The Shuffle: How To Make The Best Out Of Those Gift Cards.

 

A version of this writing appeared on Nerdwallet.com, Money.com & NASDAQ.com.

Every year a staggering $1 billion in gift card balances remain unused according to www.cardhub.com.

No wonder retailers love them. They rack up the sales.

Consumers get shortchanged by their own actions!

This year it’s time to be smarter and maximize the use of gift cards.

Here’s how:

Spend the entire balance at once. Consumers want their gift cards to last as longer as possible. We have a strong tendency to ‘hoard’ balances until we forget the card, lose track of the balance or the card expires.

Unlike having a saving or spending discipline, this is your time to SPLURGE.

splurge

Spend the entire balance at once. At a single location. Make a list of what you plan to purchase and go for it.

Go over the line. Here I am a money guy advising you to spend! Don’t attempt to be too cute and come in at or under the limit of the gift card. Remember your goal is to spend every dollar and not add to the $6 billion in unused balances. Set a boundary. I recommend 10-15 dollars above the limit to assure you’ve fully exhausted the balance.

Employ a smartphone partner. Through the free RAISE app you can sell your gift card balance (for a discount). Also, before you shop a favorite retailer check RAISE first to see if discounted gifts cards are available.

For example, I had a client find a $100 gift card to Home Depot for $65.

What a deal! Use gift cards year round to shop.

Request or send eGift Cards. Trash the plastic! EGift cards are electronic gift cards delivered through e-mail, text, social media or mobile applications. Most digital gift cards can be used in stores.

They’re easy to send, receive, and most important your balances can be tracked real time which means you’re more likely to spend your balances in full.

Check out www.giftcards.com, a comprehensive hub of information on how EGift cards work, how to personalize them, how to redeem and which ones top-ranked.

Set your own gift card expiration date. Forget the expiration date mandated by the issuer (yes, gift cards may have expiration dates). Set your own. I suggest no longer than one month from the date the gift card was received otherwise the odds of a balance going unused forever increases greatly.

Once your personal expiration date has been reached, sell your balance at www.cardcash.com. Recently, I reached a personal expiration with a $50 Kohl’s gift card. I sold it for $41.

Just follow three steps to get an offer, submit your gift card information, receive money once the order is confirmed and the card’s balance is verified. Quick and easy.

Over $138 billion is spent annually on gift cards. Sales are expected to grow at least 6% annually through 2017 according to the latest CardHub statistics on the gift card market.

So, a gift card balance should never go to waste again.

Not on your watch, anyway.

on watch

Year-End Financial Planning Tips. And a Life Lesson.

Another year.

Gone.  

2013 is history.

Well, almost.

I’m glad.

For me, it is a year to forget. Too much physical, financial and mental anguish.

But their were (are) lessons.

Always. Lessons.

A friend I lost this year asked me – “Must everything be a lesson?”

Well, duh.

lesson

Now I understand why she’s a former.

Let’s wrap up 2013 (good riddance) on a solid financial note.

Here’s how.

Random Thoughts:

1). No need to rush – Among your employer benefits choices, there’s an account you direct money into each pay check. It’s called a “Flexible Spending Account” or FSA for short.  It’s a good thing because it allows you to pay for qualified medical expenses using pre-taxed dollars.  At the end of the year, many of us are in a mad scramble to spend the remaining proceeds in an FSA because it’s been a “use it or lose it” situation. In other words, if you didn’t spend the money before the end of the year, you lost it. Not anymore.  In October the U.S. Treasury Department relaxed the rules. Employers now are able to allow participants to carry over up to $500 in unused funds into the following year.

2). Are you charitable? – The qualified charitable distribution expires at the end of 2013. If you’re at the age where you’re taking required minimum distributions from your retirement accounts, you can still receive a deduction for donations you make directly to qualified charities. Consult a qualified tax adviser to take care of this one. Depending on your household income, you may benefit greatly from implementing this strategy.

3). Clean up. Now is the time to get financially organized.  Consider shredding all financial and tax documents greater than ten years old. The rest of your documents should be organized and placed in binders with tabs.  Make sure to communicate the location of important documents to those who help you make financial decisions or those who would be there if you become temporarily disabled.

4). Rebalance your portfolio. Have you ignored your 401(k) investments? Are you cash heavy? Many investors are.  Meet with an independent financial advisor for a written plan customized for you. Speak to a representative of your employer-provided plan about something called “auto-rebalancing” where investments are bought (low) and sold (high) at least on an annual basis. Work to increase retirement savings by 1% from the first pay you earn in 2014.

5). Review your holiday spending.  At the end of each year, I do a brutal self-assessment to determine how and why I perhaps went over budget and compare my spending to the previous year. For some, this is a wake-up call as you become accountable to yourself for overspending.

It appears American consumers have become smarter about taking on debt during the holidays based on a recent survey by the Certified Financial Planner Board of Standards.

New Survey Reveals American Holiday Traditions: Financially Smart Gifting and Receiving.

6). Write your two-year plan.  AJ Leon, an inspirational character who classifies himself as a “misfit” has figured out how to get the most out of life. His essays in a body of work titled The Life and Times of a Remarkable Misfit, are inspirational and more. If you seek to change your perspective, the free download is a must read.

AJ asks you to become accountable to yourself, your dreams. Write at least 500 words about where you want to be in two years. Once complete, send that gut-wrenching piece of work in an e-mail to someone who will hold you accountable. Now your aspirations are out there. Exposed.

You’re committed.

There’s no going back.

And 2014.

Will be it.

Yours.

The year you waited for your entire life.

brass ring

Go for it.