The Pros and Cons of Gas Credit Cards

Gas credit cards are very common and offered by many different finance companies. They are often offered in conjunction with a particular brand of gas station. This type of program has several benefits and drawbacks associated with it. Here are the pros and cons of gas credit cards. 

Pros

  • Discounts- One of the biggest benefits that comes with using a gas credit card is the discount that comes with it. Many of these programs offer you a certain percentage off of your gas purchases. For example, you might get 5% cash back on all of your gas purchases at a particular retailer. Gas is something that nearly everyone has to buy anyway. When you can get 5% off of what everyone else is paying, this can be a major advantage in your monthly budget.
  • Rewards- In addition to offering cash back, many gas credit cards also offer rewards programs. For each dollar that you spend with the card, you will get a certain amount of points that you can use to buy things. These reward points could be used for travel, merchandise, or entertainment items. It usually takes time to accumulate these points, but when you have enough for a reward, it comes as a nice bonus.
  • Convenience- When you have a gas credit card, it is extremely convenient. You simply pull up to your favorite gas station, pay at the pump, and go on your way. Then at the end of the month, you get a bill for your gas purchases and you send them a payment. You are essentially making one transaction each month for gas instead of several smaller ones. 

Cons

  • Interest charges- One of the biggest drawbacks to using a gas credit card is the interest that is charged on the card if you do not pay your balance. When you accumulate a balance on the card and decide not to pay the entire bill in full each month, you will be charged interest on the balance. The interest rates that they charge are very high and will result in you giving back the savings that you accumulated by using the card in the first place.
  • Budgeting problems- Another problem with using gas credit cards is that it can make your monthly budgeting difficult. When you buy gas without a gas credit card, you know exactly how much you spent as it comes out of your account immediately. When you use a debit card, it is easy to keep track of the expenses with your online banking account. When you use a gas credit card to purchase your gas, it is very easy to lose track of how much you have spent. It will require you to log on to your credit card account access regularly to see how much you have spent. Then you have to save that amount of money to pay your bill with at the end of the month. This has caused many people to overspend and not realize it until it is too late. 
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