Originally Posted On: https://www.iquanti.com/
Is a gas rewards credit card right for you?
If you drive frequently or are planning a big road trip, you may be wondering if a gas rewards card is right for you. After all, you could earn perks for all of those miles on the road. However, is a gas rewards card worth it? Do they offer any other perks besides gas benefits? In this article, we’ll cover types of gas rewards credit cards, how gas rewards cards work, and whether getting one is the right decision for you.
Types of gas rewards credit cards
There are two major types of gas rewards cards:
- Gas rewards credit cards from credit card companies: Gas credit cards issued by credit card companies are the most flexible type of gas card. Since they aren’t affiliated with one retailer, you won’t have to worry about being limited on where you can use your card. These cards are best for drivers who want ease of use and don’t plan on just going to one station or gas provider every time.
- Station-affiliated gas credit cards: Station-affiliated gas credit cards can offer great rewards, but you’ll only be able to use your card at specific gas stations. These cards are ideal for drivers who already go to the same station every time or don’t mind being limited in where they can use their card.
Which type should I choose?
Whether you should choose a gas rewards credit card or a station-affiliated gas credit card depends on how much of your spending is done at gas stations.
Gas credit cards will tend to offer a larger variety of rewards, with bonus cash back for gas as well as other categories such as dining or grocery spending. Station-affiliated gas credit cards may offer a better cashback percentage on gasoline, but fewer additional bonus categories, so you may get a lower cashback rate on other purchases.
Some cards may also have a limit on the number of gallons that get bonus cashback either on a monthly, quarterly or yearly basis, which is another important factor to look for if you buy a large amount of gasoline.
How do gas credit cards work?
Gas station credit cards offer rewards like cash back or points for gas. Many also offer rewards in other categories, such as restaurants or hotels. The best gas credit card for you is one that suits your lifestyle and offers rewards on categories other than gas that you’ll use most. Rules vary among issuers so many sure to read the fine print before you sign up for a gas rewards card.
Will a gas rewards card improve my credit score?
A gas rewards card can help you improve your credit as long as you use it responsibly. Make sure to pay your balance on-time and in full. Remember, carrying a balance month to month will cause you to incur interest charges. You’ll also want to watch your credit utilization ratio, which is a comparison of the amount of credit you’re using compared to the total amount of credit available on your card. Most issuers prefer to see this ratio be below 30%.
The bottom line: Should I get a gas rewards card?
A gas rewards card might be right for you as long as you select a card with rewards categories that you’ll use most. Be sure that the card has other value to you other than just gas perks. Other factors to consider include whether the card has an annual fee, if there’s a sign-up bonus, and how easy it is to redeem the rewards.