Jump Up and Down: You've Got Rights!

You’ve been there. A holiday, birthday, or anniversary is looming ever closer. You’ve been trudging around department stores all day in a haze, unable to find that perfect gift. Then you see the gift card rack like a desert mirage. Perfect. Not tacky like cash, and requiring only general knowledge about your giftee. You pick up a few and happily head home.

Undoubtedly others you know have gone through a similar process and you may find yourself heavy laden with gift cards. If any of these were purchased after August 22 of 2010, then there are some new rules you need to know about.

First of all, these new rules and protections (fashioned by the Federal Reserve) apply to store gift cards and gift cards with a MasterCard, Visa, American Express, or Discover brand logo. Unfortunately, the new rules only apply to gift cards. If you have a reloadable prepaid card that isn’t intended for gift giving purposes or cards that are given as a reward or part of a promotion, they are not covered. But it’s okay. Chin up.

So, how are you, the consumer, more protected now? For starters, any and all fees have to be clearly disclosed on the card itself or the packaging. And start jumping up and down, because many of these fees are now limited. Silly nonsense like dormancy fees for not using your card, or usage fees for actually using your card are now restricted. After all, it makes sense not to charge you for both using and not using your card. There are also restrictions on fees for adding money to your card as well as maintenance fees. You may still be charged fees if you haven’t used the card for at least a year, and you are only charged one fee per month. You can also still be charged a fee to purchase the card, as well as fees to replace a lost or stolen card. Now, you may not want to, but it can save you a lot of money to take the time to read through the card disclosure before buying it.

Here’s another useful tidbit. If your card has expired, you may still be able to use any unspent money by requesting a replacement card at no charge. Sometimes the money expires later than the card itself.

Lastly, any money on your gift card is good for at least five years from when it was purchased. Any added money is good five years from the date it was added.

So, now you can let that special someone know that not only do you care enough to provide them with prepaid money to their favorite store, you love them enough to let them know about their consumer rights!