As you know, I like to save money on purchases. For anything I intend to buy, I hunt around for the best deal. One of my favourite deals is buying discounted Gift Cards (GC’s) or topping up accounts on discount prior to a planned purchase.
A perfect example occurred last week.
With Major League Baseball finally starting (go Blue Jays!), I bought the MLB.TV app to watch, as I don’t have cable. I saved 16% by buying the app through iTunes.
How? I had previously loaded up on iTunes gift cards when they were on sale at Costco; $167.99 for a $200 gift card. 16% saved!
I know I’ve said it before, but…we would all be very excited to get a 16% return on our investments, so why not get as excited when saving 16% by purchasing a discounted gift card prior to an intended purchase?
That 16% savings doesn’t even take into account the 2% cash back I earn having bought those gift cards with my Amex. Speaking of which, I’m also a big fan of accumulating cash back with my credit cards and via other methods, which we’ll cover in a future post.
Costco has iTunes GC’s offer at least twice a year, and I always take advantage of it.
Besides the MLB.TV App, I also rent movies, and buying other apps through iTunes, including streaming services like Disney+, and Apple TV+.
By extension, I’m getting a 16% discount on every one of those iTunes purchases, as I regularly carry a balance on my iTunes account using those discounted gift cards.
And that’s just one example.
During a recent trip to my local Costco, I found other discounted gift cards, including:
- WaySpa 2x$50 GC’s for $74.99 (25% savings!)
- Just make sure your preferred mani/pedi provider is partnered with WaySpa, and is accepting their GC’s
- Several local and chain restaurants
- 2 x $50 GC for $79.99 (20% savings!) for Jack Astor’s, Sassafraz, Scaddabush, Hibachi Teppanyaki, and The Old Spaghetti Factory
- 2 x $25 GC’s for $39.99 (20% savings!) for Pizza Nova
- Lotto 649 & Lotto Max $100 value for $90 (10% savings!)
- Be careful, as this isn’t a regular gift card. For example, the pack includes 2x$20 Lotto 649 cards that are valid for 1 quick pick play with encore for 5 consecutive draws. I.e. you are only allowed to use it to buy very specific lotto plays.
If you frequent any of these restaurants, why not buy a few gift cards? I get it’s an extra step, but saving 20% on a few meals can add up pretty quickly!
So why do retailers, restaurants and other businesses sell gift cards on discount?
- Marketing – The in-store or on-line feature of the gift card offer is exposure for the business. When I saw the Sassafraz gift cards at Costco, it reminded me I haven’t been there in awhile and should go soon! Great restaurant in Yorkville (Toronto) BTW.
- Traffic – It drives people to the business. If you are given or buy a gift card for yourself, you typically go in (or on-line) and use it, often spending more than the gift card balance.
- Unused balances – Sometimes people don’t use their gift cards, and even lose them. Every business has a percentage of gift card purchases that they anticipate will never be used. For example, in 2019, Starbucks claimed revenue of $140M in gift card balances that were old enough to likely never be used.1
- Extra cash – At any given time, businesses may have large amounts of outstanding gift card balances. Given they already received the cash, that means they have money that they can invest or use in other ways. It’s kind of like borrowing money without paying interest!
All of those factors and more can make it attractive for businesses to discount their gift cards.
So, let’s not fool ourselves into thinking they are doing it for us. Still, I like to take advantage of the offers as it makes sense for me.
Where else can we get discounted gift cards?
There are websites like GiftCardsWild.com (Canada). Check out some of the discounts available in the picture below. Sure, some of the more aggressive discounts in the ‘Hot Deals’ section are businesses I’m not familiar with, but there are lots of great deals on places many of us shop!
Websites like GiftCardsWild.com and CardSwap.ca also allow you to sell unwanted gift cards. You don’t get full value, but if you received a card as a gift that you won’t use, it might be worth it.
Also try group purchasing websites like Groupon and WagJag for discounted gift cards. While they sometimes offer discounts on GC’s (or more like gift certificates or coupons), the offers tend to be on specific purchases, like this 3-course meal from Ruth’s Chris Steak house. Also read the fine print closely, as they often have expiration dates.
Topping Up Accounts
Similar to buying gift cards on discount, some of our accounts may allow us to top-up funds at a discount.
Again with iTunes, when my balance recently went to zero (thankfully right before Costco had their sale!), they had an offer to top-up funds with a bonus 10% (i.e. $200 gets me $220).
Amazon.ca has a one-time account top-up bonus of 5% when reloading your balance up to $100. i.e. $100 = $105.
Uber used to have a small top-up offer, but sadly it went away. Most people probably just have each Uber trip or Uber Eats charge go onto their credit card. If you had pre-added money to your Uber account, you were able to add $100 for $95. It was only 5%, but if you used Uber enough, it was worth it. I was sad to see them discontinue this offer.
Prepaid phone plans often have discounted account top-ups. 7-Eleven Canada currently has a $25 account bonus when buying a $100 top-up for SpeakOut Wireless. I.e. $100 = $125.
As I was editing this post, WagJag sent out an offer for a $100 WagJag credit for $85. If you buy from WagJag regularly, it might be worth buying this for a quick 15% off!
Keep an eye out for deals as many of them are short-term offers. Last summer, 7-Eleven had a great deal for $100 Amazon gift cards with a free bonus $25 Cineplex gift card. That deal didn’t last long, as it was apparently much more popular than they anticipated.
A couple of things to consider when buying discounted gift cards or topping up accounts:
- Make sure you will use the funds – Only pre-pay if you know for sure you will use it. Don’t buy the card if you only might use it.
- Use quickly – Make sure you will use them over a reasonable period of time. If you save 10%, but it takes you 5 years to use it, it’s probably not worth it.
- Burning a hole in your pocket – If having the gift card or balance on your account leads you to buy more, then don’t do it! If you are prone to spending money because you have it, don’t tempt yourself.
- Don’t put on credit – Only put on credit if you pay it off before incurring interest. If you are carrying a credit card or line of credit balance, don’t buy discounted gift cards, pay down your credit first!
- Restrictions – Make sure there aren’t any restrictions on what you can buy, like the Lotto 649/Lotto Max example above. Unless that’s exactly what you wanted to buy, of course.
- Costs & Expiration– Understand if there are any hidden costs or expiration to the card. Fortunately, in DMWOM’s home Province of Ontario, the Government enacted a law that restricts most gift cards from having expiration dates, or fees that reduce the balance over time2. That said, there could still be costs or other things to consider, so make sure to check first.
- Remember – Don’t forget you have them! I’ve kicked myself when buying something in a store, knowing I had a gift card I’d forgotten at home. I’ve even made purchases forgetting I had the GC in my pocket lol!
- Bankruptcy – Be careful it’s not for a business that may go under, especially these days with all of the Covid-related bankruptcies. This of course ties into ‘Use Quickly’ above. I’m a bit concerned about my Cineplex movie theatre gift cards; fingers crossed they bounce back!
So long as we adhere to the suggestions above, we can save a ton of money buying discounted gift cards and account balance top-ups. Another great way to ensure we are all Doing More with Our Money.
If you haven’t been doing this before, don’t go nuts on it. Just try one or two that you know you will use, then go from there.
Let me know if you’ve come across any great gift card or account balance top-up discounts!
Thanks for reading.