Dave Ramsey reveals the worst regifting mistake you must not make

During the holiday season, many people receiving gifts will outwardly be politely thankful, only to later consider the best ways to get rid of them.

Bestselling personal finance author and radio host Dave Ramsey weighs in about some essential things to remember when regifting.

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First, however, it's important to note that retailers generally understand that many purchases made during this period are gifts.

So one option is to return the gifts for refunds. Because retailers expect a rise in this activity, they expand their return policies during this time of year.

For example, most items bought from Amazon  (AMZN) - Get Free Report can be returned until Jan. 31. This process is most simple when an item was marked as a gift at the time purchase.

For items purchased between Oct. 1 and Dec. 31, Walmart  (WMT) - Get Free Report also allows customers to return them until the end of January.

Target  (TGT) - Get Free Report allows for returns within 90 days of purchase for most items. Electronics, however, have a shorter return window.

But some people entertain an entirely different choice regarding what to do with unwanted gifts. That's where Ramsey's warning about regifting comes into play.

There are some important regifting mistakes to avoid

The personal finance expert says there is nothing wrong with regifting, provided that it is done correctly.

"Let's face it," Ramsey wrote on Ramsey Solutions.  "Christmas can get expensive. On top of getting gifts for your family and friends, you might feel the pressure to get a gift for everyone in your life — your mailman, your daughter's lunch lady, your hair stylist and your four closest neighbors."

"So, what happens when your desire to be generous is bigger than your budget?" he asked. "Don’t worry — we've got a solution for that: regifting. You've probably been on the receiving end of a few gifts that didn't hit the mark."

Ramsey provides some advice on a few things to remember when regifting. But there is one he emphasizes more than the others.

"This one is important," he wrote. "When you get a gift, make a mental note of who gave it to you."

He then describes a scenario where forgetting this detail could go terribly wrong.

"Let's say your well-meaning Aunt Louise gave you a candle-making kit for Christmas," Ramsey wrote. "While you like candles, you hate anything DIY."

"Fast-forward a few years and you find a candle-making kit in your closet," he continued. "And wouldn't you know it, this would be the perfect gift for your Aunt Louise — she loves crafting. Yikes. If only we could see the surprise and disbelief on Aunt Louise's kind face."

"Don't say we didn't warn you," Ramsey added.

Other helpful tips on making the right moves

Ramsey advises people considering regifting to remember some additional important recommendations.

"Take the gift tags off," he wrote. "There's nothing worse than getting a gift with someone else's name on it."

Ramsey also says that rewrapping the gifts is mandatory.

"Go ahead and rewrap that sweater. Instead of letting the gift be a reminder of the person who gave it to you, you can give the gift new life," he wrote. "Be creative. Let rewrapping the gift be a reminder of the person you're giving it to — and that they'll be the perfect recipient of that sweater. Hopefully, they'll love it more than you ever could!"

The radio host mentions another important suggestion.

"There's a time limit," he wrote. "For example, there aren't a lot of people who want (or even have the ability to play) your unopened 'NOW That's What I Call Music' CD from 2010."

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