Gerg Stanton, founder of Money Saving Expert and a renowned financial expert, has warned Christmas shoppers in the latest issue of his newsletter to avoid buying gift cards and loans. With Christmas holidays approaching and less than 100 days remaining, Stanton emphasizes the importance of financial planning and points out that cash is a better option than gift cards.
Risks of Buying Gift Cards
In his list of 15 saving tips, Stanton highlighted the risks associated with gift cards. He points out that 43 percent of Britons choose these gifts for their loved ones every Christmas. However, he emphasizes that gift cards carry their own specific risks.
He says, "Many people think that giving a gift card is more socially acceptable than giving cash. But unfortunately, gift cards often become worthless if the store goes bankrupt, which literally means you have lost your money."
Unpleasant Experiences for Shoppers
This issue is not limited to small businesses. Last year, major retailers like L K Bennett and Quiz went bankrupt, causing gift card shoppers at these stores to face serious challenges. Stanton also pointed out that bankrupt managers can decide at any time not to accept gift cards anymore, which adds to shoppers' concerns.
Stanton also advises consumers that if they purchase a gift card, it may lose its value if not used for a long time. In a study conducted, over one-tenth of British adults reported that they left gift cards unused last year, with each person losing an average of about £75.30.
Stanton's Suggestion: Cash is the Best Option
Given these issues, Stanton advises shoppers to "carefully consider the financial stability of the retailer you are buying from and how quickly these cards will be used. When in doubt, cash (or money in the bank) is the best option — it is completely flexible and can be used anywhere."
Finally, Stanton pointed out an important issue regarding the expiration dates of gift cards, stating that these dates are often not clearly communicated. For example, the expiration date for Amazon gift cards is 10 years from the date of issue, while other stores may have different dates. This can lead to unnecessary financial mistakes, and as a result, shoppers should be more careful in choosing gifts.
