheard of among other credit card reward programs.

Of course, this raises a very interesting proposition and a rather sneaky idea for consumers and part time small business owners like myself. As we all know, consumers and non-business owners can apply for business credit cards by submitting their Social Security Number as their business ID on business credit card applications. As such, ordinary consumers can apply and qualify for business credit cards like the Discover Business Card to take advantage of benefits like  Purchase Checks. One interesting idea for credit card reward seekers would be to utilize rebate-earning Purchase Checks to pay the rent, which for many people is frequently in excess of $1,000 a month easy. For the rule abiding folks, the official stated policy of Discover Card is that PurchaseChecks may not be used to pay rent, but I guess it begs the question – how would Discover Card otherwise be able to realistically tell the difference between Purchase Check payments that you write to your landlord, and checks given to genuine business merchants? Just something to ponder about.

Current Acceptance Of Discover Card In the U.S. And Around The World

I don’t think anyone really thinks the Discover Card program is completely lacking in the way of credit card purchase rewards or 0% balance transfer offers. The knock against Discover Card has always been their seemingly weak acceptance and usage rate in the US and other foreign locations where Americans predominantly visit. Despite reportedly having over 50 million cardmembers in the Discover Network, unlike its more well known competitors like Visa or MasterCard, the Discover Card is neither widely issued nor widely accepted outside of the United States and Canada. Even in the US, while it’s accepted at most major locations like gas stations, supermarkets, mall outlets, department retailers, and online stores, it’s not always compatible with all retail merchants that accept credit card payments.

Undeterred, Discover continues to expand its adoption nationally and internationally, signing semi-exclusive agreements with certain major retailers, and partnering with big time credit and debit card networks in the US and overseas. Discover currently has a special card agreement with major retailers Walmart and Sam’s Club to issue store branded Discover cards. Per arrangement, wholesalers like Sam’s Club currently only accepts MasterCard and Discover, but not Visa or American Express. Despite the lack of international acceptance overseas, Discover has been making major inroads into countries like China, having recently signed a partnership agreement with card payment network China Union Pay (the largest credit card network in China) to accept Discover Card payments anywhere that displays the Union Pay logo. This means that you can pull out your trusty Discover credit card to pay anywhere that accepts China Union Pay.  Like Capital One credit cards, neither Discover nor Cap One charge extra interest fees for foreign credit card transactions, making them the best international credit cards to own. While places like China still remain primarily a cash based economy, card usage is growing rapidly and as China Union Pay remains at the forefront, Discover stands to enjoy unique growth potential in future market share.

Reviews Of The Top Discover Credit Cards (Consumer, Business, and Student) With Rewards and Balance Transfers:

1) Miles Card by Discover Card – Earn double reward miles on up to $3,000 in travel and restaurant purchases every year, and 1 mile for every dollar you spend on all other purchases. This offer is Discover Card’s best travel rewards credit card for earning frequent flier airline miles and free airline tickets. While this card is mostly about airline miles, you are also given the option to exchange earned miles for cash, travel credits, or gift cards – it’s up to you. Mileage rewards can be used to book free airline travel anytime with no black out dates or restrictions. There is no earning limit or maximum cap on the miles that may be earned, and all rewards you accrue never expire. There is also no annual fee. Currently, pursuant to this online offer, you can earn up to12,000 Bonus Miles – 1,000 Bonus Miles each month you make a purchase for your first year*.

2) Discover More Card – (formerly the Discover Platinum Card) – Get 5% cash back bonus rewards with the Discover More credit card in categories that change and alternate throughout the year like gas, groceries, restaurants, travel, department stores, and home improvement stores. Plus, cardholders get an extra 5% to 20% cash back on purchases made at major retailers through Discover Card’s online shopping site, ShopDiscover. All other purchases automatically earn rewards, with unlimited 1% cash back on all transactions. The More Card features a 0% balance transfer offer for a year with a 4% fee.

Currently, the Discover More Card also comes in several different card designs, however their terms and conditions do not otherwise vary significantly:

• Discover More Card – This is the standard Discover More card variation that most people seek out and apply for.
• Discover More Clear Card – This variation features numerous modern art inspired card designs to select from.
• Discover More Sea Life Card - If you are a fan of Flipper, Little Nemo, or simply are a supporter of the ocean and the fish, dolphins, whales, and coral reefs that inhabit it, then this may be your card design of choice to express that support.
• Discover More Wildlife Card – This Discover More variation offers card designs that feature mostly land and air animals like wolves, eagles, horses, and seals.
• Discover More American Flag Card – This classic patriotic card design features the American flag on its face. Nothing screams American consumerism like a red, white, and blue credit card.
• Discover More Monogram Card – This custom credit card design features your own personal name initials displayed in large artistic lettering on the plastic card face.

