Discounted gift cards: The new coupon?

That’s how one guy described discounted gift cards — the subject of my current column, “Instant savings on holiday shopping,” over at MSN Money. (Edited to add: That column is no longer available on the MSN Money platform. Read on for the basics.)

These cards become available for various reasons, usually because their owners need the money or because the gift was unsuitable. Resellers like Plastic Jungle or Cardpool make them available to consumers at less than face value.

You can save 3% to 30% (or more) on cards for places you plan to shop for the holidays. There’s an aggregator site called Gift Card Granny that pulls up the best deals from eight different sources.

But these aren’t just for gift-shopping. You can use this “new coupon” to provide consistent discounts for your everyday purchases.

For example, a friend of mine loves going to the movies. I clued her in to 20% discounts for two of the theater chains in her area (Regal and Cinemark). She sent away for two cards. The 20% plus her senior citizen discount will stretch her entertainment dollars.

Do you buy gas at Shell, meet friends at Chili’s, shop clearance sales at Kohl’s? Gift cards are currently available at discounts of 3%, 10% and 12%, respectively.

Some of the cards are full-value and could technically be given as gifts all by themselves. Most of the people I’ve talked to about this feel vaguely uncomfortable doing so, however. The resellers guarantee the card balances, but somehow people don’t like giving a discounted card.

Whatever. Just use them to buy gifts, then, or to hit the post-holiday clearance sales.

Incidentally, Gift Card Granny also includes the best places to sell your unwanted gift cards. So if Grandma hasn’t figured out that her favorite store isn’t your favorite store, or if your brother’s idea of a joke is to give you a steakhouse gift card even though you’re a vegan….Well, you have options.

Except, of course, about writing thank-you notes. That’s not optional.

Related reading:

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  1. Hey, an aggregator! Thanks!! For the record, I have no qualms about giving a discounted gift card (after verifying the balance on it). What’s the difference?

    • Donna Freedman

      @Bashtree: I’m with you, for the most part. The only exception would be if I ordered a gift card for Christmas and it showed up with wedding bells on it. 😀 It happens.

  2. Wow….I had no idea that you could sell gift cards or buy them at a discount. Thanks for the info.

    • Donna Freedman

      @Lenie: You’re welcome. I’m delighted to have learned of this myself, since I’m heading up to Anchorage for a month and want to take my nephews to the movies. Twenty percent off, baby!

  3. I used Plastic Jungle to sell a few gift cards, and it was a very easy way to score $80 that was otherwise just sitting in my wallet.

    I planned on purchasing a few discounted gift cards as wedding gifts, but I never could get myself to do it. I didn’t think I was philosophically opposed to it, but I guess my subconscious thought otherwise! You’re right though, it’s a great way to save on your every day purchases (or splurges).

    • Donna Freedman

      @Lindy Mint: I agree about the “just sitting in the wallet” aspect of many gift cards. Anyone interested in selling should use Gift Card Granny to discover the best buy-back rate, though.
      The nice part about these buyers? They don’t care if you’ve used some of the card. When you go on the site you’ll see cards with values like “$43.19.” Doesn’t matter if you’ve used the card once or twice; as long as it has a value of at least $25, the re-sellers will usually want it.
      Thanks for reading, and for leaving a comment.

  4. Donna,
    I’ve been doing this regularly for a few months now. I buy cards for restaurants we frequent (like TGI Fridays, Cold Stone Creamery and Ruby Tuesday with BOGO coupons, of course!) at 10% discounts. I also have bought Gymboree, Ann Taylor, Petsmart (where we get our pet food anyway!) and Staples cards. I’ve been trying to spread the word to my friends but it’s been slow going getting them to adopt this practice.
    There are only two draw backs to this–one, which you mentioned, that you never know what the card is going to look like if you want to give it as a gift and two, for the clothing stores, these are usually “merchandise credit” rather than gift cards. This posed a problem for me when I tried to spend the Gymboree card during the special period to earn Gymbucks (50% off a future purchase). The store would not allow me to use it because they assumed I returned other clothing I bought at full price to be able to buy this clothing with the Gymbucks reward.

    • Donna Freedman

      @Diana B: I’ve noticed the same reluctance with people I’ve told about this deal. They keep thinking there must be a catch. Or they say stuff like, “Oh, I don’t have time to do that sort of thing.” It takes 5 minutes or less!
      My friend who loves the movies was ecstatic at saving an extra 20% in addition to her senior discount. Her mama didn’t raise no fools.
      Merchandise credits…well, you pays your nickel and you takes your chances. One of the women in the story sold a merchandise credit to a card re-seller after getting a Coach handbag she didn’t like. She used the money she earned on a manicure and pedicure.
      Thanks for reading, and for leaving a comment.

  5. One concern I have buying discounted gift cards is if the seller is actually telling the WHOLE truth about the value. What if seller claims the card is $50 BUT because of use or card fees is actually down to $42.50? That can eat up a BUNCH of the savings. Any recourse???

    • Donna Freedman

      @HollyM: Companies like Cardpool or Plastic Jungle guarantee all the cards. If you buy through eBay and the card isn’t what it’s supposed to be then you can file a dispute and ask to have your money refunded.
      If you’re buying in-person, then you call the 800 number on the back of the card and find out the current balance.

  6. Am I being Scrooge? This is useful info, but it also suggests that buying people giftcards may not be the best idea. Why not ask your intended recipient where he/she likes to shop? I can see giftcards being regifted over and over–perhaps an instance of Zeno’s Paradox as they get smaller and smaller with each resale.

    • Donna Freedman

      @Frugalscholar: The original article mentions that a lot of people don’t like giving discounted cards. For some reason the idea skeeves them right out.
      Me, I love getting gift cards. Not everyone does. I agree that it’s a good idea to sound people out about their favorite shopping spots. They might love getting an extra $25 or more to play.
      But that brings us to another couple of reasons some people don’t like giving GCs: Because now the person knows how much they spent, or because they can’t afford $25 per gift. I know from personal experience that it’s possible to get wonderful (and maybe even appropriate!) gifts for a lot less than $25 per person.
      That said, I am giving several gift cards this year — but in my case, I earned them through rewards programs.
      Thanks for reading, and for leaving a comment.


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