/PRNewswire/ -- If you got a rebate from holiday shopping this year, there's a good chance it came in the form of a rebate card. More and more retailers are switching from issuing rebate checks to providing rebates on prepaid cards that look like gift cards. But rebate cards come with fees and other restrictions that can diminish their value, according to Consumers Union, the nonprofit publisher of Consumer Reports.
"The switch to issuing rebates on plastic is saving retailers money but consumers stand to lose out to a host of fees that can eat into their rebate savings," said Michelle Jun, staff attorney with Consumers Union. "Consumers should be sure to read the fine print carefully when they get a rebate card to make sure they end up getting the full rebate they were promised."
Retailers issued $4.24 billion in rebates on rebate cards in 2008, according to Mercator, a market research consulting firm for the prepaid card industry. That represents a 53 percent jump from the previous year and industry analysts expect that trend to pick up in the coming years.
While rebate cards resemble gift cards, they aren't governed by state laws and a new federal law that limit fees and quick expiration dates on gift cards. The Credit CARD Act of 2009 prohibits gift cards from expiring before five years from the date of purchase or when money was last loaded onto the card. Gift card issuers are barred from charging fees for the first 12 months. These federal gift card protections will go into effect in August and stronger state protections will remain in effect.
Rebate cards come in two forms: "closed-loop" cards that can only be used by the retailer that issues it and "open-loop" cards issued by Visa, MasterCard, American Express or Discover. These "open-loop" cards can be used anywhere the card network is accepted. In most cases, the only way to redeem the funds on a rebate card is to buy something else. Rebate checks, on the other hand, can be deposited into a bank account.
To help consumers avoid problems with rebate cards, Consumers Union issued the following tips:
Watch out for rebate card fees: Like other prepaid cards, rebate cards can come loaded with fees, including fees for activating the card, checking balances, inactivity, going over the limit, or replacing a lost or stolen card. Be sure to read the fine print when you receive a rebate card to become familiar with the fees you might be charged so you can avoid them.
Keep an eye on rebate card expiration dates: Many consumers have a tendency to hang onto gift cards instead of spending them right away. That could be a big mistake with a rebate card since it might expire quickly. Some rebate cards expire in as little as three months. The best advice is to check the expiration date when you receive a rebate card and spend it before it expires or you accrue other fees.
Know your balance and avoid problems at the check-out: Rebate cards can sometimes be difficult to use if the funds on the card don't cover the full amount of the purchase. To avoid this problem, keep track of the balance on your card and ask the merchant to make a "split tender transaction" so you can use the rebate card and some other form of payment to cover the full amount. Unfortunately, not all cashiers know how to process these kinds of transactions, which can make redeeming your rebate card unnecessarily frustrating.
Be aware that your rights may be limited if your card is lost or stolen: When rebate cards are lost or stolen and used by others to make fraudulent transactions, consumers are not protected by the same regulatory and statutory safeguards that enable debit card users to recover their money. If a consumer contacts a card issuer about a lost or stolen debit card within two business days, the consumer's liability is limited to up to $50 (or up to $500 if the consumer reports the debit card lost or stolen after two business days). By contrast, rebate cards may only have voluntary protections that could be revised or rescinded at any time for any reason.
"It's time for the law to catch up with this latest form of plastic payment so consumers don't end up losing their rebate savings to hidden fees and short expiration dates," said Pamela Banks, policy counsel for Consumers Union. "The emergence of rebate cards is a perfect example of why we need a Consumer Financial Protection Agency (CFPA) so that government regulators can respond more quickly and effectively to problems created by new financial products."
Last October, the House passed financial reform legislation that includes the creation of the CFPA, which would be charged with making sure that financial products and services are more transparent, fair and understandable for consumers. The CFPA will have the power to write and enforce rules, to fill the gaps under specific existing consumer protection statutes, and also anticipate and prevent harm to consumers from new products and practices. The Senate is considering a similar proposal.
