With the first quarter of 2010 coming to an end this week, it is only a matter of time before the new gift card rules take effect. Part of the Credit CARD Act of 2009 and scheduled to kick in mid August, 2010, the Federal Reserve Board announced last week the final rules that apply to gift cards. The rules protect consumers from certain unexpected costs and require that gift card terms and conditions be clearly stated. set new national rules to both single-store cards, such as Best But gift cards and the Amex/Mastercard/Visa general-use gift cards which can be used anywhere.

While these new rules will be extremely helpful for the American consumer, a number of these rules may be in effect, depending on what state you live in. Throughout this article we will highlight a few examples, but for the full list, make sure to visit the Consumer Union break down.

National Rules:

First, lets review the new national rules. These rules prevent gift cards from expiring before 5 years and eliminates any fees, unless the card has seen no activity for up to one full year. If you end up hitting that 12 month market of inactivity, no more than one fee can be charged per month; and card companies must provide clear and conspicuous disclosures about the fees. It is important to note that the level of fee is at the discretion of the issuer and therefor you should pay close attention at what those fees are when selecting a gift card.

State Rules:

Remember, the new national rules do not go into effect till mid-August, so understanding your State projection laws could save you a few dollars till then and after. In reviewing the list of States, it seems some are more aggressive then others. For example, in New York, expiration or fees, or other terms and conditions must be clearly and conspicuously stated on the card, package, or accompanying printed document with toll free number. Where in California, gift cards cannot have a expiration date and no fees, except when cards have a balance of $5 or less, OR has not been used for 24 months.

It is also important to note that a number of States do not cover all types of cards, for examples; Arkansas does not cover cards linked to bank accounts usable with multiple unaffiliated merchants or prepaid calling cards. There is also unique redeemable scenario’s like the one in Massachusetts, where unreloadable cards that have used 90% of the value may obtain the remainder in cash.

With the next big shopping event still a while away, now is the time to freshen up on your knowledge of gift card rules, so you can make smart money saving decision when the time comes.

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  • VictoriaJDaoud

    Oh and when I did talk to someone about the extended overdraft fee I was charged, they asked if I made the purchase as debit, because that could be why. Well, I didn’t just get off the boat yesterday, so no, I told her it was credit, which it was. I asked her how I could even get an extended overdraft fee if the original overdraft fee was waived, she couldn’t answer that question at all. What I hate the most is that they never let me go talk to an actual banker or even a bank manager about these problems. The bank tellers always want to try to take care of it themselves, but they don’t explain things, because they don’t understand it themselves. Any other bank or credit union I’ve ever dealt with has directed me to wait for someone in one of the offices, that way I could talk about my problems with them and we can look at the computer screen together. Here, it’s like they want to keep everything a secret, won’t show you what they are seeing, and want to take care of everything themselves, even if they have a huge line of people and don’t know what they’re talking about.

    I don’t mind overdraft fees when I know when and why I’m getting it. But as I said before, I have never had this many overdraft fees ever, especially not in a short period of time. But to get overdraft fees when they shouldn’t happen, that’s frustrating, but the kicker is that no one knows anything and won’t do anything about it in the end.

  • justaknow

    make sure that when you do spend money you do not have currently in the account that when you do make the deposit, you do NOT use your card or make sure NO other electronic transactions go thru that WHOLE NEXT DAY that re-overdraw your account. you will be charged the original OD fees. better yet, if you do not have the money currently in there, unless there is blood gushing or something, don’t spend it. grpceries can wait 6-10 hrs. everyone has soup or crackers or something in the cupboard.

    • VictoriaJDaoud

      I never reused my card, I have been with other banks in the past and I know that you can re-overdraw an account. I think food for myself and others in the household is a bit important. As I was always taught, make sure you have food and a roof over your head before you worry about other things.