With several banks and major retailers going out of business this year, consumers with unused gift cards from these companies are often out of luck.

To make sure your gift dollars go to the recipient and not the retailer or bank, this may be the year you send a check or money order instead of a gift card.

While gift certificates have been around for years, more and more retailers have switched to stored value gift cards. Gift cards look like a credit card with a magnetic strip that stores information about how much the card is worth. Some cards can only be used at one retailer, some can only be used at stores in one particular mall or shopping center, and others can be used anywhere major credit cards are accepted.

Retailers like stored value gift cards because they are easier and less expensive to handle and more difficult to counterfeit. Another plus for retailers is that stored value cards put an end to the practice of purchasing a small item, paying with a gift certificate and receiving the bulk of the face value in cash to spend elsewhere.

Consumers seem to like them, too.

Gift card sales are expected to exceed $94 billion this holiday season. Whether giving or receiving gift cards, be sure you understand how they work.

You also want to make sure you understand what happens if the issuer goes out of business before the card has been used.

Consumer advocates recommend cards from specific retailers over cards offered by banks. Bank cards can be redeemed wherever credit cards are accepted, but tend to come with more and higher fees. However, when the bank or retailer that issued the card goes out of business, you could be left with a worthless gift card.

Consider the cost.

Gift cards from major retailers are usually free of extra fees. Gift cards that can be used at multiple retailers sometimes come with a small fee.

Watch for hidden fees.

You may be charged to check your balance, so be sure to keep track of how much you spend. Watch for delayed fees. Some issuers begin charging fees ($1 to $2.50) after a specified time period if the card has not been used or used up. These fees may kick in as early as six months from the date of purchase and can quickly eat up the value, particularly for low value ($5-$25) cards.

Do not lose the card!

If a gift card is lost or stolen you may not be able to replace it. Some retailers, charge an replacement fee, provided you have proof of purchase (such as a sales receipt) and the card’s ID number. Registering your gift card with the issuer often provides extra protection.

Use the card promptly.

About 10 percent of gift cards are never redeemed. That is a gift to retailers of more than $9 billion that you probably did not want to give. With so many retailer’s going out of business this year, it’s more important than ever to use your gift card promptly.

When giving gift cards, be sure to include details about fees so the user will know how best to use the card. It is also a good idea to include the receipt in case the card is lost or stolen.

If you receive a gift card, register it with the issuing bank or retailer. Information about how to register your card should be included with other details. If not, check the Web site of the issuer for information about how to register your gift card. Some issuers will not replace lost or stolen gift cards; unless they are registered.

Gift cards are convenient and extremely popular. This year you might be better off just sending a check.