Everything you need to know about your right to return faulty Christmas gifts - Sarah Coles

But before you beat yourself up about this – or worse still go online and try to buy a voucher instead - it’s worth knowing that you’ve actually got them this season’s most effective present.

It means that when they survey their pile of unwanted items that aren’t quite right, and wonder how they can possibly convert them back into cash – you’ve saved them the effort.

This idea was seeded more than 20 years ago when former Wharton Professor, Joel Wadfogel, argued that giving anything else made no financial sense. He claimed that in the process of trying to work out what someone else wants, and getting it slightly wrong, for every £100 we spend, they’re only getting around £80 of satisfaction.

Years later, the University of Chicago encouraged other economists to weigh in on the subject, and they largely disagreed – arguing that giving specific presents also builds social bonds. And while it’s always difficult to argue with a large body of economists, I’m not so sure.

Those ill-fitting novelty socks and your least favourite flavour of chocolates are unlikely to make you feel any warmer and fuzzier about the people who gave them to you.

I realise this makes me sound incredibly ungrateful, so I should emphasise that my favourite presents of recent years have included an array of home-made gifts that demonstrated how well my lovely friends know me. What’s not to love about home-made sloe gin?

I’m talking more about the pressure to try to buy for people who you don’t really know very much about, but feel duty-bound to spend money on because you’re distantly related to them.

This information could come in handy for any last-minute shoppers, who can now stay at home and write a thoughtful note to put in with the cash instead.

However, if your distant relatives have already wrapped and posted your gifts in plenty of time, your challenge will be how to turn those unwanted gifts back into money.

If the gift is faulty, then your consumer rights are on your side, because you have the right to return it for a replacement, exchange or refund.

If the retailer is difficult about this, you can remind them that the Consumer Rights Act of 2015 means you have a legal right to do this, because the item they sold should have been of satisfactory quality, as described, fit for purpose and last a reasonable length of time.

If you got a gift receipt, then this should be plain sailing. However, if it arrived without the receipt, you may well have to ask whoever gave it to you for one, and ask them to write ‘bought as a present for Sarah” (or whoever it was for) on it, so the retailer will deal with you.

If this feels like a difficult conversation to have, you’ll need to decide whether you’d rather throw away a faulty gift or risk offending the person who bought it for you.

If there’s nothing actually wrong with it, if it was bought online less than 14 days ago, technically the person who bought it for you can return it with no questions asked, but this is going to be tricky for two reasons. First, given all the problems with deliveries lately, there’s every chance that anything that reached in time you was purchased weeks ago. Second, actually asking them to take their own present back could end up causing seriously family rows.

The good news is that plenty of retailers are more relaxed about returns over Christmas, and will let you bring back unwanted gifts, without a reason, out of the goodness of their hearts.

They may also extend their usual 30-day limit for returns, because they know there have been all sorts of delays this Christmas.

The downside is that without the receipt some may refuse to refund you – especially if it’s something you could have bought elsewhere. Even if they do refund you, you won’t necessarily get full price for the item.

If it’s in the sale by the time you return it, you’ll get the sale price instead.

If they refuse to take the item back, you’re faced with regifting or selling it. You’re going to get far more from a re-gift, because second-hand presents sold online will lose most of their value. If you put it up on social media, you also run the risk of alerting whoever bought it for you that it’s up for sale.

However, there are a few golden rules for regifting. You need to keep a note of who gave it to you, and not only avoid giving it back to them, but also make sure you don’t give it to anyone they know – especially if it’s easily identifiable.

You need to be careful about ‘use by’ dates if you’re going to keep it for next year, and you have to be honest with yourself: if you didn’t like it, will the recipient really want it?

If all else fails, a charity shop may be grateful for the donation, and if you gift aid it, then higher or additional rate taxpayers may be able to claim back the extra tax on their tax return – so you end up benefitting from it after all.

Why kids should play monopoly this Christmas

Never-ending games of monopoly are a key part of childhood Christmases, and while some people might worry that they’re teaching their kids one of the nastiest aspects of capitalism, when they demand rent from players with no cash, there are actually far more wholesome money lessons to be learned from the game

1. Always keep an emergency cash fund – here’s no point having a huge portfolio of assets if you land on Mayfair and need the cash.

2. Borrowing will cost you money – when you want to pay off the mortgage on a property, you have to pay more than you received when you mortgaged it in the first place. It could be a child’s first experience of debt.

3. Negotiation means a bit of give and take – trading properties is usually vital to success, but it only works when you’re willing to give something meaningful to your opponent. It’s a vital lesson in successful negotiation.

4. More risk may mean more potential reward – but you have to understand the potential for losses too. Some players snap up everything they can, and build houses at all costs – but eventually they learn that this could mean a win – or a major loss when they run short of cash.

5. There’s no such thing as a dead cert – once they have played a game where they bought hotels on Park Lane and Mayfair, and went bust because nobody landed on them, they know you can’t ever afford to bet the house on anything.

Sarah Coles is a Senior Personal Finance Analyst and Podcast Host for Switch Your Money On Hargreaves Lansdown