Tuesday, June 14, 2011

What's in your wallet?

While cleaning out my wallet to organize my receipts, I couldn’t help but realize the amount of gift certificates that I carry around with me: Lululemon, The Keg, Second Cup, Tim Hortons, Sears, Forever 21, and The Running Room. These are either wonderful gifts that I look forward to spending or store credits from purchases gone bad. But then I started thinking, what if I didn’t want to shop at any of these stores? Take for instance my $50 at Sears – I cannot remember the last time that I even entered a Sears store so for all intents and purposes, this card might be wasted.

And it wouldn’t be the only one.

A reported 75% of Americans gave cards valuing $145 as gifts last Christmas and with a reported redemption around 10% - 19%, buying a gift card for someone gives more to the retail store than it does to the recipient. Check out this 2007 New York Times article from Freakonomics authors Stephen J. Dubner and Steven D. Levitt to read about Best Buy’s $16 milllion windfall.

I recalled reading about a Canadian company called CARDSWAP and decided to check it out. With Father’s Day approaching, I was hoping to swap my Sears card for a manly gift certificate like The Home Depot. My dad is difficult to buy presents for as he likes to spoil himself with elaborate additions for his at-home workshop. He is like Tim the Tool Man Taylor (but with fewer explosions) so a Home Depot card in his wallet would not go to waste.

It turns out that CARDSWAP is different than I expected, but I am going to try it anyways. Rather exchanging one gift certificate for another, the company writes you a cheque for up to 90% of the value of your card. All you have to do is register the card with them, pop it in the mail using a pre-paid shipping label, and wait by your mailbox for your money. While you do not get 100% of the funds, in a case like my Sears card I think it is worth it. I don’t have any intention to purchase something from the store and I’d rather have $41 to put in my Mad Money envelope.

On the flip side, if you are looking to buy a gift certificate, CARDSWAP will resell you someone else’s reject at a discount. They have taken the time to verify the value and guarantee it for 21-day. While there are no Home Depot gift certificates currently available, there are lots of good deals posted at the moment:

o       $50 at JackAstors for $39 (21% savings)
o       $100 at Cineplex for $75 (25% savings)
o       $100 at Fairmont Hotels & Resorts for $85 (15% savings)
o       $250 at H&M for $222 (11% savings)
o       $100 at The Brick for $89 (11% savings)
o       $106 at Danier Leather for $86 (19% savings)

I think this CARDSWAP is great idea if you are a regular at a particular retail store, saving up to make a bigger purchase, or planning a weekend away.

The only glitch at the moment is the postal strike by Canada Post so sending my Sears gift certificate in the mail seems a bit risky. I plan to wait until that is all settled and then, I’ll take my $41 to Home Depot (unless a Winners gift certificate happens to pop up on CARDSWAP first).

How many unused gift certificates do you have in your wallet? What do you think of the CARDSWAP concept? 


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