The Best Cash Back Reward Credit Cards for Buying Gas
With gas prices skyrocketing, I thought it would be worth putting together a roundup of the best credit cards when it comes to cash back rewards on gas purchases. Unfortunately, the American Express has announced that, effective immediately, they are reducing the reward on gas purchases made with the AmEx Simply Cash Business Card from 5% to 3%. That’s the bad news. The good news is that there are still some pretty sweet deals out there.
What follows is a rundown of three of the best options for “mainstream” gas reward credit cards. While there are a number of brand-specific offers available, I much prefer to be able to choose amongst gas stations based on price as opposed to being tied down to a single brand. Here goes…
» Blue Cash from American Express
This card offers one of the best cash back rewards programs available. Here’s the scoop… For your first $6500 in annual purchases, you’ll receive 1% cash back at gas stations, grocery stores, and drugstores and 0.5% everywhere else. But once you get past the $6500 threshold, you’ll receive 5% cash back on gas, grocery, and drugstore purchases and 1.5% on everything else. With gas hovering around $4/gallon, that translates into a savings of $0.20/gallon just for swiping your card. Another great thing about this card is that there is no limit on the amount of rewards you can earn. This card has no annual fee.
» Discover Open Road
This card offers 5% cash back on gas purchases as well as automotive service, and it also has a 0% balance transfer offer. On the surface, this sounds nearly as good as the Amex Blue Cash Rewards card. There is, however, a catch… The 5% reward tier applies only to your first $100 in qualifying purchases per month. Given current gas prices, and assuming that you get decent mileage, you’re probably better off with a different card if you drive more than 500-750 miles per month. This card has no annual fee.
» True Earnings Card from Costco and AmEx
This is technically a business card, but anyone can apply for a business credit card. The beauty of this card is that it gives you a 3% discount on the already cheap gas prices at Costco (as well as elsewhere). You also get 3% back at restaurants and 1% on all other purchases. If you’re already a Costco member, the True Earnings card is definitely worth checking out. This card has no annual fee. Unfortunately, our nearest Costco is close to an hour away, so this one doesn’t work for us.
Published on July 1st, 2008 - 28 Comments
Filed under: Automotive, Credit Cards
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Do you know if the Blue Cash card $6500 is based on calendar year or card anniversary year? Maybe it is time to try it…
Comment by Patrick Szalapski — Jul 1st 2008 @ 6:51 pmI have always received my bonus from Amex in January, but I cannot remember if that’s my card anniversary or not. I’ve been using it as my primary means of paying for everything since around Christmas and the $244 accumulated so far is quite a satisfying figure.
Comment by Vicky — Jul 1st 2008 @ 6:56 pmI just opened an AmEx Simply Cash Business Card a month ago because of the 5% gas rebate. ARG!!!
I plan on buying a house within the next 2 years so I don’t want to mess with my credit score too much. If I didn’t have a house purchase on the way I would probably get the Blue Cash from AMEX.
Comment by Matt — Jul 1st 2008 @ 7:09 pmPatrick: It’s based on your card anniversary date, though in my case (and presumably Vicky’s) that nearly the same as the calendar year.
Matt: A small number of card apps won’t have much of an effect on your credit score, and it’s typically a short-lived effect. See here for more details.
Discover open road for me. I have AmEx, but I don’t spend enough to get the higher rate, so I only use AmEx for items where their doubling of warranty may come in useful. For gas I use Discover.
Comment by kitty — Jul 1st 2008 @ 7:51 pmThink the AMEX kickback comes on an anniversary, not on a standard preset day of the year. I get mine in April. However, mine’s from Costco.
Comment by Funny about Money — Jul 1st 2008 @ 8:23 pmYeah, the Blue Cash is pretty sweet. I also use the Chase Freedom card. It pays 3% on the top 3 of 15 categories, one of which is gas.
The nice thing about the Chase Freedom card is that the gas rebate is a flat 3% instead of starting out at 1.0% for a while before becoming 5% at the magic $6,500 mark. Because of the tiering, the Freedom card can sometimes end up paying a person more in gas rebates than the Blue Cash — depending on what the person’s spending levels are.
Comment by Jim @ Cash Back Ideas — Jul 1st 2008 @ 8:29 pmJim: You are correct, sir. I usually use the Freedom card for gas early during the year until I break the $6500 spending threshold.
nice round-up, thanks. i recently researched gas cards and in the end opted for a BP credit card through chase. there’s three stations within a mile of me, and the 10% back for this summer couldn’t be beat. the 5% thereafter isn’t bad, either…
Comment by PiggyBankBlues — Jul 1st 2008 @ 9:20 pmCitibank Simplicity Card is what I use.
Comment by livingalmostlarge — Jul 1st 2008 @ 9:44 pmlivingalmostlarge: I’m confused… As far as I know, the Citi Simplicity card is no longer available (though they’ve presumably allowed existing accounts to remain open). But more to the point, wasn’t the 5% cash back on gas and groceries just a 12 month promo, at which time it fell back to 1%?
the True Earnings Card from Costco and AmEx gives you 3% back on ALL gas, not just costco gas.
Comment by FlatGreg — Jul 1st 2008 @ 11:47 pmFlatGreg: Correct. But if I were to buy gas elsewhere, I would use a card that gives me 5% cash back. But I’ll add that clarification.
One more thing True Earnings Card from Costco and AmEx gives you is 2% on travel expenses such as flights, car rentals, and hotels. You do have to spend the rebate at costco though.
If we ignore this though (to make the comparison easier) The blue cash card will give you a bigger rebate if you charge over $13k a year, the true earnings will give you a bigger rebate if you charge under $13k a year. If you spend exactly $13k, they both give you 3% back on gas and 1% back on everything else.
