Believe it or not, there's a worse gift than a mashed-potato-scented candle. One unfortunate Consumer Reports survey respondent received such a present last holiday season. But consider this: Giving a gift card can be a bigger waste of money. That's one of the findings in our recent Holiday Shopping poll. The Consumer Reports National Research Center surveyed 1,000 adults about holiday shopping habits. Here are our major findings:

• Unused gift cards are the new billion-dollar business. According to our survey, the second-most-popular gift for 2006, favored by 60 percent of shoppers, is gift cards. (Clothing came in first at 73 percent.) While gift cards seem like a fail-proof present, they may be as useful as an animatronic singing trophy fish. About 23.3 million Americans have unused gift cards from last year's holidays--that's at least $972 million in unredeemed cards. Indeed, 54 percent of respondents received gift cards for the 2005 holidays. Nearly a year later, 19 percent of the gift-card recipients have not used one or more of the cards received.
  
  
• Discount and online shopping gain popularity; department stores lose. This year, discount mass merchandisers such as Wal-Mart and Target, along with online stores, are the only retailers likely to gain more gift-buying customers. Meanwhile, department stores and outlet malls will see the biggest declines. According to our survey, 71 percent of respondents will shop at discount stores such as Wal-Mart and Target and 62 percent said they would shop at department stores such as Macy's.
  
  
• Online security is (sort of) a concern. More people than ever are shopping online. But when it comes to sending personal and financial information across the Internet, most are still concerned. Among those respondents planning on buying online for the holidays (39 percent), the majority (72 percent) are very or somewhat concerned about the security of their financial or personal information. Most of those expressing concern have taken precautions to protect themselves (86 percent), such as securing passwords, using sites with secure connections, and shopping only at well-known sites.
  
  
• Extended warranties are often part of the purchase. Consumer Reports cautions against buying this costly coverage. Previous data from thousands of our readers have shown that, generally, extended warranties cost not much more than the average repair. But pushy sales clerks often make persuasive arguments. Indeed, when buying home electronics or major appliances, 42 percent of respondents said they would opt to buy extended warranty coverage. Further, it seems younger, perhaps less-experienced shoppers are more vulnerable to the passionate sales pitch extolling the benefits of buying an extended warranty. As our survey showed, those 18 to 34 years old are more likely to opt for extended coverage (55 percent) than are older consumers.

What (not) to put on your list

• After clothing and gift cards, the top gifts for 2006 are toys (54 percent) and electronics (53 percent). Within the electronics category, video-game systems (21 percent), home video-entertainment systems (20 percent), MP3 players or iPods (19 percent), and digital cameras (18 percent) are the leading choices.
  
  
• Make your list, but check it twice. The most desired gift among men is electronics (21 percent); among women, gift cards (16 percent) are top (even if they don't use them), followed by jewelry (12 percent).
  
  
• Buyer beware. Despite being the most popular gift for shoppers, in 2005 clothing was the most disappointing category of gifts received (36 percent)--the biggest offender was socks (11 percent).

GIFTS FROM THE HEART

We also found that random samplings of most liked and most disappointing gifts for the 2005 holiday weren't always easy to quantify for a shopping list. Of course there was the loathsome mashed-potato-scented candle, and the hated socks. But some respondents were also disappointed that they didn't see or get to spend time with their family. And at least a handful included good health and peace on earth among their most-wanted gifts.

Methodology: The Consumer Reports National Research Center conducted a telephone survey of a nationally representative probability sample of telephone households. One thousand interviews were completed among adults 18 and older. Interviewing took place Oct. 12 to Oct. 15, 2006. The margin of error is +/- 3 percentage points at a 95 percent confidence level.