Redeem Gift Cards While You Can

By Amy E. Feldman

PHILADELPHIA (CBS) - If you received a gift card for the holidays this year, you've probably tucked it into the back of your desk drawer and will find it again when you're searching for your car keys sometime next summer. But, while federal law now prevents most gift cards from expiring for five years, there's a reason to consider using them sooner rather than later.

According to Federal Court statistics, over 28,000 businesses sought bankruptcy protection in 2014, more than 19,000 of which will close their doors forever. So, you can kiss gift cards from those stores goodbye.

Others filed reorganization bankruptcy in which they keep their doors open and create a plan to repay their creditors. And while you might see them conducting business as usual, not everything is the same, as shoppers at The Sharper Image found when they tried to present gift cards as payment, only to find that the cards were no longer honored.

Under bankruptcy laws, gift cards are considered a loan to the company and not cash, so when a company files for protection from creditors, one of those creditors is YOU if you hold a gift card.

So while eyes are on Sears, Kmart, and RadioShack to see whether they will file bankruptcy, your best bet, use up the gift card while you still can - and while you can still find it.