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Showing posts with label gift. Show all posts
Showing posts with label gift. Show all posts
Tuesday, January 12, 2010
Monday, December 21, 2009
Consumer Reports: Avoid Return Gotchas Before Buying a Gift
/PRNewswire/ -- Even the most fool-proof gifts are subject to returns. In fact, 19% of people plan on returning a gift after the holidays, according to a recent Consumer Reports poll. But returning items may not be as easy or affordable as in years past. Holiday headaches will last long after the season is over, as return shipping costs, restocking fees and other gotchas prevail.
Most retailers have perfectly reasonable return policies, but some are better than others, according to Consumer Reports senior editor Tod Marks. "With so many stores selling the same or similar merchandise, where you buy can almost be as important as what you buy," said Marks, who pens the "Tightwad Tod" shopping blog on www.ConsumerReports.org. "However, there is good news: Most big retailers will generally accept returns on merchandise purchased between November and Christmas through the end of January."
Hassle-free return tactics
Because even the best gifts don't always fare well with recipients, it's best to be prepared before the purchase is made. Check privacy policies and terms of agreement, not just the returns section of a retailer's site. Consumer Reports also recommends shoppers should:
-- Get a receipt or gift receipt. Despite longer grace periods, retailers
are becoming more insistent on a receipt in order to get a refund, and
they're more inclined to turn away customers without proof of
purchase. Without a receipt, they may offer a store credit for the
lowest price the item sold for.
-- Keep packaging intact. Stores are likely to refuse a return if the
packaging materials are open or discarded. Even a missing instruction
manual, cords and cables or warranty card can give retailers reason to
deny the return.
-- Be wary online. Don't just throw it in a box and mail it back. Online
returns usually require a packing slip (typically included in any gift
order), and a return authorization number. Call ahead to ensure that
all requirements are being met.
-- Don't break seals or cut out UPC codes. Items like computer software,
video games, CDs and DVDs aren't generally returnable for another
title after the seal has been broken. If an item comes with a rebate
offer, make sure it works before removing the UPC code to redeem the
rebate.
Don't get stuck paying restocking fees
A restocking fee is a fee imposed on a consumer who returns an item. It covers the cost of processing the return, the costs associated with returning the item to the store's shelves, and any lost revenue as a result of the store's inability to sell that item as new. More products carry a restocking fee if the package has been opened, but if the item is defective before it's used, the store should not charge a restocking fee.
Typically fees range from 10 to 15 percent of the purchase price. Items more likely to have restocking fees include camcorders, TVs, digital cameras, and computers; however Consumer Reports found some not-so-hot returns policies that harbor a variety of restocking fees, including:
-- Amazon.com: 15% restocking fees for computers and fine jewelry.
-- Best Buy: 15% restocking fees on laptops, camcorders, digital cameras
and GPS navigators.
-- Bidz.com: 15% restocking fee on all items. Plus shoppers have only 15
days to return items.
-- Sears: 15% restocking fee applies to electronics products returned
without the original box, used, and without all of the original
packaging. The penalty also applies to some other products.
-- Home Depot: special-orders and some cancelled orders are subject to a
15 percent restocking fee.
-- Macys: 10% restocking fee on furniture.
-- Newegg.com: 15% restocking fee on all major purchases if the box is
opened.
The bottom line when it comes to restocking fees: Don't open the package unless there is no possibility of a return.
The best policies
Consumer Reports scanned various policies at a number of notable retailers and found the return period ranged from 30 days to as many as 180 days. Standout retailers to make Consumer Reports' list for best policies include Bed, Bath & Beyond, Bloomingdale's, Costco, Ikea, Kmart, Kohl's, Lowe's, Nike, Nordstrom, Piperlime.com, Sam's Club, and Shoebuy.com.
Some chains offer exemplary policies year round including Orvis, LL Bean, Land's End, and Zappos. All four retailers will take back unwanted merchandise, no questions asked. Zappos gives you a year to decide and asks that the goods be returned in their original packaging and condition. The others simply say you can return anything at any time for any reason.
Major retailers: what to expect
Wal-mart allows for 90 days for a full refund, except for electronics (it's 15 to 45 days depending on the gadget). Target grants 90 days for a refund with a receipt (some electronics have a 15% restocking fee). An even exchange is offered without a receipt, up to $70 worth of merchandise within a year.
