A gift that keeps taking: Add up the costs on the Vanilla Gift Card

On the face of it, gift cards seem like a smart and simple way to handle presents. You don't have to shop for something, they're easy to get and they seem more thoughtful than handing someone cash.

Then I met the Vanilla Gift Card. The buyer has to pay $28.95 to give someone $25 (a bigger fee for bigger values). That's on the giver. After that, it's the recipient that pays. If the card isn't used up within a few months, fees kick in that could suck it dry. One card recipient recounted trying to use a $50 card for $50 in merchandise only to find the card had $12.50 in fees drawn from it.

After seven months, the card faces $2.50 a month charges. In many states, such fees are not allowed to be applied to gift cards. That is...gift cards tied to a particular place of business. In this case, because you can use the card anywhere a Visa is accepted it's fair game. And, if you care to read the fine print on both the card and the card's web site, it's there for all to see. Seedy, but in plain view.