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Maximize Points On Gas Spending And Gift Cards

by on August 30, 2012 · 11 comments

in American Express, Chase, Credit Cards, Flexperks

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High gas prices got you feeling like this? (Image: Fotolia)

It’s been a long, hot, expensive summer driving season. Not only have gas prices been rising all summer, but Tropical Storm/Hurricane Isaac will continue to disrupt oil drilling and distribution in the Gulf of Mexico, and we’re looking at more pain at the pump for the foreseeable future. In fact, just yesterday, gas prices jumped 5 cents in a single day, and the national average stands at $3.82 per gallon – a summer record high.

The average American spends about $360 a month on gas (probably a bit more thanks to the high summer prices), so over the course of three months, that’s nearly $1,100. All that makes it even more imperative than usual that we all get the most out of our points when it comes to filling up our cars.

In addition to other great perks, several credit cards earn their members multiple points per dollar spent on gas. So on the earning side, here are some of the best credit cards to carry next time you go to the filling station. Note: I just want to say before I get started that redeeming your points for statement credits or gas cards is not going to be a lucrative proposition, but if you’re strapped for cash and have a lot of extra points sitting around, you could consider using them to offset your costs. I would try to find other ways first, though.

Spending Bonuses and Gas Redemptions

Chase Freedom: As I mentioned in my comparison post last week, from now until September 30, 2012, the Chase Freedom is offering 5% points per dollar spent on the first $1,500 spent at gas stations and restaurants. While that means I’ve been using my Freedom card instead of my Sapphire at restaurants for the time being since 5x points beats the Sapphire Preferred’s 2x in that category, I’ve really been concentrating my gas spending on the card since 5x points is a steal, and then once I max out the $1,500 spending limit, I’ll switch my restaurant spending back to the Sapphire Preferred.

In my opinion, this is the single most valuable earning opportunity on gas – it’s just too bad it’s for only three months! Though the points I earn on the Freedom are nominally “cash back” points, because I have the Sapphire Preferred (and the Ink Bold) I can transfer them to my Ultimate Rewards accounts on those cards and redeem those points for miles on United, British Airways, Southwest, Korean, Hyatt, Marriott, Ritz-Carlton, Priority Club and Amtrak. I’m basically earning 5 United miles per dollar spent, and since I value United miles at 2 cents a piece, that’s like getting a 10% rebate on my spending, especially considering the Freedom card has no annual fee. 

Remember: You have to activate the 5% bonus categories each quarter and you have until September 14, 2012, to activate the current gas station/restaurant categories (thankfully registration is retroactive so you will get credit for all spending that quarter).

The Chase Ink Bold and Ink Plus cards offer 2 points per dollar spent at gas stations, up to $50,000 a year, so it’s a much better longterm solution if you spend a lot on gas.

Redeeming Chase Ultimate Rewards Points for Gas Gift Cards
Exxon and Mobile gift cards worth $10 each for 1,000 Ultimate Rewards points, or a $25 BP card for 2,500 Ultimate Rewards points with free shipping, so your redemption rate is 1 cent per point.

Amex Premier Rewards Gold: When gas is not part of Freedom’s category spend bonuses, I almost always use my American Express Premier Rewards Gold  for gas since the base earning is 2 points per $1 on gas plus Amex gives a 15,000-point bonus when you hit $30,000 in spend, essentially making the first $30,000 spent worth 1.5 points per dollar base earning.

Redeeming Amex Points for Gas Gift Cards
6,500 Membership Rewards points for $50 gas cards, a value of about 0.77 cents each. Obviously, I wouldn’t suggest that unless you’re in a pinch.

Pen Fed Visa Platinum Gas/Cash Rewards card is that they give you a whopping 5% cash back on all of your gas spend, up to $50,000 a year. The rebate even posts with your statement – so if you charge $100 in gas, it’ll only post to your bill as $95. Check out this post for more information on how to maximize the Pen Fed program.