Sears has a 90-day refund or exchange policy for most goods, 30 days on electronics, customized jewelry and other items including mattresses. Macy's has a number of limitations on items from furniture to jewelry.
Online retailers like Amazon.com and Overstock.com have strict limitations on what can be returned. For example, Amazon does not allow computers to be returned after 30 days and Overstock doesn't accept returned TVs over a certain size.
-----
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Most retailers have perfectly reasonable return policies, but some are better than others, according to Consumer Reports senior editor Tod Marks. "With so many stores selling the same or similar merchandise, where you buy can almost be as important as what you buy," said Marks, who pens the "Tightwad Tod" shopping blog on www.ConsumerReports.org. "However, there is good news: Most big retailers will generally accept returns on merchandise purchased between November and Christmas through the end of January."
Hassle-free return tactics
Because even the best gifts don't always fare well with recipients, it's best to be prepared before the purchase is made. Check privacy policies and terms of agreement, not just the returns section of a retailer's site. Consumer Reports also recommends shoppers should:
-- Get a receipt or gift receipt. Despite longer grace periods, retailers
are becoming more insistent on a receipt in order to get a refund, and
they're more inclined to turn away customers without proof of
purchase. Without a receipt, they may offer a store credit for the
lowest price the item sold for.
-- Keep packaging intact. Stores are likely to refuse a return if the
packaging materials are open or discarded. Even a missing instruction
manual, cords and cables or warranty card can give retailers reason to
deny the return.
-- Be wary online. Don't just throw it in a box and mail it back. Online
returns usually require a packing slip (typically included in any gift
order), and a return authorization number. Call ahead to ensure that
all requirements are being met.
-- Don't break seals or cut out UPC codes. Items like computer software,
video games, CDs and DVDs aren't generally returnable for another
title after the seal has been broken. If an item comes with a rebate
offer, make sure it works before removing the UPC code to redeem the
rebate.
Don't get stuck paying restocking fees
A restocking fee is a fee imposed on a consumer who returns an item. It covers the cost of processing the return, the costs associated with returning the item to the store's shelves, and any lost revenue as a result of the store's inability to sell that item as new. More products carry a restocking fee if the package has been opened, but if the item is defective before it's used, the store should not charge a restocking fee.
Typically fees range from 10 to 15 percent of the purchase price. Items more likely to have restocking fees include camcorders, TVs, digital cameras, and computers; however Consumer Reports found some not-so-hot returns policies that harbor a variety of restocking fees, including:
-- Amazon.com: 15% restocking fees for computers and fine jewelry.
-- Best Buy: 15% restocking fees on laptops, camcorders, digital cameras
and GPS navigators.
-- Bidz.com: 15% restocking fee on all items. Plus shoppers have only 15
days to return items.
-- Sears: 15% restocking fee applies to electronics products returned
without the original box, used, and without all of the original
packaging. The penalty also applies to some other products.
-- Home Depot: special-orders and some cancelled orders are subject to a
15 percent restocking fee.
-- Macys: 10% restocking fee on furniture.
-- Newegg.com: 15% restocking fee on all major purchases if the box is
opened.
The bottom line when it comes to restocking fees: Don't open the package unless there is no possibility of a return.
The best policies
Consumer Reports scanned various policies at a number of notable retailers and found the return period ranged from 30 days to as many as 180 days. Standout retailers to make Consumer Reports' list for best policies include Bed, Bath & Beyond, Bloomingdale's, Costco, Ikea, Kmart, Kohl's, Lowe's, Nike, Nordstrom, Piperlime.com, Sam's Club, and Shoebuy.com.
Some chains offer exemplary policies year round including Orvis, LL Bean, Land's End, and Zappos. All four retailers will take back unwanted merchandise, no questions asked. Zappos gives you a year to decide and asks that the goods be returned in their original packaging and condition. The others simply say you can return anything at any time for any reason.
Major retailers: what to expect
Wal-mart allows for 90 days for a full refund, except for electronics (it's 15 to 45 days depending on the gadget). Target grants 90 days for a refund with a receipt (some electronics have a 15% restocking fee). An even exchange is offered without a receipt, up to $70 worth of merchandise within a year.
