Spending Smart With Holiday Gift Cards

MINNEAPOLIS (WCCO) -- We know you're looking for the easiest and smartest ways to shop as we get closer to Christmas. This week, we are getting to the bottom of some of your holiday shopping questions.

Gift cards are perfect for the tough people to shop for on your holiday list, but you should watch out for hidden fees.

Financial analysts have seen gift card sales climbing every year the past five years. If you're not careful you can pay up to $7 in purchase fees for some gift cards.

WCCO talked with New York-basd credit card analyst Janna Herron. She says her company, Bankrate, found the fees happen most often with bank-issued gift cards.

They can be used almost anywhere but could cost you dozens of dollars extra if you're buying multiple gift cards.

Herron recommends going with a brand-specific card like for a restaurant or retailer to avoid fees.

Bankrate looked at 55 brand-specific cards and only found small fees for a few of them. Some bank-issued gift cards even deduct monthly fees for each month you don't use your gift card. Those are about $2.50 a month.

Federal laws recently extended the amount of time before your gift card expires. You have five years to use them up. Retail gift cards usually don't expire.