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A display of gift cards in California

Canadians spend a lot on gift cards: about $6-billion a year, according to statistics. Their popularity stems from the convenience of not having to shop around for the right gift. Just pick a store, and leave the tedious decision of what to buy to the recipient.

Handy, yes. But like pre-cut fruit trays, that convenience comes with a price.

Many shoppers are under the impression that gift cards no longer have expiry dates or fees that eat away at their value over time. That's not always the case. While some provinces, including Alberta, B.C., Saskatchewan, Manitoba, Ontario, Nova Scotia and New Brunswick, have passed legislation to prohibit gift card expiry dates and limit fees, not all cards fall under these laws. Gift cards from federally-regulated financial institutions are exempt, including Visa and MasterCard prepaid cards. Also exempt are gift cards for a specific service, like a pedicure and prepaid phone cards. And those free gift cards stores give away around the holidays to lure in shoppers are also exempt.

I recently received three such cards from Mastermind Toys that expire in May. Good thing I checked!

Rules about fees are also all over the map. In Alberta, a one-time card activation fee is allowed. Alberta, B.C. and Ontario allow fees for customizing or replacing cards. And in B.C., Ontario and New Brunswick, shopping mall cards can include monthly fees on unused balances after a certain number of months have gone by.

"Gift cards will be as big a problem this year as they were last year," says Bruce Cran, president of the Consumers Association of Canada, who recommends people never buy gift cards. Mr. Cran says he's receiving lots of complaints from people about expiring cards, especially in Ontario.

In addition to expiry dates, it can be difficult to redeem the full value of some gift cards, Mr. Cran says. "If you've got a gift card for $50, they'll let you buy something for $40, but how do you get the other $10? They will never pay it to you in cash and it's very difficult to make a second purchase in some cases after you've made the first, and that $10 usually evaporates."

According to a U.S. consumer study, 25 per cent of gift cards are never redeemed, either because they expire, have been lost or are damaged.

"There's no doubt in my mind Canadians love their gift cards," says Mr. Cran, "but they're loved by the givers and they're hated by the receivers."

What?! People hate getting gift cards?

According to a recent Globe and Mail poll, only 17 per cent of us want a gift card this year. The most votes, at 35 per cent, went to a night spent with friends or family.

How's that for hassle-free giving? The only gift you'll have to wrap up is you.