Pros and Cons of using Gas Credit Cards

The choice on whether to go for gas credit cards or use other financial tools at the pump is not an easy one. This cashless system is marketed as a convenient and easy way to fuel your car. That said; there are high rates and other limitations to contend with. To help you make an informed decision, here are the pros and cons of using gas credit cards.

Pros

Discounts on Purchases

Gas Credit CardsGas Credit CardsOne of the driving factors of having a gas credit card is the discounts associated with their use. With most of these cards you get to pay less per gallon than the fuel pump price. Considering the ever increasing gas prices, this cash backs can go a long way in saving you money which can go towards other purchases.

These programs are structured in a way that you get larger discounts during the first few months after card issuance. For example, the ExxonMobil fuel card offers 12 cents off per gallon for the first 2 months and 6 cents off thereafter.

Accumulating Reward Points

Another incentive to using a fuel card is the reward program. These are points per gallon that you accumulate with each gas purchase. A typical reward of 1 point per gallon gives the average American driver about 540 points yearly. This calculation is based on an estimate of 25 Miles/Gallon and 13,476mi which is the average annual miles per driver. Reward points can be redeemed once they accumulate to 100 and over. These can be used for gas or other needs like snacks and carwashes at select businesses.

A Hassle-free and Convenient Payment System

When using cash, one has to line up at the till to pay for gas. This can lose you precious time from your busy life. However with a gas card, all you need is to pull up at the gas station, fuel and swipe at the pump and in a few minutes you are back on the road.

Another plus on using a gas card is the convenience that it offers. This comes in handy because you may not always have cash to fuel your car. Just like other credit cards, you get billed at the end of the month for your purchases. This helps you in keeping track of your gas bill; essentially making you stick to your budget.

Cons

High Interest Rates

One of the major disadvantages of using a gas credit card is the high interest rates that they attract. On average they charge 24% on interest. That is 9 percentages points more than the average rate for all credit cards which is currently at 15% APR. A card whose balance is not cleared at the end of the month can end up accruing a sizable debt. This may be much more than the discounts and rewards can make up for.

Simply put, continued misuse of the card can lower your credit score. One of way to mitigate this is going for cards with a 0% introductory offer. This will at least cushion you for a few months as you get your gas budget in order.

Ease of Spending

When using cash, you can’t gas your car with more than what is in your wallet. A gas card on the other hand eliminates this ‘inconvenience’. However the card can lead to uncontrollable spending with total disregard to your budget.

Think of it this way; without gas money, you will probably have to do with public transport. This will unconsciously save you money when you are cash-strapped. But why would you go through the hassle if that small plastic card can fill up your tank?

Usage Limitations

If you depend on your credit card for all your fueling, you may find yourself with fewer options on where to buy. This is because the cards are mostly issued by gas stations to be used in their own branded outlets. This puts you at a disadvantage if you move or drive to a state where the brand doesn’t operate, or has few outlets.

Bottom Line

Gas credit cards are a convenient way of fueling your car. They come with reward points and can save you money via their discount programs. The advantages can however be diminished by high interest rates and the danger of overspending. It is therefore advisable to weigh both the pros and cons before you make your decision.

Source: creditabsolute.com

American Express Business Platinum 150,000 Points Bonus (15k Spend)

The Offer

Many people are seeing an increased signup bonus on the American Express business Platinum card when using a incognito mode:

  • Get 150,000 Membership Rewards points after you spend $15,000 within 3 months of signup.

Card Details

  • Annual fee of $595 is not waived the first year
  • Card earns at the following rates:
    • 5x points per $1 spent on purchases made with airlines or hotels booked directly from AmericanExpress Travel website
    • 1.5x points on qualifying purchases of $5,000 or more
    • 1x points on all other purchases
  • $200 airline incidental credit per calendar year
  • Lounge access:
    • Centurion lounge access
    • International American Express lounge access
    • Delta SkyClub lounge access
    • Priority pass select membership
    • Airspace lounge access
  • Marriott Gold status
  • Hilton gold status
  • Fee Credit for Global Entry or TSA Pre✓
  • No foreign transaction fees
  • View these other hidden benefits
  • SoulCycle benefits
  • You can only get the sign up bonus on American Express cards once per lifetime.