3) Discover Motiva Card – Earn up to 1% unlimited cash back on all purchases with the Discover Motiva card. This particular card features an interesting twist on the usual credit card rewards program. Along with your normal cash back rebates up to 1%, each time you make 6 on time payments in a row, you’ll receive a Pay-On-Time bonus reward equal to a full month’s interest added to your cash back earnings. This is a very intriguing incentive to motivate you to pay off your card balance on time and earn extra bonus rewards in the process. As with almost all Discover card rewards, your cash back earnings can be doubled in value if redeemed through Discover’s network of online retail partners. There is no annual fee.

4) Discover Open Road Card – (formerly the Discover Gas Card) – Get 2% Cashback Bonus automatically at any gas station and any restaurant.
In addition to the gas rewards, cardholders earn unlimited 1% cash back on all other purchases. Plus they can earn 5% to 20% rebate rewards for spending money and making purchases at major store retailers through ShopDiscover. Rewards may be doubled when they are used to redeem for gift cards through a list of over 100 Discover retail store partners. There is no annual fee.

5) Discover Business Card – ($100 Sign Up Bonus) – With the Discover business reward card, you can receive up to 5% cash back rewards on office supplies, 2% on gas, and up to 1% on all other purchases. Cardholders can also earn up to 5 to 20% more in cash back rebates at top retailers through Discover’s exclusive online shopping website. Your purchase rewards can be doubled when you take them as gift cards or gift certificates from many of Discover’s online retail partners. There is also an introductory 0% APR offer on purchases for 12 months, and a low interest balance transfer promotion for 6 months. However, the best card feature is the ability to write fee-free Purchase Checks to pay merchants who don’t accept credit cards. As with most business card programs, cardholders also enjoy free employee cards with customizable card limits and monthly reporting metrics on their spending. There is also no annual fee.

6) Discover Business Miles Card – With the Discover business mileage reward card, you can receive double reward miles on travel and gas purchases up to $5,000, and 1 mile per dollar for everything else. Miles can be redeemed for airfare travel or reduced prices on airline tickets for most major U.S. based airlines, on any seat, with no blackout reservation dates. Miles can also be redeemed for cash or gift cards from a huge selection of brand name partner stores. Currently the card is offering an instant bonus reward offer of 12,000 bonus miles upon card application approval, along with an introductory 12 month, 0% APR offer for all purchases. Business owners, entrepreneurs, or regular consumers operating as sole proprietorships get access to Discover Card’s exclusive reward earning Purchase Checks that can be used to pay merchants that don’t otherwise accept credit cards. There is no annual fee.

7) Discover Student Card – With the Discover student credit card, cardholders get a 0% introductory APR on credit card purchases for 6 months, plus enjoy 5% Cashback Bonus®* in categories that change like travel, department stores, gas, groceries, restaurants, and more means extra money for you, and extra toppings for your pizza.

Card holders also earn up to 1% cash back on all other purchases. The Discover Student Card is much easier to qualify for compared to regular consumer cards as it doesn’t rely on stringent income or credit checks.

• Discover Student Clear Card – Same as the regular consumer version of the Clear Card, but with lower credit limits and less picky credit approval standards.
• Discover Student Card Monogram Collection – Like the consumer version, this student version of the More Card features your name initials on the card as its design.
• Discover Student Card Tropical Beach – This card features all of the benefits of the standard Discover More card, but with a tropical beach card design.

As a stereotypical male, I seem innately handicapped when it comes to performing certain tasks – “confusing activities” that include shopping and picking out the right gifts for the right occasion. I’m sure there are some men out there who love to cruise the malls and spend hours window shopping to their hearts’ content like most of the women I know, but I’m most definitely not one of them. I can engage in strenuous physical activities and participate in aggressive sports, but yet somehow, whenever I step foot in a retail department store, I quickly become fatigued. Somehow, I instantly become drained of all energy and stamina the moment I am faced with the grueling ordeal of mall shopping. Worst yet, I’m a terrible buyer when it comes to gifting – which is why gift cards and gift certificates are such a God send for people like me.

