With prices at the pump hovering around four bucks a gallon, all of us are looking for ways to save money on gas. One such strategy is to use credit cards that give a discount or rebate on fuel. But before you jump on the bandwagon, make sure you understand the pros and cons of each card. A number of them have confusing reward caps, spending tiers, and other drawbacks that aren’t always obvious at first glance.
Of course, there are dozens of gas cards out there, but according to the chatter on Credit Card Forum, below are ten of the most widely discussed (for better or for worse):
#1 – PenFed Visa Platinum Cashback Rewards
Pros: This card gives you a no strings attached 5 percent cash back at gas stations when paying at the pump (that means transactions inside probably won’t count). There is no annual fee, no cap on the rewards, and you get the 5 percent at every station with the exception of warehouse stores like Costco or Sam’s Club.
Cons: You have to be a member of Pentagon Federal credit union. However, even if you’re not affiliated with a qualified branch of the military or government, you can still join this credit union by making a one-time $20 donation to the National Military Family Association or a $15 donation to Voices For America’s Troops.
#2 – American Express Blue Cash
Pros: The ability to earn up to 5 percent at gas stations, as well as grocery/drug stores, plus 1.25 percent elsewhere. There’s no annual fee.
Cons: This card comes with one major drawback and that is its spending tiers. You only get the 5 percent on those categories after spending $6,500 per year. Everything below that amount only earns 1 percent on the three categories and 0.5 percent on other purchases. This means you have to be a big spender for the rewards program to make sense.
#3 – Chase BP Visa
Pros: You get a high rebate at BP gas stations of 5 percent. In addition, the card gives 2 percent for eligible dining and travel spending, plus 1 percent elsewhere. There’s no annual fee and after thoroughly reading through all the fine print, I can’t find any mention of reward caps or limits being imposed.
Cons: The gas rebate is excellent but it only applies to purchases at BP. Depending on your area, their gas may be more expensive than other stations.
#4 – Chase Freedom
Pros: No annual fee and for 3 months out of the year, it gives a 5 percent rebate at gas stations. All other spending nets a 1 percent rebate.
Cons: The reward categories change every three months and so far, Chase has never featured the gas category more than once per year. That means you only have the ability to save 5 percent at gas stations for one-quarter of the year. Furthermore, last year they added a cap on the amount of spending that is eligible for the higher rewards – $1,500 per quarter. In order to participate in the 5 percent you need to signup each quarter via their website or phone.
#5 – Discover More
Pros: This card is similar to the Chase Freedom, in that its 5 percent categories rotate and at least once per year gas is among them. If you redeem your cash back for gift cards from retailers, it’s possible to bolster the value (i.e. $50 Starbucks gift card costs $45 in reward dollars). There is no annual fee.
Cons: Like the Freedom card, you’re only getting 5 percent on gas for a fraction of the year and you have to signup in order to earn it. Discover also caps the 5 percent (the amount varies). All other spending doesn’t automatically earn the usual 1 percent. You first have to spend $3,000 per year (5% percent category spending doesn’t count) before you start earning 1 percent and prior to that it’s 0.25 percent.
#6 – Capital One “No Hassle” Cash Rewards
Pros: This card gives 2 percent cash back at gas stations & grocery stores and 1 percent on all other spending. There are no caps or spending tiers involved.
Cons: There are two versions of this card – both with identical rewards – but one of them charges a $39 annual fee. In order to qualify for the free version, you need to have “excellent” credit. Lastly, Capital One is notorious for poor customer service but they have been trying to improve that lately.
#7 – Phillips 66/Conoco/76 MasterCard
Pros: You get a 4 percent rebate at Philips 66, Conoco, and 76 gas stations (they’re all subsidiaries of the same company). There’s no annual fee.
Cons: You’re limited to these three brands of gas. On purchases outside these stations there is a tiered structure; annual spending below $5,000 only earns 0.5 percent and above earns 1 percent. Each billing cycle the max amount of rewards that can be earned is $50.
#8 – Chevron/Texaco Visa
Pros: This no annual fee card gives a 10 cent/gallon rebate at Chevron and Texaco (and 3 percent on non-fuel purchases made there) plus 1% everywhere else. Up to $300 in fuel credits can be earned per year, which is a relatively high cap that should be plenty for personal use.
Cons: Whether or not this card is the best largely depends on the price of gas, since the fuel rebate is a fixed amount. At $2.00 you are earning 5 percent, but at $4.00, it’s only a 2.5 percent rebate. There have been a large number of complaints on CreditCardForum by purported cardholders regarding the customer service, probably more negative reviews than any other gas card. Rewards are only earned at their stations.
#9 – ExxonMobil MasterCard
Pros: 15 cent per gallon discount at Exxon and Mobil stations. The card is free and after examining the application I can’t find anything about there being any caps on gas rewards.
Cons: If gas keeps going up and hits $4.50 or $5.00 then the 15 cent per gallon discount would only equal 3.33 percent and 3.00 percent, respectively. The tiered rewards on purchases made elsewhere are extremely confusing: 0.5 percent on annual spending up to $999; 1.0 percent over $999 and up to $5,999; 2.0 percent over $5,999 and up to $10,000; and 1 percent over $10,000. Last but not least, the price at Exxon and Mobil stations may be above average in some areas.
$10 – Discover Open Road
Pros: This is Discover’s gas card, which carries no annual fee and gives 2 percent at gas stations and restaurants.
Cons: Previously the Open Road gave 5 percent on gas but for the past couple years it’s been 2 percent. Only $250 of monthly spending in those categories will qualify for the 2 percent. Beyond that and on all other purchases, the rebate is 0.25 percent for annual spending up to $3,000 and 1.00 percent after that.
This guest post was provided by Credit Card Forum, a website for reviews of credit cards, including a list of the best gas cards, which is regularly updated.
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