Our Verdict

Better than the recent 130,000 point bonus. I suspect this won’t show up for everybody and it should show even if using a referral link but again won’t always show. Fantastic deal if you’ve never had the Business Platinum before (if you have you won’t get the sign up bonus). Will add this to the best credit card bonuses. As always you can read more about American Express cards here. There is also an increased offer of 90,000 on the business gold (possibly even higher).

Hat tip to TheTaxman_cometh

Source: doctorofcredit.com

GAP To Move Card Issuers From Synchrony To Barclays ($1 Billion)

WSJ is reporting that GAP will change credit card issuers for it’s private label and co-branded credit cards for brands such as Athleta, Banana Republic and Old Navy. The existing issuer is Synchrony and the new card issuer will be Barclays. Synchrony has previously held this relationship for approximately 22 years.

The changeover is expected to happen sometime around April 2022 when the existing contract ends and Synchrony is expected to earn $1 billion from the sale. As part of the sale Barclays has purchased the backbook meaning that existing cardholders will be brought over to Barclays in the sale.

Unfortunately it’s probably bad news for all of the spending offers we regularly see on these cards, as previously 80% of the card programs cost was incurred by GAP.

Hat tip to reader John L

Source: doctorofcredit.com

American Express: Three Months Of Yahoo Finance Plus For Free

The Offer

Direct link to offer

  • American Express is offering three months of Yahoo Finance Plus for free and 50% off the next three months

The Fine Print

  • This offer is available only to US American Express Card Members and for a limited-time only, ending 10/1/2021.
  • Trials are only available to new Yahoo Finance Plus Essential subscribers.
  • For the complimentary 3 Month Trial and 50% off the immediately following 3 Months to the Yahoo Finance Plus Essential subscription service, you will be charged 50% off the $35.00 plus tax monthly rate ($17.50 plus tax) for three Months after your complimentary 3 Month Trial ends.
  • You will be charged the full monthly amount of $35.00 plus tax after your first 6 Months and charges will continue monthly at the current rates unless you cancel your subscription.

Our Verdict

Make sure you cancel membership if you don’t want it long term as this enrolls you in auto billing. Probably not that useful.

View more Amex offers here & if you have any questions abut American Express offers then read this post.

Source: doctorofcredit.com

Which Debt Repayment Strategy Is Right for You?

We’ve focused on giving you the information you need to know to get rid of your credit card debt once and for all this month. So far, we’ve explained how to get your debts organized and how to balance building up your savings while paying down debt.

Today, we want to discuss how you can choose a debt repayment strategy to make sure you stay on track and reach debt freedom as soon as you can. These methods can help you power through and repay every last balance.

The Debt Snowball

The debt snowball is a debt repayment strategy popularized by financial guru Dave Ramsey. This method asks you to take stock of all your debts — loans, credit cards, mortgages, and other lines of credit with balances — and list them in order of smallest balance to biggest.

That’s the only factor you need to take into account. So, for example, if you have three student loans and owe $5,000, $10,000, and $15,000 respectively, that’s exactly the order you list them out in. And that’s the order you’d work to pay them off in, too.

The debt snowball has you put as much money as you can toward your debt with the lowest balance first, while still maintaining minimum payments on your other balances. Once you repay that first debt, you take the amount of money you were applying toward it, and combine it with the minimum payment you were making on the loan with the second-lowest balance.

Your payment on this second-lowest balance loan “snowballs,” because the payment is the combination of what you paid toward the first loan and the minimum payment you were already paying on the second.

You’ll continue to snowball your payments and knock out your debts one by one, until you’re debt free.

The Debt Avalanche

The debt avalanche is another system for repaying your debt. With this strategy, you again take stock of all your debts and list them out — but this time, you’ll order them by interest rate.

With the debt avalanche, you’ll list them out in order from highest interest rate to lowest (regardless of balance). Then you’ll work to repay the balances in that order, taking out the loan with the highest interest rate first, then the second-highest, and so on.

The only difference from the debt snowball is the order in which you repay your loans. The biggest advantage to the avalanche is, from a mathematical standpoint, you come out ahead because you’re getting rid of your most costly loans first. Because you’re knocking out loans by interest rate, you’ll gradually pay less in interest over your repayment period.

