Recession-proof gift cards?
A favorite stocking stuffer is causing concern this holiday season. With household name stores like Circuit City and Linens-N-Things filing for bankruptcy, is it safe to gift a plastic IOU from any chain?
The short answer is no one really knows.
You could read warning signs in what happened when the Sharper Image went into bankruptcy. Customers holding $43-million in Sharper Image gift certificates were largely out of luck, until a bankruptcy judge agreed to permit the certificates -- but only under less than ideal circumstances.
Could it happen again? Some reports suggest it's a worry. But on behalf of those who relish gift cards over useless trinkets, here are some ways to continue gifting them.
- Consider a gift certificate to a mall or shopping center, rather than a single store.
- Amex, Mastercard and other major credit companies offer lines of pre-paid plastic, a.k.a. gift cards that are good anywhere on anything. Just make sure the user fees aren't excessive.
- Cash or savings bonds may seem like quaint gifts, but they've worked for years.
The best way to avoid getting stuck with worthless credit? Spend you gift card sooner rather than later.
-- Deal Diva Letitia
(Photo: Times archives)