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Kip Tips

Best Gift Cards to Give for the Holidays

These four types of cards have broad appeal because they offer recipients the most flexibility.

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Gift cards often are considered fall-back gifts – what you buy when you don’t know what else to get someone or don’t have time to come up with something more creative. You don’t need to feel guilty about giving people gift cards this holiday season, though, because they probably want them.

SEE ALSO: Gifts That Keep on Giving

Gift cards are the most requested gift item for the eighth year in a row, according to the National Retail Federation’s holiday consumer spending survey. And more than half of the respondents in a survey by CashStar, which runs digital gift card services for retailers, said they would rather receive a gift card than a physical gift.

Before you go load up on gift cards for all of your friends and family, however, you need to decide which cards to buy. Don’t assume someone will appreciate a gift card to a store or restaurant just because it’s your favorite. Instead, choose one of these four types of gift cards with broad appeal that are sure to please everyone on your shopping list.

General-purpose gift card. If you want to give someone a gift card that lets them decide where to use it, consider one from Visa, MasterCard, Discover or American Express. These issuers’ cards typically can be used anywhere their credit cards are accepted, says Jill Gonzalez, a spokesperson for credit-card comparison site CardHub, which compiled a list of the most popular gift cards. However, you need to read the fine print because there are exceptions, she says. Plus, you'll pay a price for the flexibility. Visa and the other card issuers tack on a purchase fee, so you'll pay more than the face value of the gift card. You can buy these general-purpose gift cards at banks and Web sites sites such as CardHub and GiftCards.com.

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General-merchandise retailer gift card. If you don’t like the idea of paying an additional fee when purchasing a gift card, a card from a retailer that sells everything from apparel and electronics to food and toys is your next best bet. In fact, gift cards from Amazon, Target and Walmart are among the 10 most-popular cards this year, according to CardHub. And their gift cards do not expire. All three are offering free shipping now on gift cards purchased on their sites.

Downtown business district gift card. If you know the person you’re buying for likes to support local businesses, Shelley Hunter of GiftCards.com recommends checking with your Chamber of Commerce to see if it offers gift cards redeemable at stores in your downtown association. For example, the Fredericksburg (Va.) Main Street Initiative offers an Experience Fredericksburg Downtown Gift Card that can be used at nearly 100 participating businesses. These sort of gift cards offer flexibility for the recipient and bring dollars into the community, Hunter says.

Choice gift card. Several supermarkets, including Safeway and Kroger, sell “choice” gift cards that give the recipient the ability to choose any of the retailer or restaurant gift cards sold at that supermarket, Hunter says. Again, these cards offer flexibility, but they require the recipient to return to the supermarket to pick out the card they want (in the amount of the choice card the giver purchased).