Everyone is looking for ways to lower their gasoline bills. One way to do that is with a gas reward credit card. There are lots to choose from. Some offer points, others give you cash. Some can be used anywhere, others are limited to one brand of gasoline.
“This is the perfect time to take a look at these gas cards,” says Beverly Harzog, credit card adviser for credit.com. “And many cash-back cards are offering sign-up bonuses right now.”
Find the right card and you can easily cut your fuel bill by 3 to 5 percent. I contacted four websites that specialize in credit card comparisons – CardHub.com, LowCards.com, Credit.com and NerdWallet.com – and asked for their top picks for gas cards. Three cards got the most recommendations.
- Chase Freedom Visa: It pays 5 percent cash back on up to $1,500 of gasoline purchases in the first and third quarters. The rest of the year the gas reward drops to 1 percent. This card offers a $200 cash bonus if you spend $500 in the first three months. No annual fee.
- American Express Blue Cash Everyday Card: You get 2 percent back on gasoline, 3 percent on grocery and department store purchases and 1 percent on everything else. Spend $1,000 in the first three months of receiving the card and you get a $100 cash back bonus. No annual fee.
- Pentagon Federal Credit Union Platinum Rewards Credit Card: With this PenFed Visa card you earn points that you convert to cash (in the form of a Visa prepaid card), merchandise or travel. The points work out to 5 percent for gas, 3 percent for groceries and 1 percent for everything else. And there’s a bonus: You get 5,000 points after your first purchase and 20,000 points if you spend $1,000 in the first three months of having the card. There is no annual fee. You don't need to be in the military or work for the government. Anyone who joins the National Military Family Association ($15 one-time fee) or Voices for America's Troops ($20 one-time fee) can get the card.
Most major oil companies have their own credit cards. They usually offer great rewards (the Marathon gas card pays back 6.9 percent) but they can only be used at affiliated service stations.
“If you are brand loyal, you should consider what that chain has to offer and compare it to the bank-issued cards,” says Odysseus Papadimitriou, CEO of Card Hub.
A few cautions
Before you apply for any credit card, take the time to read all the terms and conditions. Be sure you know how the cash-back offer works and look for any restrictions.
“There are pitfalls everywhere,” warns Anisha Sekar, vice president of credit and debit products at NerdWallet. “So you need to be on guard for a caveat in the rewards program that significantly lowers the value of the card.”
These pitfalls include:
- Spending categories that rotate each quarter. That 5 percent reward on gasoline purchases could be limited to certain times of the year. And you may have to go online to sign up for that higher reward every quarter.
- Spending tiers that must be reached in order to qualify for the maximum cash-back reward.
- Limits on how much you can earn in a quarter or a year.
Gasoline reward cards are not all the same. Take the time to find the one that’s best for you based on your spending habits.
For example, the Costco American Express card pays 3 percent back on gas purchases but caps that reward at $3,000 worth of purchases a year. The American Express Blue Cash Everyday card gives 2 percent cash back on gas with no limits.
Remember: Reward cards have high interest rates. So they only make sense if you pay your balance in full and on time every month.
“The rewards you get, as attractive as they may sound, are going to be more than eaten up by the high interest rate that you will be charged if you carry a balance,” warns Bill Hardekopf of LowCards.com.
You can compare these cards at sites such as: CardHub.com, LowCards.com, Credit.com, NerdWallet.com and Bankrate.com.
