How to Save Money on Gas

Gasoline prices are currently in the headlinese due to the war in Iran. Gasoline is an expense that hits you several times a month and any price increase directly lightens your wallet. Unlike other expenditures there is no material qualitative discount between gas purchased at any reputable gas station. As a result, gas is an easy place to save money with a few simple techniques outlined in this article.

The cheapest station

The simplest way to save money on gas purchases is to go to the cheapest gas station that is conveniently located near you. Gas Buddy is a great app that will show the cheapest nearby station. However, the station that has the lowest headline price may not actually be the cheapest. If you are using a promotion or taking advantage of the other discounts available to you, other stations may end up being cheaper. Similarly, many cheaper gas stations only allow payment with cash or debit. A credit card offer or category bonus may make a more expensive station cheaper than a more expensive station.

For example, the most convenient gas station near me is a Shell that recently charged $6.20 a gallon whereas the cheapest gas nearby was around $5.80. I get about $1 per gallon off from Ralphs (Kroger) fuel rewards and 5% back from my Shop Your Way credit card (no longer available to new applicants) for a total of $1.26 back per gallon, making the more expensive gas station actually $.86 per gallon cheaper.

Debit vs credit

Retailers pay higher fees to accept credit cards versus debit cards and as a result they incentivize you to use debit cards by giving you a lower cost per gallon. All else being equal, you would rather use a debit card. However, if the price difference is less than 1%-2% you may want to still use a credit card as the net total value you will receive from a credit card still may be higher. For example, if the total price difference is 1%, but you have the Citi Double Cash card that earns 2% per dollar spent, you would rather use a credit card and earn an extra 1%.

In many cases credit cards offer higher cash back on gas, usually 3-5%. See the non-exhaustive summary below of credit cards that offer higher cash back on gas:

Note that in almost all cases it is not worth getting a card just to save on gas. The value of a sign-up bonus will still almost always exceed the amount you will save by getting a card that earns more on gas.

In addition to cards that have explicit rewards on gas purchases there are also credit cards that give you a reward on your top category of spend or in a category you choose. The American Express Business Gold is an example of the latter, it allows you to choose two categories including gas and receive 4% on all spending in that category.

Credit card offers

On top of credit card category bonuses, credit card issuers also often have offers for discounts on gas. The discounts usually take the form of spend a certain amount to get a discount, for example Chase currently has 3% off up to $2 on a number of its cards. I use Card Pointers to automatically add all offers to my cards.

Gas station rewards programs

Every major gas station has a free rewards program that gives you a discount of 5-50 cents per gallon. In some cases you need to download and pay in their app. You may receive a card in the mail you can scan or can usually enter your phone number at the pump.

1. 100 points = $.10 per gallon
2. 1,000 points equals $1. 7-11 also has frequent promos.
3. Silver tier 3 cents per gallon, gold after 6 fill-ups or 3 premium fill-ups 5 cents per gallon, platinum after 12 fill ups or six premium fill ups 10 cents per gallon

Grocery store fuel rewards

Major Grocery stores have free rewards programs that usually offer significantly greater discounts than gas station rewards. You can usually sign-up online or in store with your phone number. To use your rewards you select “Rewards” at the pump then scan your card or enter your phone number. You should then see the price per gallon decrease. I wouldn’t switch grocery stores just to take advantage of the fuel savings, but if you are shopping at a store anyway, you might as well get a discount on your gas.

Under these programs you get a certain number of points per dollar spent at a grocery store. In most cases this includes gift cards. The earnings rate is standardized across grocery stores where every 100 points equals 10 cents off per gallon. All major grocery stores chains often have promotions such as 2x- 5x fuel rewards deals on gift cards or specific product purchases.  Each program usually has a maximum discount per gallon of $1.00 or in the case of Winn-Dixie a potentially unlimited amount up to a price of $.01 per gallon and a maximum number of gallons between 20-35 gallons per fill up. If you really want to maximize your savings and have two cars you can fill one up after the other on the same transaction to use all of your gallon rewards.  

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Apps

Every major gas station chain has its own app that is related to the rewards program discussed above. There are also third party apps such as Upside that give you additional rewards, in many cases on top of the station’s existing loyalty program. Fintechs also often have promotions or discounts related to gas. For example, OnePay currently has $1-1.50 per gallon off at select gas stations on Wednesday which stacks with other offers. I would not sign-up for Onepay just to take advantage of this offer as they do not currently have a sign-up bonus, but they have in the past.

Promotions

Gas stations will frequently have promotions where you get an additional 5-50 cents per gallon for spending a certain amount at another retailer or buying a minimum number of gallons per month. These promotions usually stack with the other methods listed in this article. Some retailers also let you stack multiple promo codes. 7-11 in particular has recently had a number of codes that allowed people to get several dollars per gallon in discounts.

Gift cards

Retailers such as CVS, Walgreens, or Kroger sell gas station gift cards. You can create discounts on these cards using credit card offers or buy gift cards to take advantage of grocery fuel rewards. For example, if you have a 10% off coupon at Ralphs , a grocery store owned by Kroger, you can buy $100 of Shell gift cards, get 100 fuel points of 10 cents per gallon, and 3% back by using the Chase Sapphire Reserve card for a total discount of 13% plus 10 cents per gallon on your next fill up.

The Holy Grail, stacking deals

The way to get the greatest discount is to “stack” multiple offers together. Use the heuristic or mental short cut below to think about how to stack an offer.

1. Credit card or gift card
   1. Category bonus
   1. Card offer
2. Rewards program
   1. Grocery
   1. Gas
3. Other promotions

First decide on the value maximizing method of payment. Most of the time it will be a credit card or gift card. For a credit card you should think about which card has a category bonus on gas and a card offer. Use a gift card if you can get a large category bonus or have a card offer you can take advantage of when buying gift cards at a grocery store that let you purchase a gas station’s gift card at a significant discount. Next determine which rewards program to use. Grocery rewards are almost always more lucrative per gallon than the gas stations own programs. Finally if other promotions are available that you can layer on top of these purchases, add them.

Two examples of this in practice:

I use the Citi Shop Your Way card, which unfortunately is no longer available for new applicants but which provides 5% on up to $10k a year in gas spend. It also has a monthly offer of up to 8% on up to $2k in spend on gas, groceries, and restaurants. Both discounts stack so I get 13% off on every dollar I spend on gas. I then use Ralphs’ grocery points to get $1 off per gallon. Using $6.20 a gallon and a 14 gallon tank I would pay $86.80 without any discounts. With the discounts I save $14 from Ralphs’ points resulting in a bill of $72.80 and then 13% off from my credit card for a total of $63.34 or a total savings of $23.46 and $1.68/gal savings!

I use the Onepay debit card which currently has a $1.46 off per gallon at my local Chevron station. I can then combine this with $1 off from Von’s grocery points resulting in $2.46 off  per gallon and using the same 14 gallon tank I would save $34.44. I do not earn any rewards on the debit card, but the total savings is still greater.  

Conclusion

There are a variety of ways to save money on gas via gas station and grocery rewards programs, credit card offers and category bonuses, third party apps, promotions, and buying discounted gift cards. Grocery store rewards and credit card category bonuses tend to be the most consistent and usually lucrative methods to get significant discounts. You can save the most money by stacking or combining multiple forms of savings in one transaction.