Intro: Did you cry the last time you filled your gas tank? You're not alone. Gas prices are only going up and if you're searching for some relief, we're here to help show how you can finagle more gas for less cash.
Take Double Shot: One guy who knows a lot about credit cards and finances in general is Bankrate.com's Senior Financial Analyst, Greg McBride ... he's here to explain how gas rewards credit cards can help you save at the pump.
Kristin: Greg, let's start with the cardinal rule of rewards credit cards.
Greg: Always pay the balance in full every month. If you carry a balance even occasionally, forget about rewards cards and instead focus on finding the lowest possible interest rate to minimize your finance charges. Rewards cards charge higher interest rates, and on any card, the interest rate dwarfs the reward payout.
TAKE B-ROLL/Lower-third reveals:
-Pay balance in full
- Look for lowest interest rate to minimize finance charges if you carry a balance
-Rewards cards charge
Kristin: What are some ways gasoline rewards credit cards can ease some of the pain at the pump?
Greg: If you use the same brand of service station every time, look at that company's co-branded reward card. You may find the payout is as high as 5% on purchases at their gas station, with the ability to earn as much as 1% back on purchases everywhere else. But if the card is only useable at the service station - and nowhere else - or if the payout is a fixed number of cents per gallon purchased, this isn't the card you're looking for.
Kristin: What if you use different brands of service station and not the same one every time?
Greg: Nearly half of the cash back cards surveyed by Bankrate.com have higher payouts for certain categories of purchases, and gasoline is one of them.
TAKE B-ROLL of gas-branded stations
So your cash back card may offer a higher payout regardless of which brand of gas station you go to, but assess your overall spending patterns and select a card that pays out the most in the categories where you spend most of your money - whether it is supermarkets, gasoline, or travel. Also beware of rotating categories where you must sign up each quarter for the higher payout.
Kristin: What if gasoline costs more on credit than it does on cash? Doesn't that wipe out the reward? And if so, what can you do?
Greg: Buy gasoline gift cards at the supermarket, using your rewards card. Then pay at the pump using the gift cards - you'll get the more favorable cash price and already have banked the cash back or reward points by having purchased the gas card at the supermarket.
TAG: And of course we always want to remind consumers that in order to reap the most rewards, you should shop for the credit card that fits you best ... along with the best interest rates by visiting the credit card rate tables. Thanks for watching, I'm Kristin Arnold.