It would be great to receive goods and services without spending a penny. But even if you wouldn’t spend money, you would need to make a transaction. Gift cards are one of the few methods to perform such transactions without spending your money, at least not at the time of purchase.
Whether you already know what gift cards are or already know how to acquire them, a pervasive problem is choosing the right type. This article will answer this question by also defining some basic concepts about what gift cards are and why they are used.
What are gift cards?
The name might be a bit misleading. A gift card is not necessarily something that you give to someone as a present, although it’s a frequent use of them. Instead, we ought to think about them as stored value cards, much like currency. It’s a form of payment that can be used at one or multiple stores.
An open-loop gift card is much like a pre-paid debit card. They are issued by banks or payment card providers, such as Visa or MasterCard. Such gift cards can be used anywhere where ordinary payment cards of the type are accepted. In some cases, they may even be cashed out for ordinary currency or topped up.
Closed-loop gift cards, on the other hand, can only be used at a specific merchant. Sometimes, even one specific store of that merchant. For example, Walmart’s gift card would not work in Costco. You get a specific amount added to your gift card and must spend it in that store.
The biggest drawback of both types of gift cards is that they have an expiration date. You must spend the amount in due time. Otherwise, it will be lost.
The biggest benefit of them is that taxes are already paid, and the person receiving the card can simply spend it on what he wishes. It makes gift cards a convenient option for various online platforms and as gifts.
How to get gift cards?
While there are countless ways to acquire gift cards, we can categorize them into three groups. This is far from an exhaustive list, but it will give you an idea of when to expect and even start looking for gift cards.
The standard gift scenario is well-known to most. You don’t know what to gift to your friend, so you simply buy a gift card for a reasonable amount. However, gift cards are often given away in such a way by employers as compensation for your trouble with some service.
Gift cards are also often used as a means to promote a service. The idea is that if you receive a gift card for a couple of dollars, you get a chance to visit a certain store, likely leading you to spend even more money. It also raises brand awareness, as now you’ll tell all your friends that you got something for free.
Online side hustles are where it gets interesting. There are hundreds of ways to earn small side money on the internet. They are all quite insignificant to go through paying taxes and banking fees, so gift cards are a great alternative.
Some of the most common methods to earn gift cards are filling out paid surveys, testing websites and software, sharing your internet bandwidth, receipt scanning, participating in cashback platforms, playing games, and watching ads. I’m sure that a quick Google search will reveal many more methods to earn online gift cards in exchange for a bit of your time.
Best value gift cards by type
No matter which scenario you find yourself in, you should know which gift cards are the most valuable. Some gift cards are very rarely used, and you might get into technical problems. Others simply don’t bring enough value, and you’re better off with cash.
Travel gift cards
Gift cards related to travel expenses, such as fuel, accommodation, taxi fares, or flight tickets, are the most valuable ones. The reason is that you are likely to spend them abroad for services priced in another currency with different taxes.
For example, a Circle K digital gift card I received from online surveys worked not only for groceries in the US but also when fueling my rented car in Europe. I would have likely paid much more if I had to use my bank card there.
Food delivery gift cards
Ordering food at home is so convenient that I caught myself spending almost half of my income on it. Acquiring gift cards for Uber Eats and other delivery services helped me better manage my expenses for this luxury.
If I do not have any gift cards in my account, I simply make a meal myself. Besides budgeting, food delivery gift cards are valuable because they are very easy to spend.
Gift cards for groceries
Grocery shopping is something we spend a lot of money on each week. Grocery gift cards offer one of the best ways to save money without feeling the toll of eating less or cheaper food. But the grocery store gift cards, if you choose the ones near you, have the best value because you will most definitely spend them.
Gift cards for digital subscriptions
Netflix, Spotify, Xbox Live, you name it. We all have subscriptions that eat our monthly budget and aren’t essential. Instead of cutting them out when saving, you can acquire some gift cards and have a fixed amount you spend on them. Even better if you are acquiring these cards for free.
Wrapping up
The last thing that must be mentioned about gift cards is that there are a lot of dishonest platforms and individuals using them to scam people. Be aware that you won’t get hold of them without putting in any effort, and steer away from schemes that ask you to pay money. Most other methods of acquiring gift cards are fair games that will increase your budget.