Should You Be Steering Clear of Gift Cards?

Have you gotten one of those emails warning against buying a gift card from a retailer trying to hang on?  The popular gift – for when you can’t think of what to give – is struggling these days.  There is worry that if you buy a gift card and the chain goes out of business the card is worthless.  The reality is a big, unsatisfying, maybe.  It appears gift cards certainly can be a dicey choice these days.  USA Today did some reporting on this…here’s a summary of some of what they found: 

Circuit City filed for bankruptcy but says it will honor gift cards…Linens ‘n Things went belly up in May but they too said your card is still good at their stores.  But…Bombay and Company…the furniture chain closed down and is paying off gift cards 25 cents on the dollar. 

Who’s on your side in all this?  The Consumers Union has asked the Federal Trade Commission to force retailers to set up a separate account to honor the gift cards it sells.  No word yet.