Sears has a 90-day refund or exchange policy for most goods, 30 days on electronics, customized jewelry and other items including mattresses. Macy's has a number of limitations on items from furniture to jewelry.
Online retailers like Amazon.com and Overstock.com have strict limitations on what can be returned. For example, Amazon does not allow computers to be returned after 30 days and Overstock doesn't accept returned TVs over a certain size.
-----
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Thursday, December 17, 2009
Consumer Reports Poll: 40 Percent of Adults Have Yet to Begin Holiday Shopping
/PRNewswire/ -- Many Americans have put off shopping for holiday gifts. As of December 6th, 40 percent of adults said that they have yet to hit the stores for gifts, according to Consumer Reports' latest Holiday Shopping Poll.
They also told Consumer Reports that, on average, they will be spending $699 on holiday gifts. The full poll results are available on www.ConsumerReports.org.
Over the past three holiday shopping seasons, the average amount shoppers plan to spend on gifts has declined steadily. In 2008, shoppers anticipated spending $740, on average, down from $763 in 2007. While planned spending has decreased by $64, the number of gifts shoppers plan to buy has not changed. On average, shoppers plan to buy 15 gifts, which is about the same number as in previous years.
The next few weeks may be frantic for many shoppers, as only 12 percent have finished their holiday shopping and nearly one-third (30%) do not anticipate finishing until December 23 or later. Just over one-in-ten (13%) shoppers will not finish until December 24. And finding that perfect gift may be problematic for procrastinators, as a third (34%) of consumers who have started gift shopping have found an item they wanted was out-of-stock.
"The findings clearly show that Americans are taking a pragmatic approach to the holidays. And that's a good thing," said Tod Marks, senior editor and shopping expert for Consumer Reports. "Consumers are spending a bit less, focusing on more practical gifts, and vowing to take on less debt and pay it off sooner."
Consumer Reports' survey also found that 68 percent of credit card users plan to pay off their holiday debt by the end of January. These intentions seem ambitious, but in recent years adults have become more diligent in paying off their holiday debt.
Best Holiday Bargains
-- Survey respondents told Consumer Reports that they were finding the
best deals at mass merchandisers (41%) such as Walmart and Target, and
online retailers (39%).These were followed by department stores (21%),
discount stores (16%) such as TJ Maxx and Marshalls, outlet stores and
malls (12%), and warehouse clubs (11%).
Methods of Payment
-- About three-quarters (76%) of shoppers use cash to pay for their
holiday purchases, leading both debit cards (51%) and credit cards
(48%) by a wide margin. Men (41%) are more likely than women (29%) to
use cash most often.
-- Since 2007, the amount that consumers charge on credit cards to pay
for holiday purchases has steadily decreased. Shoppers who plan to
use their credit cards told Consumer Reports that they intend to put
less on them this year, charging $636 on average versus $682 in 2008
and $723 in 2007.
Credit Card Debt
-- Credit card users paid off their credit card debt faster last holiday
season than the preceding year. By the end of January 2009, 61
percent had paid off their credit card debt incurred during the 2008
holiday season, compared to 53 percent in 2007. However, just over
one-quarter (27%) did not pay off their 2008 holiday debt until March
2009 or later.
Give, Receive & Re-Gift
-- On average, consumers plan on buying about 15 gifts. Women plan on
buying more gifts than men, 16 compared to 13. And those getting
gifts this season may actually find them useful, as 34 percent of
adults told Consumer Reports that they are more likely to buy
practical gifts this year. This is good news for the 30 percent of
adults who said they wanted to receive more practical gifts. Although
practical gifts are not guaranteed to be good, especially if they come
from an extended family member, who 15 percent reported give the worst
gifts. Parents (6%) and in-laws (7%) are less likely to give the
worst gift. Seen that gift before? Look closely, as 15 percent of
gift shoppers reported that they will practice re-gifting this year.
Online Shopping
-- The percentage of shoppers who plan to buy gifts online continues to
increase. This year, 39 percent of shoppers plan to purchase gifts
online between early December and the holidays, up from 31 percent in
2006. And when it comes to online shopping, men (44%) are more likely
than women (34%) to do so.
