Can You Return Unwanted Gift Cards? Plus Alternatives
According to the National Retail Federation (NRF), holiday spending on gift cards in 2020 was expected to be $27.5 billion. Given that an estimated 3% of gift cards are never redeemed, unused gift cards could leave a whopping $825 million on the table. Maybe you were the recipient of one or more of these gift cards that are destined to lay dormant in a desk drawer until the day you get around to cleaning that drawer out. But is it possible to return these gift cards and get cash, like you did with that ugly sweater Aunt Ethel sent you that was two sizes too big? Well, maybe, and even if you cannot, there are some better alternatives to letting the cards take up space in your desk.
Check the Merchant’s Gift Card Policy First
Call the merchant directly and inquire regarding its return policy for gift cards. A large number of the big-name stores, including Walmart, CVS Pharmacy, Kroger, Home Depot, Walgreen’s, and Dollar General, have a “no return” policy for the cards. Others, like Target, Macy’s, Saks Fifth Avenue, Starbucks, and Verizon, will allow you to return a gift card for a refund under certain conditions. Some will allow you to return only a physical card, not an e-card. Most require that the card be unused and that the original purchase receipt be presented—which means you will have to contact your gift-giver and let him or her know that their gift wasn’t exactly what you wanted. And there is no guarantee your gift-giver even kept that receipt. Too, the refund is often given in the original form of payment, so if your gift-giver used a debit or credit card to purchase the card, the refund will be credited to his or her card, not given to you in the form of cash.
This said, some states require that you be paid cash for your gift card balance, regardless of the merchant’s stated policy. Do not get too excited, though. Many states that do, like Rhode Island and Vermont, only require it when the unused balance on the card is less than $1.00; in others, like Colorado, Maine, Montana, New Jersey, Oregon, and Washington, that threshold is $5.00. Massachusetts bases it on the card balance; the merchant must pay you the balance on the card in cash if only 10% of the original amount remains. California probably has the best deal. It requires merchants to redeem the card for cash if the balance is less than $10.
Alternative Ways to Use an Unwanted Gift Card
So, what if your gift card is for a merchant that has a “no refund” policy? Or maybe you are afraid that asking the gift-giver for a purchase receipt would hurt his or her feelings. Is the card destined to become part of the clutter in your drawer? Not if you’re smart. There are a number of ways to get value from that unwanted gift card, all of which have to be preferable to letting it sit unused. Below are some of these:
- Sell it for cash: There are some websites that facilitate the selling of gift cards. Cardpool Gift Card Granny, CardCash, Raise, and Junkcard are a few you can check out. The sites’ terms differ somewhat. Cardpool’s website indicates you can expect to receive up to 88% of the gift card’s value. Gift Card Granny gives you the option to sell your card for immediate cash or list it on the site and accept the highest bid. However, you might be able to get even more for your card by selling it on eBay or Craigslist. The current bid on eBay for two $5 Dunkin Donuts gift cards is $9.21, and a $50 Red Lobster gift card on Craigslist for my area is listed for $40.
- Exchange your card: Another option is to trade your unwanted gift card for one from a merchant you frequent. Perhaps you can exchange it with a friend or family member for close to its face value. You might even consider setting up a gift card exchange within your circle of friends and family. Alternatively, if you see a similar gift card—but for a merchant you prefer—listed for sale on a site like Craigslist or eBay, consider contacting the seller and arranging an exchange.
- Regift the card: Maybe you do not happen to like the restaurant for which you received the gift card, but you know that one of your friends or relatives does. Bingo. Birthday present shopping done.
- Donate to charity: Instead of writing a check or giving cash, donate your unused gift cards to charity. If you itemize your expenses, you will be able to deduct the face value of your unused cards from your taxable income.
- Purchase an item for resale: Even if you don’t happen to frequent the store for which you’ve received a gift card, consider using the card to shop there for sale items that you can then resell on a site like eBay, Craigslist, or Facebook Marketplace. You could even end up with more money than the face value of the card.
Bottom line: letting those gift cards lay around until you decide to discard them is like taking a match to a handful of cash—cash you can add to your emergency fund, if nothing else.