Hey DarrelEW a lot of great points there.
In regards to pre-paid Visa/MC/Amex cards, they will sometimes cause problems at pay-at-the-pump gas stations, since the pump has no way of knowing your remaining balance. Likewise, stores can't find out your remaining balance, so you'll need to keep track and process separate payments up to the full balance of the card.
There have been a couple times I have been given a Visa gift card for a purchase or rebate. Like buying 4 tires and getting a $50 Visa card. That problem is so true about the low balances and I can't help but assume Visa and MasterCard set them up that way on purpose so they can keep a little bit from each account. I was down to something like 27 cents on a card and was having a rough time finding a store that would just let me charge 27 cents and then the rest on a different card. It can be a real pain in the butt to deal with those.
But with stores on the other hand it shouldn't be a problem. Like when I was at Chipotle yesterday using up the remaining balance on my gift card from Discover, the amount was credited to my order and then the cashier told me I still owed $1 and change. That is how most stores work with most gift cards from my experience. It's those pesky Visa, MasterCard and AmEx gift cards that will be the biggest headache.
The best way to reduce risk would be to only collect cards for places that you go frequently, or for shopping trips you plan on taking in the next week or so. Possibly just start out simple with gas gift cards, since 6% on gas/groceries will add up to quite a bit each year. Then start getting cards for Amazon, department stores, restaurants or anywhere else that you visit frequently.
Couldn't agree with you more. Keep the essential gift cards on hand. For me that would be gas, Subway and that's about it. For department stores, Best Buy and places like that, it would probably be best to swing by the grocery store on the day you go to pickup your gift cards rather than buying in advance.
Disclosure: I am a moderator/paid staff of this site, which does have advertising relationships with some credit cards that are discussed and linked to. Regardless, anything I say is my honest opinion.
Current Cards: American Express:
Blue Cash, Simply Cash Bank of America:
WorldPoints Platinum Plus Chase:
Amazon, British Airways, Cash Plus Rewards, Freedom, Ink Cash Citi:
Thank You Premier, Dividend Platinum Select Discover:
MorePrimary Everyday Card: American Express Blue CashPrimary Travel Card: Chase Sapphire Preferred