The best rewards at the pump don't come from gas cards
Small business owners have some better options to choose from
Dear Cashing In,
I just took a job that requires a long commute, minimum one hour each way. I also run a small business on the side that sometimes requires road travel. Given that it now costs about $50 to fill my tank, I'm looking for a credit card that will help me save some money on gas and car travel in general. What are the best options? -- Dave
I'm not surprised you're feeling that commute. With gas averaging $3.35 per gallon in the U.S., 10 hours of driving a week must be getting costly. The US Energy Information Administration expects prices to average $3.44 a gallon next year, so you're smart to be looking for a break.
Lucky for you, there are rewards cards that offer significant bonuses for that particular expense, especially for small business owners. Some cards offer them as revolving category bonuses that change every quarter, but a few reward gas purchases year-round.
One credit card designed specifically for gas savings is the Chase BP Visa, launched in March. Through its Pump Rewards program, cardholders get a 15-cent-per-gallon rebate for every $100 spent at BP and can redeem them for up to 20 gallons at the pump. Because you can only use the rebate reward on one fill-up, the program favors vehicles with large tanks over compact cars. The APR is relatively high -- 19.24 percent --but there is no annual fee.
With the Discover Open Road credit card, you don't have to stick to one gas station. You get an automatic 2 percent cash reward on the first $250 spent on gas and restaurants each billing period. This card comes with no annual fee and no interest on purchases for 14 months.
American Express Blue Cash Preferred offers 3 percent back at gas stations and select department stores, and 6 percent back on the first $6,000 spent at supermarkets. It charges a $75 annual fee, but the company is now offering a sign-on bonus of 150 Rewards Dollars if you spend $1,000 in the first three months of card ownership. That should pay for two years' worth of annual fees.
Chase Freedom is one of those cards with revolving categories but it's offering 5 percent cash back on up to $1,500 spent at gas stations during six months of 2013 -- between January and March and July through September. The card also offers 5 percent back on drugstores, restaurants, departments stores and movie theatres, among others, but gas is the only category that appears twice, which tells you tells you something about customer demand right now. You do have to remember to register every quarter but there's an app that downloads automatic reminders to iCal, Outlook, Google and Yahoo calendars.
However, that business you run on the side qualifies you for the Chase Ink cards, which offer similar gas savings, but beat those other cards in sign-up bonuses alone. Ink Cash card has no annual fee and offers a sign-up bonus worth $200 if you spend $3,000 in the first three months. You'll earn 2 percent cash back on the first $25,000 spent annually at gas stations and restaurants. Plus you get 5 percent back on office supplies, cable services and telecom services on the first $25,000 spent annually, and 1 percent back on all other purchases.
If I were you though, I'd go for the Ink Bold, which offers two Ultimate Rewards points per dollar on the first $50,000 spent annually at gas stations and hotels and 5 points per dollar on the first $50,000 spent annually at office supply stores and on phone, Internet and cable. Best of all, you get a 50,000 point sign-up bonus if you spend $5,000 in the first three months. Points transfer to participating travel programs at a 1:1 value. Given the $95 annual fee is waived the first year, you can't go wrong here.
Meet CreditCards.com's reader Q&A expertsDoes a personal finance problem have you worried? Monday through Saturday, CreditCards.com's Q&A experts answer questions from readers. Ask a question, or click on any expert to see their previous answers.
Published: December 18, 2012
- Card offers on planes – are they worth it? – Credit card applications handed out on planes sometimes come with better rewards sign-up bonuses and other perks, but not always ...
- Foreign ATMs accept US debit cards, but carry backup – U.S. debit cards are widely accepted at overseas ATMs, but carry credit cards, too, to be safe ...
- Splitting reward points from a small business – Credit card rewards usually belong to whoever signed up for the account. But small-business partners should discuss whether to split them up or use them for business expenses ...