It’s about the savings and the convenience. Mostly the cash back or the rebate savings. Gas credit cards can potentially save you, or give you back depending on how you look at it, hundreds of dollars over the course of a year. Maybe not enough for a week long Caribbean cruise, but potentially enough for a weekend for two in Las Vegas or New York.
However, to enjoy these rebates and potential savings, you must avoid some common pitfalls associated with the use of gas credit cards.
The first common pitfall to gas credit card usage can actually be categorized as a danger, and it’s something we’re all familiar with: debt. For almost all intents and purposes a gas credit card functions in the same way as a conventional credit card: you use the card frequently, but only make minimum payments or neglect to pay the balance off. . . and you accrue debt. It’s simply too easy for some people to pay only the minimum monthly payment and unwittingly over the course of a few months build up thousands of dollars in credit card debt because of the interest. Unfortunately, this is not the way to utilize a gas credit card to its fullest potential. In fact, you should avoid leaving any type of monthly balance on your gas credit card in order to see the biggest benefit.
Another pitfall you may run into when choosing a credit card for your fuel purchases is that if you do a lot of travelling, whether it be near your home or hundreds of miles away; you should use caution when choosing a company specific gas credit card. Company specific cards often offer additional rebates or incentives over a conventional gas credit cards – but the downfall when using company specific cards is that your greatest rebates and savings usually only apply when you’re fueling up at the particular gas station chain. While this will work out well for you if you’re always refueling at your local fill station, it’ll do you little to no good if you’re constantly on the move and filling up at various gas stations within your own city or while you’re on the road.
One more thing to take into consideration with a company specific gas credit card: if you’re one who likes to shop around for the lowest gas price in town. . . you probably should consider a different card type as it’s a rarity that the same gas station chain will have the lowest price every time – especially with as much as the gas price fluctuates now.
So – how can you get the most out of choosing and using a gas credit card? For one, probably choose a gas credit card that gives you rebates and/or discounts at a multitude of locations. Stay away from the company specific gas credit cards unless you’re a light traveller that is loyal to a certain company, then using a company specific gas card might be rather advantageous for you. Also, paying off your balance on a monthly basis is very helpful. A gas credit card will do you no good in terms of rebates or cash back if you’re paying hefty interest on your card because of an unpaid balance. The best way to avoid that is to take care of your balance on a monthly basis; don’t go overboard on non-fuel purchases and use your gas credit card solely for the purchase of gas, not all the extras.
Gas credit cards can prove to be beneficial in terms of helping you to save money at the pump, provided you avoid some common pitfalls.