A part of the popularity right now relates to how fast gas prices have been rising lately. Over the past few years gas prices have gone up and down significantly, but far more up than down. This means that people are spending more money at gas stations and want to get more for their money.
What Are the Benefits?
Gas rewards cards are much like other rewards credit cards. You spend money, you get rewards. The difference is that you get a higher percent back on your gas purchases, generally around 3-6%. These rewards are generally given as a rebate on your credit card. Sometimes you may be able to get other kinds of rewards.
Sometimes your card may even give you a free tank of gas, just for being a good customer. What you get depends on which card you have.
What's the Cost?
You know nothing in life is free. You can't expect that a credit card company is going to be giving you money back just for the privilege of your business. They must want something.
The cost is most often a higher interest rate. Some may have annual fees as well, but a higher interest rate is more common. An annual fee can mean that you have to spend a fair amount before your rewards beat out what the card is costing you right off the top.
What Should You Look Out For?
When you think you have a card you want to apply for, look carefully at the terms. Sometimes it can be hard to get the best return on your cards. The rebate rate may be written as "up to" 1% for non-gas purchases, for example. The exact rate may vary by how much you use your credit card.
You also need to be aware of card maximums for rewards. If you are a big spender you may find that you come up against your rewards limits.
Are They Worth It?
That depends on you. How do you use your credit cards? If you carry a balance, you'll never buy enough gas for it to be worth the higher interest rate. It's just not possible.
On the other hand, if you rarely or never carry a balance, the interest rate isn't going to matter to you at all. Pay your credit card off and you are getting the rewards without paying extra for the privilege. It's a great deal in that case.