Comment by FlatGreg — Jul 2nd 2008 @ 12:20 amAgree w/PiggyBankBlues on the BP Visa Card. 10% back on BP Gas (which is the least expensive where I live anyway) for the first 60 days, 5% back afterwards. No fee, and 2% (4% first 60 days) on dining/travel, 1% (2% first 60 days) on everything else. Driving 500+ miles/week makes this one my default choice…
Comment by T-R-A — Jul 2nd 2008 @ 5:05 amI use a regular Discover Card. They have these “more” bonus categories that rotate every 3 months. Starting July 1st to September 30th, they offer 5% on gas, and hotels (and maybe another category). It is free to sign up and is just a click on their website. I also have a Chase Freedom card that offers 3% on the top 3 categories and 1% on everything else. There is a limit though for both of these. The discover card has a limit of 5% for the first $400, and Chase is $600 for the 3% bonus. No limit for the 1%.
Although I will never spend $400 per month on gas, others might, so it is good to know there is a limit.
Comment by Dave — Jul 2nd 2008 @ 8:31 ampenfed credit union has a card that gives you 5% back on all gas purchases paid at the pump with no max and no threshold to reach first. If you can’t find a way you qualify to join the credit union, you can pay a $20 membership fee to the National Military Family Association which qualifies you for membership.
I was going to do this until I found a local credit union that I could join that has the same kind of card.
Might be worth checking your local credit unions if penfed isn’t for you.
Comment by Norm — Jul 2nd 2008 @ 9:11 amNope for life 5% cash back on gas, drug store, groceries and 1% on everything else. Limit is $300/year in earnings though.
We got the card a long time ago and it still gives us massive rewards. They cancelled it I think because people were using it too much or something.
It’s now citibank simplicity rewards, not nearly as lucrative.
Comment by livingalmostlarge — Jul 2nd 2008 @ 11:37 amYou’re lucky they grandfathered you in with the old deal. They usually just slash rewards across the board regardless of how long you’ve had the card.
The penfed card is really nice, they reimburse your 5% as a statement credit every month. No hassles.
Comment by Justin — Jul 2nd 2008 @ 4:11 pmI am not sure if they still offer it, but I have a Shell Gad Card (Also a credit card) that gives me a 5% rebate on all fuel purchases and 1% on everything else. My wife and I share a card and use in ONLY FOR GAS. So, at $4.00 a gallon, with the 5% rebate, we are actually paying $3.80 a gallon for gas. Not too bad. The only catch is you only get the rebate at Shell gas stations. This is not a problem since there are several by my home and they are actually the cheapest around (currently 3.89$). Thoughts?
Comment by James — Jul 2nd 2008 @ 10:35 pmActually, if you are a Costco business member (which you do have to have a business name and license), you get 5% back on gas anywhere, 3% for eating out, 2% on travel, and 1% on everything else. Plus, you get a free membership to Hertz #1 Gold. This is really cool, as when I go on a business trip I get an instant savings on the rental for the Gold card, then an instant 5% savings on the rental on top of that (charged back to the card as credit), and then 2% for the travel rebate. Mariott hotels also give the same deal. By far the best cash back card for a business owner, and last year I got back 500 bucks. This year, with my new job requiring more travel, I will probably get about 1000 cash back, and most of that money was reimbursed by the company.
I only keep a world points Visa card for places that don’t take Amex, which is getting to be fewer and fewer establishments.
Comment by Steve — Jul 3rd 2008 @ 3:17 amThe Costco Amex rebate is paid out with your Feburary statement yearly. The Costco 2% rebate for your executive membership is paid out on your costco anniversary date. Sometimes people get the two mixed up if they have both.
Comment by Ed — Jul 4th 2008 @ 1:46 amYou don’t have to spend it at Costco if you don’t want to. If you go to membership and ask them to cash either payout they will.
It is usually not a problem with us because we alway spend the amount we get back at Costco anyhow.
It is too bad that you cannot find a better response than suggesting people get credit cards to save money. A credit card is the last thing strapped people need to save money. Listen to Dave Ramsey.
Comment by Jacky — Jul 4th 2008 @ 6:57 pmJacky: I post all kinds of money saving tips here - click around. If you have self-discipline, swiping a credit card is a fantastic way to save 5% on gas. And the higher the price of gas goes, the more valuable this discount will be.
For my gas purchases I use the Barclays Gulf Platinum MasterCard. It gives me 3% on Gulf purchases, and I have 2 Gulf locations near my home and they are the closest gas stations to my home so it works out that way.
I know BP and Shell have better rates at 5%, but I have been using this card for years and the rewards is in the form of Gulf Gas gift cards, so when I go to the station next I just pay with Gulf gift cards and essentially get free gas!
Anyone else have this card? Do you like it of hate it?
P.S. Ooops, Looks like they now offer 6% on Gulf Gas!!!! That is the highest I know of if you can dedicate yourself to one brand, though knowing Juniper/Barclays they will make me reapply for a new account! not just change my rewards T&C. Ughghg
Comment by ns — Jul 9th 2008 @ 10:24 amns: That’s a 60 day promo, at which time you fall back to 3%. Why not get an unbranded 5% card? That way you can get 5% everywhere, included Gulf.
Another plug for the PenFed card. 5% gas, 2% groceries and 1.25% everywhere else. Also, the cash back is credited MONTHLY… no more waiting a year for your bonus!
https://www.penfed.org/productsAndRates/creditCards/rewardCards.asp
Comment by Oliver Aaltonen — Jul 9th 2008 @ 1:21 pm