Dumb credit card question

BatteryCharger

Flashlight Enthusiast
I am planning on signing up for this credit card that gives a 5% rebate on all gas purchases. (15c/gallon at todays prices!) In the fine print it says:

"The Gas Rebate will be calculated at a rate of 5% multiplied by your total eligible gas volume for that billing cycle and limited to 2% of your total net retail purchase transactions (excluding returns) for that billing cycle."

What exactly does that mean? If I only used the card to buy gas, for example, would that mean I would only get a 2% rebate on gas, rather than a 5%? /ubbthreads/images/graemlins/thinking.gif Math makes my head hurt...

nikon

Flashlight Enthusiast
That seems to be what they're saying. So in order to get the full 5%, you'll have to buy a lot of stuff you don't need.

Wits' End

Flashlight Enthusiast
Keep in mind--
One accidental late payment, or any of several other things that could kick in a penalty fee. Can offset the rebate. "Dumb Credit Card" is something many people who use them say /ubbthreads/images/graemlins/smile.gif

2dim

Enlightened
To answer your question...YES! Figure your average monthly gas cost, then multiply by 50 to find out what total balance on card you'd have to maintain in order to get the full 5% off gas...doesn't seem like a good deal IMO.

paulr

Flashaholic
The way I read it, the 5% gas savings can be no more than 2% of your total card spending in a month. So let's say you spend \$100 on gas. 5% of that is \$5. You get the whole \$5 if your total card spending that month is \$250 or more.

Brock

Flashaholic
Check out the citi dividend card. The only disadvantage is you have to call them to get them to send you a check for the \$ every so often. I used to use a Shell citi card that would just give you credit on your statement for any Shell purchases, but with the citi dividend card you get the 5% at ANY gas station, grocery store or drug store and 1% on everything else. It adds up pretty quick. Check out Citi's site for more info

Samoan

Enlightened
There are so many better cards out there than anything administered by MBNA, FUSA, Citi, or Chase. Take a look at the fee and default rates. Also, depending on the card, make sure you take a *GOOD* look at what they define as a default. With many of the big players being in default means being late with ANY creditor. How would you like to be at 29.74% because you went on vacation and your auto pay failed....

The gas rebate cards *can* be competetive but the rates are generally much different from the ads if you'er not Tier 1.

Although they may not offer all the advantages of some of the big players check out the offerings from one (or more) of your local credit unions. What good is a rebate is your interest rate is high?

FYI, check our CU's chartered/located in Texas. Rates are capped by law at <18%. Anything above that is usury and is illegal.