Got a gift card for Christmas? Use it ASAP

Check out the story I did for CreditCards.com about what to do if you give or receive a gift card from a bankrupt retailer.

This idea was spurred by a Linens n' Things gift card I received from my brother-in-law. I had left it lying around for months and finally used it only after hearing that the retailer was closing its stores. I couldn't use it online so I had to go out and find a store. The nearest one was a mess as bargain-hunters and frantic gift-card recipients like me stormed the shelves. I bought the retail value but couldn't shake the feeling that I wasn't getting my money's worth because I had shopped "stale" merchandise that had been picked though multiple times.

The gifting of retailer gift cards is on the decline, but $60 billion worth of them will still be bought this year. All the experts I spoke to said that if you do receive a gift card for the holidays, use it ASAP.

KB Toys will probably not be the last drop in the bankruptcy bucket -- January and February are the two months when most retail bankruptcies are declared.

If you do plan to buy a gift card, do so with your credit card because you may get reimbursed by your card issuer if the purchase goes bad. If you can't use your gift card, don't expect much help from the bankruptcy court or your state's attorney general -- your $50 card pales in comparison to a creditor like IBM owed $50 million for its tech supplies.

Still, as retailers keep falling right and left, Congress may have to change the bankruptcy laws for gift cards so paying customers aren't the ones left holding an empty bag.