Choosing a Debt Repayment Strategy

There’s no “wrong” way to knock out balances and become debt-free. But there’s probably one strategy that works best for you over other options. So how do you choose the ideal system for your personal situation?

Start by understanding your own personality. The right strategy is likely the one that’s a good fit for you and the way you think. It’s not necessarily about the details of your debt.

The debt snowball does a good job of taking the emotional and behavioral part of personal finances into account. For many of us, money is about more than just the numbers — it’s how we feel and think about it.

The snowball can keep you on track because it gets you to a “win” quickly. Since you’re paying off the lowest balance first, this repayment strategy will likely knock out your first loan faster than other methods of paying down your debt.

This can be the difference between sticking to the hard work it takes to become debt free, and getting frustrated and overwhelmed by the process.

The debt avalanche is, mathematically speaking, usually better than the snowball. That’s because you focus on getting rid of the debt with the highest interest rate first, regardless of balance. This should save you money over the long-term because you’re lessening how much you’re paying in interest.

But if your highest-interest loan also comes with a bigger balance than your other loans, it’s going to take you longer to repay that debt than if you focused on knocking out loans with balances in order from smallest to largest. For some, it’s emotionally tough to have that first milestone be further down the road.

And that’s okay — it feels good to get rid of loans or balances on your lines of credit!

It all depends on what motivates you. If paying off your first loan ASAP will keep you going and prevent you from feeling discouraged or hopeless, choose the debt snowball. If you want to put an end to interest rates eating up your discretionary income, choose the debt avalanche.

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What About Debt Consolidation?

Debt consolidation is another strategy that may be helpful if you’re struggling to keep track of multiple loans and their payments, due dates, and other information. Consolidation can also help those who have high interest rate loans but good credit scores (be sure to check your credit score with a free credit report on a regular basis).

When you consolidate, you start by taking out a single loan for the total amount of the debt you want to repay. You take the borrowed money from the new loan and repay all the individual loans with balances you already had. Then, you work to repay the single, new loan.

This is a good option if you’re feeling overwhelmed because it simplifies your financial situation. Instead of having multiple loans to keep track of, consolidating leaves you with a single loan — with a single interest rate, monthly payment, and due date.

It’s also worth looking into if your current loans carry high interest rates that cost you money. There’s no guarantee, but you can shop around with different lenders to possibly consolidate existing loans for a lower interest rate. This not only simplifies your debts — since, again, there will only be one balance to keep up with — but it could also save you money if you can get a lower interest rate.

Just make sure you take all the fees into account. A new loan may come with a lower interest rate, but the loan origination fees may mean it’s a wash when it comes to saving money. Everyone’s situation is different, so do the math before making any decisions.

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Source: mint.intuit.com

[Targeted] Redeem American Express Membership Rewards Points against Charges with 40% Discount (1 cent-per-point)

Some people are seeing an option to cover their American Express charges by redeeming Membership Rewards points to offset the charge and getting a 40% discount on the redemption. Whereas typically redemptions against charges offer a poor value of .6 cents-per-point, those who have this offer can offset these eligible charges at a full 1 cent-per-point value.

Lots of people get better value than 1-cent from their Membership Rewards points, but this could be useful for those who don’t. If you have a Schwab American Express Platinum card, you can get 1.25 cents per point always.

Hat tip to reader Cavin

Source: doctorofcredit.com

Does Having Multiple Credit Cards Hurt or Help My Credit?

will having several accounts affect your credit? The answer to these questions often comes down to personal habits and goals.

Credit cards are a staple of Americans’ wallets. The average adult has at least two bank-issued accounts, according to Experian’s 2016 State of Credit report. Consumer credit plays a key role in financial health, and, when used wisely, can strengthen your stance in the credit score range and help you secure loans with the best interest rates.

On the other hand, bad credit often leads to higher interest rates and could even disqualify you from the lending process. (Not sure where your finances stand? You can view two of your credit scores for free on Credit.com, which will not hurt them in any way.)

So how many credit cards are too many? And will having several accounts affect your credit? The answer to these questions often comes down to personal habits and goals, and there are several pros and cons to consider.

The Benefits of Multiple Credit Cards

If you’re an experienced and responsible credit user, the benefits of maintaining more than one card could outweigh the risks.

