How to choose a gas credit card
Quick insights
- Gas credit cards often offer rewards and benefits when you make fuel purchases.
- Many gas credit cards offer a discounted rate on purchases at gas stations as well as the ability to earn rewards.
- Consumers may want to review a gas credit card’s details before applying, including whether it has an annual fee or caps on rewards earned from fuel purchases.
The average price of a gallon of gas was less than 30 cents in 1950. Now, it’s not uncommon to spend more than $30 to fill up your gas tank. With gas being a typical line item on most household budgets, many people are looking for ways to save on gas. A gas credit card may be an option. In this article, we’ll dive into gas credit cards and some considerations when choosing one.
Understanding gas credit cards
A gas credit card is a type of credit card that offers rewards and benefits on fuel purchases. These cards can either be co-branded with specific gas stations, offering perks at those locations, or they can be general rewards cards that offer cash back or points for spending at eligible gas stations.
Gas credit cards may provide some of the following benefits:
- Rewards programs: Gas credit cards often offer cash back, points or discounts on fuel purchases, which may lead to savings over time, especially for frequent drivers. Cardmembers may also be able to redeem points earned on gas purchases for other goods or services.
- Convenience: For those who frequently travel or commute, having a gas credit card may add convenience by allowing easy payment at the pump and quicker transactions.
Gas credit cards are different than consumer credit cards, which can also offer rewards on gas station purchases.
Credits cards that offer rewards on gas purchases
Many consumer credit cards offer rewards on gas purchases. For example, the Chase Freedom Unlimited® credit card offers 1.5% cash back on most purchases, including those made at gas stations. Additionally, some credit cards will have rotating bonus categories that may offer additional rewards on gas station purchases for a specific time period.
Key considerations when choosing a gas credit card
If you’re looking to get a gas credit card, you may want to consider if it has the following benefits or terms:
- Annual fee: Does the card have an annual fee? If so, will it cut into the overall rewards? There are plenty of standard consumer credit cards that have no annual fee and offer rewards on gas.
- Rewards caps: Check to see if there is a cap on the number of rewards you can earn through gas purchases. Many cards may only offer rewards up to a certain dollar amount of purchases made within a certain time period.
- Redemption value: Once you’ve accumulated points, what can you spend them on? Knowing how you can redeem rewards may help you determine if the rewards align with your lifestyle or financial goals.
- Pump or gas station: Where can you earn rewards? Are your rewards applied only to gas purchases or will car washes and convenience store purchases count too?
- Membership requirements: Do you have to join a membership to use the card? And if so, do you have to pay for the membership?
As with any card, read the terms and conditions to see if the card and rewards make sense for how you typically make purchases and use credit cards.
Deciding if a gas credit card is right for you
One of the common perks of a gas credit card is getting a lower rate when you fuel up. Many cards will offer a certain number of cents off per gallon. That may help you save money on gas, but you may also want to consider getting a card that earns rewards on gas as well as other purchases.
Keep in mind that if you have a gas card that only earns rewards at a specific gas station, you may not be earning any rewards if you need to fill up at a station not associated with the card.
Maximizing savings with gas credit cards
If you do have a gas credit card, there are few ways you may be able to maximize the rewards you earn on gas purchases. They include:
- Use your gas credit card for all fuel purchases to earn the maximum rewards.
- Pay off your balance in full each month, if possible, to avoid interest charges that could offset your rewards.
- If your card offers bonus rewards in certain categories or during specific periods, make sure to take advantage of these.
In summary
Many gas credit cards offer a discounted rate on gas purchases as well as the ability to earn rewards. These cards can either be co-branded with specific gas stations, offering perks at those locations, or they can be general rewards cards that offer increased cash back or points for spending at eligible gas stations. You may find that some consumer credit cards can also offer bonus points and rewards on eligible gas purchases.
