Maximizing PenFed Cards: 5% Cashback on Gas and Free Flights

This post contains references to products from one or more of our advertisers. We may receive compensation when you click on links to those products. For an explanation of our Advertising Policy, visit this page.

All too often, the best credit card deals are issued by the usual suspects: Chase, American Express and Citi. There are a bunch of other issuers, but most of the action is happening with the big three.

However, I’ve always heard about “PenFed” cards and recently sat next to a TPG reader on a flight who raved about his PenFed gas card. On top of this, several TPG readers have recently tweeted and emailed me with their positive experiences with PenFed, so I thought it was time to do some research of my own.

The Pentagon Federal Credit Union (PenFed) offers two main rewards cards: The Visa Platinum Gas/Cash Rewards Card and the Premium Travel Rewards American Express. The great thing is that once you are approved for one of them, you can call and have them create you the other card and it will be no additional credit inquiry – they’ll simply split your existing approved credit line for both cards and neither have an annual fee.

The main draw to the 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. In my opinion, the next best cards for gas purchases are the Ink Bold and Amex Premier Rewards Gold which both give 2 points per dollar, but even if you value those points at 2 cents a piece, you are only looking at a 4% rebate. If you value them more than that, it may make sense to use those cards instead.

The Premium Travel Rewards American Express has four key features:
1) Sign-up bonus of 20,000 points when you spend $650 within three months. Those points can’t be transferred to any airlines/hotels, but they can be used at about 1.5 cents a piece towards purchasing any airfare or at 1 cent a piece toward merchandise (like Bose in-ear headsets for 10,600 points). Airfare purchased using points will also earn miles and elite status.
2) No annual fee.
3) 5 points per dollar spent on airfare. Considering points can be used for 1.5 cents a piece when redeeming for airfare, this is like a 7.5% return spent on airfare – pretty nice.
4) No foreign transaction fee. This is one of the fee no annual fee cards that don’t have foreign transaction fees.

Also, if you are carrying balances on high-APR cards, it might make sense to move them to PenFed, because they are waiving any transfer fees through December 31, 2011, and granting a 4.99% promotional APR on balance transfer for 24 months. Obviously it’s ideal not to carry balances, but if you are paying crazy interest fees carrying a balance on another card (especially on charge cards) you should crunch the numbers and see if this deal makes sense for you.

Overall, these cards aren’t going to get you a ton of first class tickets around the world, but they can save you money on upcoming flights and get you a nice return on gasoline spend. These days every dollar counts!

Applying for these cards is free if you:
a) Are in the armed forces
b) Work for the government in some shape way or form
c) Belong to an association related to the government (there’s a drop down list of options like American Red Cross)
d) Have a relative or housemate who is eligible (armed forces, government worker, etc)
e) You live or work on a military base

Eligibility criteria.. they aren’t too picky

If none of the above, don’t worry. You can also open a savings account (and fund it with a points-earning credit card 🙂 ) with only a $5 deposit. They also give the option of joining Voices for America’s Troops for a one time fee of $15 (and you don’t need to stay a member) or National Military Family Association for a one time fee of $20.
I’m holding off on any new applications because I’m in the process of getting a mortgage, but I think I’ll get these when the dust settles. While I won’t shift much of my spend away from my workhorse cards (Sapphire Preferred and Premier Rewards Gold), at a very minimum getting these cards is like getting $300 towards travel and a permanent 5% discount on gas – not bad since there are no annual fees.

Feel free to share your experience with PenFed credit cards!

The Platinum Card® from American Express

The American Express Platinum card has some of the best perks out there: cardholders enjoy the best domestic lounge access (Delta SkyClubs, Centurion Lounges, and Priority Pass), a $200 annual airline fee credit as well as up to $200 in Uber credits, and mid-tier elite status at SPG, Marriott, and Hilton. Combined with the 60,000 point welcome offer -- worth $1,140 based on TPG's valuations -- this card is a no-brainer for frequent travelers. Here are 5 reasons you should consider this card, as well as how you can figure out if the $550 annual fee makes sense for you.

Apply Now
More Things to Know
  • Earn 60,000 Membership Rewards® points after you use your new Card to make $5,000 in purchases in your first 3 months.
  • Enjoy Uber VIP status and free rides in the U.S. up to $15 each month, plus a bonus $20 in December. That can be up to $200 in annual Uber savings.
  • 5X Membership Rewards® points on flights booked directly with airlines or with American Express Travel.
  • 5X Membership Rewards points on prepaid hotels booked on amextravel.com.
  • Enjoy access to the Global Lounge Collection, the only credit card airport lounge access program that includes proprietary lounge locations around the world.
  • Receive complimentary benefits with an average total value of $550 with Fine Hotels & Resorts. Learn More.
  • $200 Airline Fee Credit, up to $200 per calendar year in baggage fees and more at one qualifying airline.
  • Get up to $100 in statement credits annually for purchases at Saks Fifth Avenue on your Platinum Card®. Enrollment required.
  • $550 annual fee.
  • Terms Apply.
  • See Rates & Fees
Intro APR on Purchases
N/A
Regular APR
N/A
Annual Fee
$550
Balance Transfer Fee
See Terms
Recommended Credit
Excellent/Good
Terms and restrictions apply. See rates & fees.

Editorial Disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airlines or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

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.