Buy Used Gift Cards and Earn a Major Discount on Anything You Want

by Kevin on June 3, 2011

Many frugality articles out there talk about pinching a penny here and saving a percentage point or two over there. While I completely agree that, over time, these tactics will save you money, I do not think they are the best course of action today. If you are looking to save money on anything — a product you want to buy or a service you currently receive — you need a major discount.

Compare Two Discounts

Which would you rather have:

  • a $2,000 discount on the price of a car you purchase, or
  • saving 2.5% on your car insurance for something absurd like the next 30 years with the caveat that every 12 months you have to call and negotiate for the discount

Anyone who takes the second option is a fool.

It isn’t that negotiating to save on your car insurance every year or so is a bad thing. It isn’t. I’ve done it and highly recommend it because it will save you money.

But if you only have one option? Take the big discount in one fell swoop. You don’t have to re-engage to keep saving money. You don’t have to worry about anything. You negotiate hard on the big item, you take the big win, and you stop worrying about saving 2.5% because you just saved two thousand dollars.

The only problem becomes what if you don’t have any more big wins left to go after? You’re not planning to buy a car, a couch, or a television any time soon. Then sure, move on to significant wins without having to spend the rest of your life clipping coupons.

Easy, Significant Wins

Today I’m going to share a very simple, but easy way to score a series of smaller wins that can add up into a big win. Personal finance guru Ramit Sethi is a huge proponent of cutting mercilessly on things that you don’t care about. On the flip side of the coin he advocates spending money on things you really enjoy.

Yes, a personal finance expert is saying to spend money. Unfathomable.

If you are going to be spending money on the things you enjoy, would you be interested in learning how spend that money while being able to stretch those dollars? The only thing better than spending money on something you enjoy is being able to get more of whatever it is you love with the same amount of money.

That’s what we’re looking at today.

Buying “Used” Gift Cards

Let me use myself as an example. My wife and I just bought a house. (Unfortunately, there are no gift cards for houses.) We are looking to spend some money decorating the home well because this is the place where we plan to live for 20 or 30 years. We are willing to spend a little bit of money today for long term value.¬†At the same time, if we could decorate inexpensively but in a way that was pleasing to us, that’s even better.

We came across a rug at Pier 1 Imports that we liked. It was the right color, pattern, and so on. It was also attractive to us because it was on clearance for 50% off. We’re talking a $300 rug available for $150. We know they are still making money at that price point, but rugs are surprisingly expensive. (We know because we did research – key to identifying true values.)

Instead of rushing out to the nearest store and snagging one of the rugs, we thought we could get a better deal. Since it is on clearance, we ¬†probably can’t negotiate down with the clerk in the store. That’s a given. So we go to the next best option: buying a Pier 1 gift card from someone else at a discount.

There are several popular websites that will buy your gift card from you and resell it to another customer. You can sell your unwanted funds, get the cash, and go on your way. Sites like PlasticJungle, CardWoo, and GiftCardRescue are all popular. So we visited those sites and did a search for Pier 1 cards at around $150.

We were able to identify a card valued at $150 but sold to us at a 15% discount ($127.50). For a few clicks of a button we just saved $22.50. So simple.

“Ah, but the rug is on clearance! What happens if you go to the store and there are no more rugs?”, thinks the reader.

Great point. Before we ordered the gift card (I don’t want to be stuck with a $150 gift card to a store we rarely shop at) we went to the store tonight and asked if they could hold it for a few days. They said they could only hold it for 24 hours.

Instead of giving up, I asked the clerk what their return policy was. She explained it to me, and I asked if we would be able to buy the rug tonight on our credit card, and when we had the gift card, bring the receipt back to “return” the rug, then re-buy it with the gift card. She checked with her manager and it was no problem.

This is a win in multiple ways: we gained an extra 7.5% of discount (for a total discount of 57.5%) worth an extra $22.50 (total savings of $172.50 off of retail) for a few clicks of a button, we aren’t stuck with a gift card to a store we don’t regularly shop at, and we got what we wanted.

That’s a significant win. It isn’t a big win because we’re not going to get rich off of a $22 discount (or really, a $172 discount). But it is significant because we saved a nice chunk of change on something we were going to buy regardless of the discount, and we didn’t have to exert a lot of effort to get it.

The next time you go to buy something, anything, check out the used gift card websites. Has anyone else done this?

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