After visiting New York City from Pittsburgh with his wife last winter, producer Phil Jacoby returned home with a debt owed to him: unredeemed rides on their transit cards. Knowing he’d return to New York, Jacoby kept the cards to use on his next visit, which happened to be a year later. “I went to take it out of my wallet so I could use it again, but it was six days past its expiration date,” Jacoby explains. “There were probably two or three rides left on the MTA cards but I had to throw them away.”

Transit cards are just one example of the “ghost” products and services that haunt many of us: money spent but never really used, left to sit idly on transportation and gift cards. As they require an extra step to use, many people simply ignore them.

Multiple transit cards are often found in wallets. (Photo by Nastaran Tavakoli-Far/CNS)

The money adds up. The MTA estimates that approximately $18 million went unredeemed on MetroCards for the years 2009 and 2010. As for gift cards, of the $24.78 billion spent on them in the U.S. in 2010, it is estimated that $2.5 billion was lost or never redeemed, according to the financial research firm Tower Group.

New York resident Genevieve Hoffman also faces the trouble of purchasing new transit cards when her unlimited-ride ones expire, and is frustrated by the extra cards she has lying around. Furthermore, there is the problem of leftover change on cards, not enough for a ride but money spent and left unused. Most people are unaware that they can transfer value from one card to another, or they simply don’t do it.

“People are frustrated,” Hoffman says. “They can transfer their funds from one card to another, but when they are in a hurry they don’t.” She added, “We put all this money on subway cards and they do get us through turnstiles, but what happens to that extra money?”

A designer at New York University, Hoffman, with her team, has come up with way this unused money can benefit others:  “We thought it would be a wonderful opportunity to take the cards which end up in the trash can or your purse and turn them into a donation mechanism.”

Similar to the San Francisco Bay Area’s Tiny Tickets, whereby Bay Area Rapid Transit tickets can be donated into a box with the proceeds  going to local charities, Hoffman and her team hope to funnel unused funds to charities in New York.

Entrepreneur Ryan Witt also bemoans the lost money. The co-founder of Opani, a service that provides computing power for data analysis, Witt worked out the precise amounts that need to be added to cards to make up completed rides with no change left behind on them.  “I thought this is really silly,” Witt says. “There should be a app on your phone to calculate this, so I spent a few hours to make it.” MetroCard Business Calculator is available for free; after entering the amount of money left on your card, the app suggests amount needed to make up a specific number of rides.

New York commuter Ali Bachani has a wallet full of partially used transit cards.  While he generally purchases unlimited-ride cards, he does leave them behind occasionally, and has to buy a new card. “I usually pay $5 for a card and then take one ride on them, and there’s a ride left,” Bachani says. Furthermore, he has gift cards too, including one for the Chelsea Piers entertainment complex in New York, which he says he’ll probably use if he can go again before the card’s expiration date. He has another lying around for a store he can’t remember.

Entrepreneur Roger Wu despises gift cards. Or, as he puts it, “I hate hate hate hate hate them.” Wu believes that gifts should be personal. He says the whole beauty of gifts is that you have put in the effort to purchase something special for someone, which will remind that person of you whenever it’s used. Wu believes that gift cards break this bond.

“Gift cards are a huge amount of stress,” Wu says, “By buying one, I’m basically transferring the stress from me to you. Say you are given a $50 Walmart card and you spend $42, you then have $8 left to spend,” Wu says. “Then you go back into the store, see something that’s OK but that you probably wouldn’t buy, but it’s only $15. So then you put in $7 of your own money.”

Wu says people fall back on buying an impersonal gift card because there are too many gift choices. As a result Wu is launching Gift Finder, a service  to help people find the right gift for a friend or a loved one. Due to launch this summer, the system will use data about the gift receiver to come up with gift options. Wu hopes it will make the process of gift giving so much easier that people will give gifts to those they aren’t that close to and continue to create personal bonds.

“Gift cards ruin a relationship and the person ends up hating you,” Wu says. “It just transfers the stress.”

Email: nt2321@columbia.edu