Earning Maximum Rewards

Credit card issuers offer a variety of perks for cardholders. Using multiple cards allows you to strategize and earn for every dollar you spend. For example, suppose you are a frequent flyer who is also interested in funding your child’s education. Card A is tailored to suit travel-related rewards, while Card B’s sole focus is college savings. You can take advantage of multiple benefits by considering your most frequent expenditures and choosing credit cards that align with your goals.

Safety When One Card Is Compromised

Credit card issuers are cracking down on identity theft, but chip technology still isn’t perfect. If your credit information is compromised, your issuer will probably send you a new card and instruct you to shred the old one. If this occurs, it’s useful to have a second option for emergencies.

The Drawbacks of Multiple Credit Cards

While there are potential benefits of maintaining multiple credit cards, there are a few drawbacks worth considering.

Losing Track of Spending

The case for fewer credit cards often comes down to simple math: Fewer credit cards means fewer chances to overspend. If you struggle with budgeting, it can be difficult to curb spending with a high credit limit. You also run the risk of digging yourself into a hole of debt that’s difficult to escape.

Forgetting to Pay a Bill

If your life is chaotic or your memory is lacking, the last thing you need is multiple account balances to keep track of. While it’s possible to create reminders for yourself with budgeting apps, the potential credit damage caused by late payments, fees and accruing interest may not be worth the trouble.

While there is no ideal number of credit cards to keep in your wallet, learning how your credit score is calculated can help you use them wisely. Bolster your score by creating deliberate spending habits and credit usage along the way.

Image: PeopleImages

The post Does Having Multiple Credit Cards Hurt or Help My Credit? appeared first on Credit.com.

Source: credit.com

Chase Freedom Flex Now Works with Samsung Pay & Tap-To-Pay

Update 4/14/21: Reader TKB let us know that Freedom Flex can now be added to Samsung Pay. (Previously it was only working with Google Pay, Apple Pay, and tap-to-pay.)

Update 12/28/20: Reader TKB lets us know that it appears the Freedom Flex is now working with Tap-To-Pay technology.

Another update on 9/21/20: Readers say that you CAN add the card to a mobile wallet; it just doesn’t auto-update. Bottom line: the Flex card will work in mobile wallets, but will not work for tap-to-pay.

Update 9/21/20: Just an addition from reader H. – aside from not working with mobile wallets, the Freedom Flex card also does not work with tap-to-pay.

Original Post:

Multiple readers report being told that if they product change to the new Chase Freedom Flex card it won’t be available in mobile wallets. Readers have confirmed that after the product change, the old card gets deleted from your mobile wallet.

That’s a bummer. Some suggest this is due to being a Mastercard which Chase does not yet have the relationships to get it into mobile wallets (though IHG Mastercard does work in mobile wallet).

I’d expect Chase to work this out in the coming months. I’m honestly surprised they’d launch the product without working out such a kink since it gives people a bad taste about the new card. Hopefully they work it out quickly.

Source: doctorofcredit.com

Abound Credit Union Visa Offers 7% Cash Back On Outdoor Activities (Q2 2021)

The Offer

Direct Link to offer

  • The Abound Credit Union Visa card is offering 7% cash back on outdoor activities during April, May, June 2021. Max $175 in rewards earned per statement cycle.

‘Outdoor activities’ includes: Zoos and Aquariums, Amusement Parks, Sporting Goods Stores, Bicycle Shops, Golf Courses, Sporting & Recreational Campgrounds, RV Parks & Campgrounds.

The Fine Print

  • 7% off at merchants classified by VISA as Zoos and Aquariums, Amusement Parks, Sporting Goods Stores, Bicycle Shops, Golf Courses, Sporting & Recreational Campgrounds and RV Parks & Campgrounds up to $175.00 in rewards earned per statement cycle. After $175 is reached in rewards you will continue to earn 1%.
  • Offer valid April 1-June 30, 2021.

Our Verdict

Nice big earnings rate, some will find this useful during these summer months. Some people might have this card due to it offering 5% cashback on all gas purchases. Seems they are now doing this kind of promo each quarter which could be another reason to get the card.

Hat tip to reader Evan

Source: doctorofcredit.com