Hilton Cards: Both the Hilton HHonors American Express and the Hilton HHonors Surpass Card from American Express earn spending bonuses at gas stations.  You 6 Hilton HHonors points per $1 you spend at the gas pump with the Surpass, and 5 points per $1 with the Hilton Amex, no matter what the season, while the Citi Hilton HHonors Visa Signature and the Citi Hilton HHonors Reserve Visa Signature Card each earn you 3 Hilton HHonors points per $1 on gas (the Reserve card actually doesn’t offer a bonus, it just earns 3 points per $1 on all purchases except those at Hilton). While you could be earning multiple thousands of HHonors points on your gas spending, remember that even Category 1 properties like the Hampton Inn in Princeton, Indiana, still cost 7,500 points for a free night, so you’d have to spend at least $1,250 on gas for an award. Also, Hilton HHonors points transfer to most airline partners at a ratio of 10 points to 1 mile, so if airline awards are your goal, then you’d be better off putting your gas spend on an airline co-branded card like the Delta Amex or the Citi AAdvantage Visa and the Citi AAdvantage Amex cards instead, even though you just earn one mile per dollar.

FlexPerks Visa: One other card you could consider is the US Bank FlexPerks Visa Signature. Until August 31, the sign-up bonus on the card is 33,150 points thanks to an Olympics bonus promo, and cardholders earn two FlexPoints for every $1 spent on gas, grocery or airline purchases – whichever you spend most on each monthly billing cycle – so in order to take advantage of this bonus spending category, you’ve got to keep a careful tally of which expenses you’re spending the most on. For instance a single expensive airline ticket one month could throw off your whole spending strategy.

Redeeming Flexpoints
You can redeem FlexPoints for between 1.33-2 cents for airfare per the card’s travel redemption schedule, but when it comes to cash back, statement credits or merchandise redemption, cardholders are stuck with a paltry 1 cent per point in value and must redeem in increments of 5,000 points. So, you’d need to make sure gas is your highest expense, spend $2,500 on it to earn 5,000 points, and then you could redeem that for a $50 statement credit – essentially earning a 2% rebate on gas. Not great, but better than nothing or 1%.

The good news is, there are plenty of cards on the market that can earn you anywhere from 1-6 miles or points on every dollar you spend on gas, which hopefully takes away some of the sting of paying nearly $4 per gallon these days. As always, before you commit to a card or a strategy, do some calculations based on your average spending to see which card will earn you the most return on your money and the rewards that you want.

Disclaimer: The responses below are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser's responsibility to ensure all posts and/or questions are answered.

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  • Daw4888

    I would also recommend that people look at the PenFed Rewards Card. It offers 5pts/$1 on gas year round, and also 3pts/$1 at grocery stores. I am not sure how good their travel booking is with points, but you can redeem points for hotel/airline gift cards at 1pt=1cent.

  • Daw4888

    Also I forgot to mention you can get up to $250 in rewards for signing up. $50 for first purchase, and then another $200 after you spend $1,000 in the first 3 months.

    There are MANY ways to be a member of PenFed CU. If you have been a red cross blood donor, you can join that way, or you can always donate $15 to a military charity and qualify to be a member.

  • Ericlipkind

    Also, Discover card has 5% cash back at gas stations through December.

  • Ericlipkind

    I meant through September

  • thepointsguy

    Nice- added to the list

  • thepointsguy

    Great reminder- added it to the list!

  • Jmansour

    You didnt mention the ink which i beleive also gets you double points on gas.

  • Daw4888

    I was referring to the PenFed Platinum Rewards card. It also gives 5% back on gas, but also 3% back at grocery and 1% back on everything else. It doesn’t post the cash back automatically, but instead you accrue points.

    It also gives the signup bonus, where the old PenFed cash rewards card doesnt, and also it only gives .25% back on all non-cash purchases

  • Laura1 Greenberg

    costco AMEX gives you 4% back on gas purchases too (at all gas stations not just theirs)

  • Paul W
  • Yeliad57

    the quarterly limits on the Freedom card’s categories need not frustrate!
    1] gas was Q1 and Q3 this year = 6 months. Thus, $3000 worth of the precious liquid, when you top off the account AT the quarter’s end with station-branded gift cards. All the major gas companies have them at their gas stations. NO ADDED CHARGE! Get ‘em while the tank is filling…
    2] If you’re married, double your pleasure with 2 separate Freedom accounts!
    3] Do the same on grocery quarters, Q2 this year. The major grocery chains all have their own gift cards, again on-site, again no additional charge.
    In our house we are gaining weight and swimming in gas…..and UR points!

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