Avoiding Gift Card Scams

Gift cards are a popular holiday gift, but be careful. Gift card scams are the new fad out there in the world of financial frauds.

The National Retail Federation says that gift card sales increase in the billions each year. Most people spend $30 or more on gift cards that they give as holiday presents. Many people don't realize that the gift they are giving might be part of a scam.

One very popular scam involves people copying the gift card numbers that are hanging on the store racks. They then call the retailer's 800 number to check on the balances for the card numbers they have copied. When the cards are purchased and activated, the thief uses the card number to buy items online.

There are also many fake gift cards floating around out there. These have been stolen. You buy them online and give them as a gift only to find that they had never been activated.

When considering gift cards as a holiday gift, keep these tips in mind:

• Buy gift cards from the store or retailer's secure website. Do not buy gift cards from a third party or an auction site.
• When you purchase a gift card from a physical store, make sure that you carefully examine both sides of the card. Make sure that it hasn't been tampered with. The PIN number should not be exposed. If you are unsure, do not purchase the gift card.
• Make sure that you hold onto your receipt. This is your proof of purchase. If the card was compromised and was unable to be used, many retailers will replace the card for you.
• Once you have bought a gift card in the store, ask the cashier to scan the card to ensure that it is valid and reflects the balance you just added to the card. This ensures that you are giving exactly what you paid for.

Gift cards are an excellent gift option for the holidays and other events. It is easy to stay within your budget when you simply purchase gift cards for everyone. And they do show thought if you choose retailers that are of specific interest for the intended recipient. For example, a hunting and fishing store for dad, a quilt shop for mom and a toy store for junior. It saves you money, time and being jostled around by other holiday shoppers.

All you have to do is determine how much you want to spend towards each person on your list. This is easy. Make a list of everyone that you want to puchase items for. Then look to your budget for how much you are able to spend on holiday shopping. Then simply divide the number of people into the total you want to spend. This gives you the amount you can spend on each person's gift card. It couldn't be any more simple.