Post-Holiday Shopping
-- According to the Consumer Reports' poll, nearly half (46%) of adults
plan to shop in-stores between Christmas and New Years, with most
being drawn into the stores to take advantage of post-holiday sales
(81%) and 69 percent planning to shop for themselves.
Wishing the Holidays Away
-- Bah humbug! As of December 6th, about one in five (21%) adults said
they wished the holidays were over.
-----
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They also told Consumer Reports that, on average, they will be spending $699 on holiday gifts. The full poll results are available on www.ConsumerReports.org.
Over the past three holiday shopping seasons, the average amount shoppers plan to spend on gifts has declined steadily. In 2008, shoppers anticipated spending $740, on average, down from $763 in 2007. While planned spending has decreased by $64, the number of gifts shoppers plan to buy has not changed. On average, shoppers plan to buy 15 gifts, which is about the same number as in previous years.
The next few weeks may be frantic for many shoppers, as only 12 percent have finished their holiday shopping and nearly one-third (30%) do not anticipate finishing until December 23 or later. Just over one-in-ten (13%) shoppers will not finish until December 24. And finding that perfect gift may be problematic for procrastinators, as a third (34%) of consumers who have started gift shopping have found an item they wanted was out-of-stock.
"The findings clearly show that Americans are taking a pragmatic approach to the holidays. And that's a good thing," said Tod Marks, senior editor and shopping expert for Consumer Reports. "Consumers are spending a bit less, focusing on more practical gifts, and vowing to take on less debt and pay it off sooner."
Consumer Reports' survey also found that 68 percent of credit card users plan to pay off their holiday debt by the end of January. These intentions seem ambitious, but in recent years adults have become more diligent in paying off their holiday debt.
Best Holiday Bargains
-- Survey respondents told Consumer Reports that they were finding the
best deals at mass merchandisers (41%) such as Walmart and Target, and
online retailers (39%).These were followed by department stores (21%),
discount stores (16%) such as TJ Maxx and Marshalls, outlet stores and
malls (12%), and warehouse clubs (11%).
Methods of Payment
-- About three-quarters (76%) of shoppers use cash to pay for their
holiday purchases, leading both debit cards (51%) and credit cards
(48%) by a wide margin. Men (41%) are more likely than women (29%) to
use cash most often.
-- Since 2007, the amount that consumers charge on credit cards to pay
for holiday purchases has steadily decreased. Shoppers who plan to
use their credit cards told Consumer Reports that they intend to put
less on them this year, charging $636 on average versus $682 in 2008
and $723 in 2007.
Credit Card Debt
-- Credit card users paid off their credit card debt faster last holiday
season than the preceding year. By the end of January 2009, 61
percent had paid off their credit card debt incurred during the 2008
holiday season, compared to 53 percent in 2007. However, just over
one-quarter (27%) did not pay off their 2008 holiday debt until March
2009 or later.
Give, Receive & Re-Gift
-- On average, consumers plan on buying about 15 gifts. Women plan on
buying more gifts than men, 16 compared to 13. And those getting
gifts this season may actually find them useful, as 34 percent of
adults told Consumer Reports that they are more likely to buy
practical gifts this year. This is good news for the 30 percent of
adults who said they wanted to receive more practical gifts. Although
practical gifts are not guaranteed to be good, especially if they come
from an extended family member, who 15 percent reported give the worst
gifts. Parents (6%) and in-laws (7%) are less likely to give the
worst gift. Seen that gift before? Look closely, as 15 percent of
gift shoppers reported that they will practice re-gifting this year.
Online Shopping
-- The percentage of shoppers who plan to buy gifts online continues to
increase. This year, 39 percent of shoppers plan to purchase gifts
online between early December and the holidays, up from 31 percent in
2006. And when it comes to online shopping, men (44%) are more likely
than women (34%) to do so.
Post-Holiday Shopping
-- According to the Consumer Reports' poll, nearly half (46%) of adults
plan to shop in-stores between Christmas and New Years, with most
being drawn into the stores to take advantage of post-holiday sales
(81%) and 69 percent planning to shop for themselves.
Wishing the Holidays Away
-- Bah humbug! As of December 6th, about one in five (21%) adults said
they wished the holidays were over.
-----
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