Why you should NEVER buy gift vouchersTweet
The gift voucher market is huge. Sales totalled £4 billion last year in the UK. That means that every man, woman and child in the UK spent on average £63 buying gift vouchers in 2011 – crazy!
Buying gift vouchers is strange when you think about it. You work hard in exchange for legal tender (which is accepted everywhere), you then use that money to buy a piece of paper for the same amount of money which has severe limitations and might not be honoured. I strongly disagree with buying gift vouchers and recommend you NEVER buy them again, these are the reasons why:
- It’s not a thoughtful gift – lets get this straight: Gift vouchers are not a thoughtful gift. They’re a lazy gift, just as lazy as cash, but not as useful. Just becuase it’s from the shop your friend / family uses, and comes with a small card doesn’t make it a thoughtful gift.
- It’s not as flexible as cash – if you give me £10 cash I can spend it on what I need from every shop or service – cash is universally accepted. But a gift voucher is limited to only the shop it came from, how crap is that?
- 6% of gift vouchers are never used, over £250m is wasted every year - Because they can only be used at certain shops and dont easily fit in my wallet, I leave them at home and they’re often forgotton about. And even other gift vouchers have perished in my wallet. Industry figures say UK consumers waste £250m on unused gift vouchers.
- Some vouchers have expiry dates – unlike cash which rarely expires (and even when it does you can exchange it for new money at banks). Many people don’t realise that gift vouchers expire because retailers put the expire date in very small print on the back.
- If a company goes into administration, receivership or liquidation they legally don’t have to honor gift vouchers – this doesn’t like a big issue, but with more and more retailers going into administration, it’s a growing problem. Recent casualties that didn’t honor their gift vouchers include HMV, Comet, Jessops, Game, Zavvi, JJB, Old Times, and many more. The combined total of vouchers which were not honored by these companies would be in the millions and maybe tens of millions. That is your hard earned cash down the drain, and the present you gave your family or friends is totally worthless. If you brought the gift voucher with a credit card, and it wasn’t honoured, you might be able to claim your money back from your credit card company. But the chances are, you gave the vouchers as a gift and have totally forgotten about them.
- They are made of “normal” paper that deteriorates and might become unusable – I’ve got a gift voucher in my wallet, which is less than a few months old, and has already fallen apart. Cash is made of special high-grade paper which includes cotton, this makes it very hard-wearing and banknotes can survive years of use and even accidents like being washed in a washing machine. Gift vouchers on the other hand are not hard-wearing and can easily perish and become worthless.
- You can’t earn interest on gift vouchers – you can’t earn much interest on cash either at the moment, but once banks start paying interest again this will be another reason not to give gift vouchers. Imagine you just got married and got a bunch of gift vouchers for your wedding, they might just sit in a draw for a year or two while you save up to buy your own house. If you had been given cash you could deposit the money into the bank and earn interest in the meantime.
- Some retailers give change from gift voucher purchases in more vouchers – you give your aunty a £20 gift voucher, she buys herself a £17 scarf and gets £3 back in paper vouchers or onto a gift card. There is a good chance that she won’t go back and spend the remaining £3 as there is nothing she needs from that shop or there is nothing in that shop for around £3.
- Some retailers won’t let you use gift vouchers at their own online websites – this is not only inconvenient, but it can also mean you pay more. Often retailers have “web only” deals on their website which you wouldn’t be able to take advantage of.
In summary, give friends a thoughtful gift (but if you can’t think of a suitable one give them cash), but never give them a gift voucher!
Don’t just take my word for it, Martin Lewis from Moneysavingexpert fame, says…
“If you are giving a gift, then cash is the ultimate rewards point scheme. It can be used on anything.”