The Pros and Cons of Gift Cards

Some of the downfalls include fees and no fraud protection.
1:51 | 12/25/14

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Transcript for The Pros and Cons of Gift Cards
More and more shoppers looking for last-minute presents are picking plastic. Gift cards were a number one search trend on our partner Yahoo! Today. But are they the right gift for everyone? ABC's Mara schiavocampo with what you need to know. Reporter: As we enter the final push before Christmas, gift cards end up being a popular last-minute gift. The national retail federation telling ABC news, an estimated $32 billion are being bought in gift cards right now. With the average person spending 174 bucks on these plastic gifts. But experts say they're not always the perfect pick, with consumer reports recently saying you're better off giving traditional cash or checks instead. Gift cards basically have all the disadvantages of money and none of the advantages. Reporter: Why? One -- fees. Gifts affiliated with credit card companies, not stores, usually have an upfront fee of $5 just for the purchase. Two -- unlike with credit cards, there's no fraud protection in the event a grinch steals your card. A gift card is like losing money if something goes wrong. It's just gone. Reporter: Though experts say the company might send you a replacement if you have the receipt. Three -- dormancy fees, chipping away at the card's total value the longer the card goes unused. Experts also suggest when buying a card, go to the back of the rack. Those up front on open displays are more likely to be tampered with. The biggest tip of all? If you get one of these cards, use it! Don't let money lie around. In recent years, an estimated $44 billion in gift cards never got spent. Turning a great gift into a lump of coal. Mara schiavocampo, ABC news, new York.

This transcript has been automatically generated and may not be 100% accurate.

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