4 Responses to Gifts Cards for Christmas – Will They Be Worth Their Value After The Holidays?

1. Elliott November 22nd, 2008 at 8:17 am «

   Thanks MM, you saved many a tear with this
   digg
   and reddit
2. Teddy Partridge November 22nd, 2008 at 1:34 pm «

   Gift cards qualify as deposits and are insured if the funds have been placed in an FDIC-insured institution. You might ask whether your retailers’ gift card funds are so insured before buying one.

   WASHINGTON, D.C. — The Federal Deposit Insurance Corp., the entity that guarantees bank deposits, has issued an opinion stating that funds on gift cards and other stored value cards qualify as deposits and will be covered under FDIC insurance if those funds have been placed at an insured depository institution.

   Consumer groups have expressed concern that holders of gift cards would lose out if the retailer that issued the card went bankrupt.

   According to the National Retail Federation, gift card sales totaled approximately $26.3 billion in 2007, up 6 percent compared with $24.8 billion in 2006. Nearly 55 percent of consumers say they would like to receive a gift card as a holiday present.

   Also, more here:

   If you purchase or are already holding a card from a store that has filed for Chapter 11, you’re considered an unsecured creditor, which could mean you may be holding a worthless piece of plastic.

   “I would say that all consumers just need to be wary,” said Cheryl Bridges, director of the Center for Retailing Studies at Texas A&M University. “If the company does go out of business, you have to be concerned about the fact that your gift card may not be valid.”

   Bridges and others emphasize that just because a firm is in Chapter 11 doesn’t mean it’s going out of business. Still, they advise consumers to look at a company’s financial records before buying gift cards.

   For publicly traded companies, Bridges said, you can get that information from the investors relation page on the businesses’ Web sites.

   Howard Davidowitz, chairman of Davidowitz & Associates a national retail consulting and investment banking firm in New York, offers this advice:

   “Well, here’s the secret. If you get a gift card, use it right away. If you keep it, it means you got a bank account without FDIC insurance.”
3. katmh November 22nd, 2008 at 4:55 pm «

   Can you tell me what your sources for this list are? I’m not doubting, just interested. Thanks!
4. JoyB November 22nd, 2008 at 5:59 pm «

   I got this email from Ann Taylor, and there is more about the scale of this at snopes: http://www.snopes.com/politics…..osings.asp

   I get the sensation that Ann Taylor will ride things out fine. I hope so–I like their clothes.

   Dear Valued Client:

   It has come to our attention that false and misleading information, regarding our Company and our store closure program, is circulating on the Web, as part of a hoax to scare consumers away from purchasing gift cards. Ann Taylor is a financially strong Company that operates nearly 1,000 Ann Taylor, LOFT, Ann Taylor Factory and LOFT Outlet stores across the U.S. In January 2008, we announced plans to close some underperforming stores, as part of a strategic restructuring program to make us an even stronger Company that can continue to serve you in the future. Our gift cards continue to be a popular and great option for gifting this Holiday season and can be redeemed at any of our stores, as well as online at anntaylor.com and anntaylorLOFT.com. We look forward to serving you again soon!

   Kay Krill
   President and Chief Executive Officer
   Ann Taylor Stores Corporation