Gift Cards: What You Should Know
From Michael W. Frerichs, Illinois State Treasurer
One of the lesser-known roles of the Illinois State Treasurer’s Office involves gift cards.
Some unused gift cards after a certain period of time are considered unclaimed property. As such, the value of these cards is surrendered to the treasurer’s office.
There is big money in these cards. Barron’s reports that shoppers purchased $130 billion in gift cards in 2015. However, the surrendering of these cards to the treasurer’s office means that someone has been deprived of their use. That is why we offer the following advice:
- Know that the two most common types of cards are retail gift cards and bank gift cards. Retail gift cards only are redeemable at the specific retailer or restaurant that issued the card. Bank gift cards, which carry a payment network such as American Express or Visa, can be used at any location that accepts that specific brand.
- Resist the urge to save the card for a rainy day. Doing so may increase the likelihood that some of the card’s value will be consumed by fees. Instead, use the card and set aside an equal amount of cash for a rainy day.
- For example, consider that while money on a typical gift card cannot expire for at least five years, depending upon the circumstances, inactivity fees can begin in as little as 12 months. Therefore, it is possible that inactivity fees could consume the cash value of a card before the five year window has expired.
- When purchasing a gift card, buy from a known and trusted source. Be wary of online auction sites. Read the fine print to determine if there are shipping or handling fees.
- Consider the company’s location and reputation before purchasing. A retail gift card for someone who does not live near a store’s location might not be convenient. Also, a store that files for bankruptcy or goes out-ofbusiness might not accept a gift card.
- Treat a gift card like cash. If lost or stolen, report it to law enforcement. Contact the card’s issuer to determine if a replacement card is possible and at what cost.
Today, the state treasurer’s office holds more than $2 billion in unclaimed property. Because records are updated twice each year, residents are encouraged to frequently check the Illinois State Treasurer’s Ofiice I-Cash database.
The office never charges a fee to search for, or return, unclaimed property.