Despite all the negative impressions and opinions that some online commentators and emotionally sentimental pundits have regarding the negatives of giving gift cards as presents, I love having at my disposal the option of buying gift certificates and store vouchers as presents for people. While it’s true that gift cards are not the most particularly thoughtful present to buy for someone you really love or care about, they are incredibly convenient and financially versatile gifts for many people. For frugal savers like myself, gift cards present the perfect compulsory incentive and forced opportunity to buy and treat oneself when we’d otherwise choose to save the money instead. If you gave a naturally frugal person a cash gift, he or she would most likely squirrel away the monetary gift in a high savings account, completely defeating the purpose of the gift reward. But by presenting the person a gift card instead, you liberate the recipient from having to make the frugal choice, treating the friend to a well deserved material recess instead – something he or she would otherwise be reluctant to decide for him or herself. It’s the perfect gift for overly-frugal people.

Sentimentality and thoughtfulness aside for a moment, gift cards also help overcome the occasional embarrassment of secretly undesired gifts. In the past, I’ve had my share of bad gifts. While I always treasure the careful thought and loving goodwill put into selecting the gifts that I receive, sometimes, I am left secretly thinking to myself that I probably could have picked out a better digital camera model or a more appropriate colored tie for myself. More often than not, the gift usually winds up permanently sitting on top of a shelf or inside a drawer somewhere, never to see the light of day again, or until it’s needed again because I need to show the original giver that I still had the gift and hadn’t thrown it away or sold it on eBay. That is why I have always been a huge fan of receiving gift cards for certain stores and retailers that fit my natural purchasing niche – popular stores with staying power like Best Buy, Macy’s, and Target. Generally, gift cards are incredibly easy to give and incredibly easy to use, and there are many circumstances when they make ideal gifts. Of course, as with all potentially good things, there are critics and detractors.

The Problem With Gift Cards And Why Many People Seem To Dislike Them

1. Upfront Charges and Maintenance Fees – Despite their immense popularity, many consumers avoid buying gift cards and handing them out as presents because they are leery of having to pay upfront gift card activation charges or having to contend with the hassle of keeping track of inactivity fees that have the potential to take significant bites out of the gift card balance. The worst case scenario involves nightmarish gift card issuers that slap hefty charges just to activate a gift card so it can be used, along with stiff fees for periods of inactivity, as well as pricey balance debits for account maintenance reasons. The worst offenders tend to be credit card or bank issued gift cards from issuers like Bank of America or American Express. Compared to regular retail store issued gift cards, these bank issued cards tend to be more notorious for imposing extraneous charges for transactions like non-usage and account balance checking.
2. Expiration Dates – One surprising aspect about gift cards that have historically turned many off from their use are the expiration dates that they used to levy. In states that allow gift card expiration dates, the gift card holder must use up the gift reward card within a certain amount of time or the card becomes useless. However today, many states have enacted various gift card consumer protection laws prohibiting expiration dates and unexpected fees on gift cards sold, at least for a certain extended period of time.
3. Interest Free Loan To Retail Stores – If you think about it, the purchase and use of gift cards is actually pretty silly. After all, why spend cash to buy something with the same transactional value as cash, but with substantially less flexibility and greater restrictions? Furthermore, when you buy a prepaid gift card, what you are essentially doing is offering the gift card retailer what amounts to a free 0% interest gift card loan. Until the prepaid gift card is redeemed by the recipient and actually exchanged for merchandise, the retailer is basically earning interest off of the money previously paid by you. The retailer is under no obligation to pay the amount back in the form of retail merchandise until the gift card’s affirmatively offered up for redemption.
4. Danger Of Gift Card Bankruptcy – Most recently, the issue of major retailers going bankrupt or going out of business has become a major headache and concern for holders of gift cards (the same way airline bankruptcies have wrecked havoc with airline ticket holders). As a gift card holder, you are essentially an unsecured creditor and like shareholders, are near the bottom in terms of money recovery during bankruptcy proceedings. When you buy a gift card from a retailer or company that goes out of business or ultimately files for Chapter 7 or Chapter 11 bankruptcy, the gift card recipient usually ends up with a card that’s worth less than the face value. While during a bankruptcy restructuring, a company may attempt to stay in business and continue to honor gift cards, some may not. In such a dire scenario, all gift cards would be rendered completely worthless. Obviously, the best way to minimize the chances of ever being caught in such bind is to always spend your gift cards quickly and not try to save them for a rainy day.

