How Do You Save Money on Gas With Credit Cards?
Assuming that you pay your credit cards in full and do not incur any fees, there are credit cards that pay you up to 5% cash back for gas purchases. The best type of cash back has no end to such promotion. PenFed (Pentagon Federal Credit Union) credit card is one of them, where it is always 5% cash back on gas purchases. Nominally, this card is for Pentagon employees but I happen to qualify under my agency; however, by joining one of the qualifying associations for one year, you can obtain the card and then not renew your membership to the association.
Discover Card just ended its 5% gas promotional in March 2012. Although Discover card does not have any limits on regular 1% cash back, it does have limits on the 5%. So, it is important to read the small prints. On the other hand, you do not need to spend $3000 to start earning the 5% whereas the 1% you do. And, you have to sign up online to receive it. Otherwise, you would just be receiving 1% back after your first $3000 purchase. The first $3000 earns a smaller percentage. So, if it takes $50 to fill up your tank, then you are getting $2.5 back in cash on your credit card statement. With Discover, your bonus dollars can be used to buy discount gift cards. It was once a better program with better deals such it still as Enterprise Rent A Car for double your bonus dollar. Now, most of the deals are $25 for $$20 bonus dollars. I have a hub on stretching your dollar with Discover Card. So, hypothetically, in the months of the Discover promotional period of January through March, had you filled up 8 time where each time was $50 ($2.5 x 8), you would have been able to redeem a $25 gift card varying from restaurants such as Buca di Beppo to merchandise stores such as Footlocker, etc.
Since your gas purchases may be a great portion of your month expenditure, then why not just find a good cashback card for all of your purchases. Typically, there are many discussions on Fatwallet regarding best cash back credit cards. The most recent cash back deal was Bank of America where you receive a $250 sign up bonus after $500 purchase within 90 days. The card entitles you til 1% cash back on all purchase, 2% on groceries, and 3% on gas. Like the Discover card, there are limits to the bonuses. But the discussion seems to indicate that the deal is gone, so I would check back to the Finance Forum portion of Fatwallet for new deals.
Nowaday, it just seems foolish not to earn cash back for your gas purchases, whether it is 1% or 3% or 5%.