It turns out that even as many people struggle to stretch their earnings in the face of increasing inflation, they may be missing out on money they already have in the form of unused gift cards.
According to a recent CreditCards.com survey, 47% of consumers now own at least one unused gift card, voucher, or store credit.
The average unused amount per person is now $175, up from $116 the previous year. According to CreditCards.com, that may total $21 billion for the whole adult population of the United States.
Those numbers might provide customers’ wallets a much-needed lift in the midst of record-high pricing.
“It’s like finding that $20 bill in that jacket pocket from last winter,” Ted Rossman, senior industry analyst at CreditCards.com, made this statement. “But in this case, it’s even more money than that.”
Gift card holding can be a losing strategy for a number of reasons, according to Rossman. Inflation may cause the value of the remaining funds to decrease. The card can disappear or you might be hit with inactivity fees. It’s also possible that the store will close.
“There’s really no good that comes from letting these lie around,” Rossman said.
Tips for maximizing unused gift cards
The best case scenario is that customers will be able to use their unused gift cards in ways they will find enjoyable.
Rossman stated there are alternative methods to make use of the cards if you are unable to come up with something you desire.
List all of your unused gift cards as well as forthcoming occasions like birthdays and holidays. You might be able to use those amounts to purchase gifts for close friends or family members.
Rossman said that as an alternative, you could decide to sell your gift cards to businesses like CardCash, Raise, or ClipKard.
It’s crucial to keep in mind that these services frequently only recognize 70% to 80% of the initial amount, so the whole value may not always be honored.
The majority of gift cards are no longer subject to expiration. According to Rossman, if they do, regulations often forbid them from doing so before a five-year term.
However, some establishments impose inactivity penalties that reduce a gift card’s initial value. Furthermore, businesses like stores or restaurants could fail, making the money meaningless.
“My advice would be to use them, because they’re not going to be more valuable over time,” Rossman said.
Who has the largest balance on unredeemed gift cards?
Millennials were more likely than any other age group to have unused gift cards on hand (52%), with an average value of $226, out of the 2,372 persons who took part in the online survey in July.
Gen Z was the following generation, with an average amount of $149 and 51% of them having unused balances.
With 43% and 42%, respectively, of respondents in the Gen X and baby boomer generations failing to use gift cards, this is also a problem. For Gen Xers and baby boomers, the average underutilized value is $180 and $133 respectively.
According to household income, people earning between $80,000 and $99,999 had the highest likelihood of having unused gift cards (57%) with an average value of $227.
The next group of respondents, with an average value of $265 and a 56% share of those making above $100,000, were.
Less wealthy people have a lesser propensity to squander their money. Nonetheless, 53% of people with household incomes between $50,000 and $79,999 and 41% of those with household incomes under $50,000 reported having unused gift cards.
Unused gift cards typically have a value of $128 for households making under $50,000 and $165 for those making between $50,000 and $79,999 annually.