Bankrate gift card survey: Consumers need to be wary -- page 2

Another trend in gift cards is the flexibility to choose the amount to put on the card. Relatively few of the issuers contacted by Bankrate.com only offered cards in set denominations; most allow the purchaser to decide how much to put on the card, within a range, such as $5 to $500.

There's also a very strong trend toward "open system" cards from credit card issuers and malls, giving cardholders a much wider range of options in where to use them and the ability to replace lost or stolen cards. If you have a receipt from your most recent purchase, it will have the gift card number on it. As our research found, many retailers will issue a new card for the amount that's remaining. There may be a fee for that service, though.

The practice of giving gift cards has exploded. That's a big change in itself; they used to be last-resort gifts, something grabbed at the last minute because people couldn't think of anything else. Called the lazy-man's gift, they were one step above handing a person money, which in many gift-giving circles is considered crass.

No more. Americans have embraced gift cards with a big materialistic hug. The National Retail Federation reports that three-fourths of us will buy at least one gift card this holiday season, spending a total of $17.34 billion, up $100 million from last year. The average person will buy three cards, most often for relatives outside their immediate family, spending a total of just over $100.

Plus, they're not afterthoughts. A survey commissioned by Louisville, Ky.-based Stored Value Systems found that more than two-thirds of gift card purchases are planned.

"We used to think gift cards were what you did if you couldn't think of anything else; it's the least imaginative thing to do," says Samuels. "Now it's the first choice. Teens love these things ... Last year, we asked, why do you get a gift card? People said, 'I want them to get exactly what they want.'"

Gift card recipients are doing just that. According to the SVS survey, 42 percent of consumers use gift cards within a month of receiving them. Only 4 percent still have them sitting in a drawer unused a year later.

That's a good thing, Horne says, because it's the whole reason you got one in the first place.

"People who get them need to spend them because that's what the giver wanted you to do," Horne says. "Don't wait. Spend it. Enjoy it. Buy yourself something nice. Then you don't have any of these issues come up."