How To Buy Discount Gift Cards Online – And Tips For Using Gift Cards Smartly and Efficiently

1. Choose Retail Store Gift Cards Over Bank Issued Gift Cards – It’s important to know and understand the differences between gift card policies from banks and credit card issuers, and those issued by traditional store retailers. Gift cards and gift certificate rewards issued by banks and credit card issuers like Visa, Mastercard, and American Express tend to offer substantially more flexibility than retail store gift cards since the bank-issued gift cards can be used anywhere that credit cards are generally accepted. However, with the greater versatility comes higher fees, more upfront charges, and more annoying expiration date worries compared to the gift cards issued by traditional retailers. Unlike bank issued gift cards, the great majority of retail store issued gift cards do not impose expiration dates, and significantly fewer of them contain activation fees, or impose charges like inactivity fines or periodic transaction maintenance costs. Clearly, retail store gift cards offer much better financial value than bank issued gift cards despite their more restrictive terms.
2. Read the Gift Card Terms and Conditions Carefully Before You Buy – As with all things in life, there are contractual fine print terms and conditions that must be carefully read and headed. Always understand the rules of your gift card purchase before you buy. While oftentimes the terms and conditions are rather self explanatory, gift card buyers need to pay special attention to the existence of any potential activation charges, hefty monthly inactivity fees, or annoying expiration dates. If you are not clear on something, ask the gift card issuer before you buy.
3. Don’t Hoard, Spend Your Gift Cards Quickly – Once a prepaid gift card has been purchased, it should be treated like cash and redeemed as soon as possible. Try not to leave the gift card hidden and forgotten inside a wallet or purse as is commonly the end result of many misplaced gift cards. The longer you delay, the more you expose yourself to possible gift card balance forfeiture possibilities in the event of unexpected retail bankruptcies or program cancellations. In a tough economic recession, you never know which company may struggle and suddenly stop honoring its outstanding gift cards or gift certificates.
4. Be Extra Careful When Purchasing Discount Gift Cards Online – Because gift cards are so popular, there is a huge market for them on online auction sites like eBay where heavily discounted gift cards for places like Costco, iTunes, Home Depot, and Walmart, are often up for sale and exchange. If you are seeking the best discount gift card offers, buying them online is the best way to go as online auction sites tend to offer steeper discounts and rebates than traditional brick and mortar retailers. When seeking the best eBay deals and bidding on online gift card auctions, the higher the gift card denomination, the greater the potential discounted savings to be had (frequently 5-20% off). However, it’s important to bear in mind that while online gift card shopping may reap higher savings, there is a greater potential risk of loss. Online scammers and fraudsters abound and counterfeit gift card sellers exist, even on reputable online sites such as eBay or Craigslist. Generally, for the risk adverse, the most reliable way to buy a gift card is to purchase them from reputable retailers or from the original retail store.
5. Buy Gift Cards With Reward Credit Cards For Extra Savings – Certain reward credit cards offer up to 5% cash back rewards for purchases made at special category retailers like supermarkets, grocery stores, gas stations, drug stores, or restaurants. Particularly at certain high reward retailers like grocery stores, many sell gift cards good towards other popular retail and department stores with few activation fees or maintenance charges. By buying popular retail gift cards to places like Best Buy, Bed Bath and Beyond, or Macy’s from merchants like grocery stores or restaurants using qualified reward credit cards, you can engage in a form of credit card arbitrage by buying a discount gift card for a up to 5% off the gift card’s face value, and easily pocket the savings.
6. Keep Your Gift Card Receipt, Or Give It To The Recipient – Always keep your gift card purchase receipt or give it to the intended gift card recipient to preserve all options in the event of gift card expiration, misplacement, or card theft. While some retailers will not replace lost or stolen gift cards for any reason, most are willing to accommodate provided you can offer up the original purchase receipt. If for whatever reason your gift card expires before you’ve had the chance to use it up in full or exhaust its value, you may also be able to contact the issuer with your receipt and potentially get a limited time extension (after paying a possible fee). If the option is available, you should register your prepaid gift card if recommended to do so as it will help protect your recovery rights in case your card gets stolen or lost.
7. Personalize Your Gift Card Present With Thoughtful Accessories – Those who want to personalize their gift card presents have options these days. Many major retailers are offering up creative and customizable packaging options for gift cards. If you want to give your gift card present a more thoughtful touch, you may want to consider packaging the card with another small gift the recipient may like – for example: including simple jewelry accessories like earrings or necklaces with clothing apparel store gift cards.
8. Consider Giving Cash Or Using Chinese Red Envelopes Instead – Because gift cards are essentially the exchange of cash for something that’s supposed to function as cash, one possible alternative to giving gift cards as presents is to give out plain old cash instead. One creative way to exchange cash gifts is to present them in elegantly decorated Chinese Red Envelopes, known as “hong bao” in Mandarin Chinese. These red envelopes, stuffed with money bills, are commonly given by the Chinese as presents for special occasions like New Years and birthdays. While I don’t think our society is quite there yet in terms of new approaches to cash gifting, it’s still an interesting multi-cultural trailblazer route to consider.