Tips for Redeeming Some of That $60 Million in Gift Cards

After a sluggish holiday shopping season, retailers are hoping for a bright New Year in the form of gift card redemptions. An estimated $60 million is waiting to be spent through gift cards in the next seven days. And Americans are expected to spend $26.3 billion on the cards in total.  Here are our tips for cashing in those cards:

• Spend Early - Post holiday sales are a great time to get the most value out of your gift cards. Especially this year, when retailers are especially motivated to move their merchandise.
• Don't Overspend - Retailers love gift cards because they know recipients are likely to spend more than the value of the card when they redeem. It's best to spend just a little more than the card's worth - so you're sure to redeem the full value - and avoid using a gift card as a reason to bust your budget.
• Remember to Redeem - Each year, about $8 billion in gift card value goes unspent. Don't let your gift go to waste in 2008. If there isn't a store or restaurant nearby where you can redeem the card, look to see if you can use it online. You might also give or sell the card to someone who can use it.
• Read the Fine Print - If you don't plan to use your gift card right away, it's worth taking a few minutes to check for hidden fees or expiration dates that could reduce the value of the card or render them useless. Many states have now banned these practices for gift card issuers.
• Don't Lose the Cards - Unlike credit cards, most gift cards don't come with any protections against loss or theft. If you do encounter a problem with your gift card there isn't much you can do to recover the value. Some merchants provide loss/theft protections for consumers who register their card online.

What's your favorite gift card to give? To receive? Share your feedback and tips in the comments section below.

Emily Davidson – Credit.com credit expert and former TransUnion insider. Emily writes about credit reports, credit cards, loans and personal finance as the CreditBloggers.com moderator.