Beware of shopping blunders

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NEW YORK (CNNMoney.com) -- Sagging sales, liquidation, bankruptcy - this holiday season, the retail biz is hard to navigate. Here are some mistakes you'll want to avoid as you do your shopping.

Bottom line here: Avoid buying cards from financially distressed retailers.

Consumers have lost millions in gift-card value to bankruptcies. Now, if a retailer goes bankrupt, your gift card may be honored - or a competitor may honor it. But it also could be that it's not honored and you could be stuck in bankruptcy court along with other creditors.

No and more importantly, it's still not the best deal out there. In November, the FDIC expanded its insurance to include bank-branded prepaid gift cards, but only if your name and information is registered and attached to your card purchase - which isn't often.

So, if your bank goes under, you're unlikely to have any insurance says David Barr of the FDIC. Plus, bank cards are usually saddled with fees and expiration dates.

Consumer groups like Consumers Union have asked the FDIC to ensure that gift-card proceeds held in banks - whether for the bank itself or a retailer - are insured for every cardholder. So we'll keep you updated on those developments.

Here's a bit of a silver lining: This year a little more than half of retailers polled by the National Retail Foundation indicated that holiday return policies will be more lenient this year than the policy for the rest of the year.

Some stores have streamlined and increased the time you have to return items by as much as three weeks in some cases. Other stores, like Sears, are easing restocking fees says Ed Dworsky of Consumerworld.org. Of course, that's not all across the board.

Best Buy (BBY, Fortune 500), for example, shortened the time you have to return your stuff by a week. That said, you should still make sure you understand exactly what that the return policy is.

If a store is liquidating, it could mean the store is going out of business. If a store is liquidation, you better be satisfied with the product you're buying.