buying gas with cash vs credit card

[treesner]

Anyone notice that gas station are offering a discounted price for gas if you pay cash vs credit card, or is this just a California thing.. ? Generally appears to be 10cents cheaper paying with cash.


I did a little math to see how it compared to the rewards points I wold receive if I used the card.

gas: 20 gallons

cash: $2.90 = $58 tank
   -—2 gas ups a month saves $4 month * 12 = $48 saving a year

card: $3.00 = $60 tank
   -—credit card reward on gas: 2% so .02*60 = $1.2 savings per tank
   -— $58.40 tank
   -—2 gas ups a month saves $2.2 month * 12 = $26.4 rewards cash back a year

[HPstache]

Same with a lot of gas stations in NW Washington.  AMPM's are typically "cash only" to get the $0.10 lower price, Safeway's etc. are Cash OR Debit.

[Rosy]

Interesting - I have never noticed a savings for cash, hmm. Mr. R. likes to pay cash, because he does not want to expose his credit card or debit card to fraud at a gas station. He'd be happy to know that he made a bit of extra cash that way.

Part of his job includes working on those payment machines and he says every one of the older ones will put you at risk for sure and who knows when they find a way to hack the newest on the market.

[Dave1442397]

That's very common here in NJ, however, my 5% cash back on gas with my Pen Fed card more than makes up for the difference.

My usual gas station does not always have the cash discount, but they do this week.

[Cezil]

They do this in my neighborhood now.  Not sure why..  We'll be driving up north for the holiday weekend, I would like to remember to see if this trend is happening more places around the state, or it's a local thing.  Never noticed it growing up.

Edited because I forgot I'm 30.  When I grew up, credit cards weren't a huge thing.  Might just be the way the world is heading with this change.

[Clean Shaven]

I try to buy gas at Costco stations -- they're generally the cheapest (or close to it).

I like the Costco Citi Visa card too, which gives 4% cash back on gas purchases, whether bought at a Costco gas station or elsewhere.  So I'll always run my gas purchases through that card.

It all adds up...

[Canadian_Fire_tobe]

In Canada it's illegal to charge more for credit card transactions, so that doesn't happen here.

I do recall seeing this in North Dakota close to 15 years ago, so I don't think this is anything new.

[Davnasty]

I would assume the primary reason for this is that the discount the gas station gives you is slightly less than the credit card fee they would pay so they come out ahead.

But I can also speculate that because you need to go inside to pay in cash, the chance that you buy a drink or snack inside is greatly increased. I've heard (don't have data to back it up) that a lot of gas stations now make little to nothing on gas and make their profits on overpriced convenience items.

[johnny847]

In Canada it's illegal to charge more for credit card transactions, so that doesn't happen here.

I do recall seeing this in North Dakota close to 15 years ago, so I don't think this is anything new.

Are they allowed to charge less for cash?
I know that sounds stupid because it's the same damn thing, but we've had some recent rulings regarding this issue

[johnny847]

One of my friends lives in an area where they do this. But she buys gas gift cards at a discount from eBay (from the seller svm gift cards, which is actually the company that manages the gift cards for a bunch of companies including gas companies - meaning these are brand new gift cards, not used). They come on sale occasionally for 7 to 9% off.

And she still gets the cash price when using the gift card

[trashmanz]

In Canada it's illegal to charge more for credit card transactions, so that doesn't happen here.

I do recall seeing this in North Dakota close to 15 years ago, so I don't think this is anything new.

They can't technically do that here as well, but it isn't presented as "charging more for Credit card."  They get around it with a "cash only discount"

Also, despite the cash only discount, I've found that my CC rewards of 3% and 5% during special quarters neutralizes the cash discount so I don't bother with the hassle.  It shouldn't be hard to do better than 2% cash back.   

[trashmanz]

One of my friends lives in an area where they do this. But she buys gas gift cards at a discount from eBay (from the seller svm gift cards, which is actually the company that manages the gift cards for a bunch of companies including gas companies - meaning these are brand new gift cards, not used). They come on sale occasionally for 7 to 9% off.

And she still gets the cash price when using the gift card

The major brand stations near me are always more expensive than the no-name gas stations that don't have corporate gift cards, so that strategy would just be a pain for no gain (unless you just gotta go to the big name station).

[johnny847]

One of my friends lives in an area where they do this. But she buys gas gift cards at a discount from eBay (from the seller svm gift cards, which is actually the company that manages the gift cards for a bunch of companies including gas companies - meaning these are brand new gift cards, not used). They come on sale occasionally for 7 to 9% off.

And she still gets the cash price when using the gift card

The major brand stations near me are always more expensive than the no-name gas stations that don't have corporate gift cards, so that strategy would just be a pain for no gain (unless you just gotta go to the big name station).

My friend has found the major brand stations in her area to be more expensive at face value but cheaper in the end after factoring in the gift card and cash discounts. YMMV

[inline five]

I wouldn't think twice and just pay with CC. $20/yr savings isn't worth the hassle of carrying it.

[Valhalla]

One of my friends lives in an area where they do this. But she buys gas gift cards at a discount from eBay (from the seller svm gift cards, which is actually the company that manages the gift cards for a bunch of companies including gas companies - meaning these are brand new gift cards, not used). They come on sale occasionally for 7 to 9% off.

And she still gets the cash price when using the gift card

that's good to know. I buy mine from CostCo or Sam's... but good to have for travel.

[Frankies Girl]

Haven't seen that in SE Texas. And being as I'm in the middle of refinery country, I'm likely already seeing pretty much the cheapest gas prices in the nation as well.

I get a 10¢ - 30¢ discount using Kroger gas stations, and I use a rewards CC that gives me 5% back at gas stations. And I usually only fill up when the grocery is offering 2X the gas points anyway after shopping there.

[WhiteTrashCash]

I buy all my gasoline from a warehouse store which only takes credit cards. So I use whatever card offers the biggest cashback percentage for that month from 3-5%. It ends up being a decent savings.

[ND]

I will continue using cash until gas pumps start implementing chip & pin.

[Optimiser]

I use a rewards CC that gives me 5% back at gas stations.

Which card? I used to get 5% off gas with the Sallie Mae Barclay Card, but sadly that card is no more. I have a few cards that have 5% back on gas during some quarters, but none that are always 5% back on gas.

[ketchup]

I use a rewards CC that gives me 5% back at gas stations.

Which card? I used to get 5% off gas with the Sallie Mae Barclay Card, but sadly that card is no more. I have a few cards that have 5% back on gas during some quarters, but none that are always 5% back on gas.

I know the Costco Citi Visa will do 4%, and the Amex Blue Cash Preferred will do 3%.  I think there's a PenFed card that still does 5%.

[Proud Foot]

I haven't seen a cash vs credit difference for gasoline at any around me.  Many of the truck stops will have a difference on their diesel prices though.

I use a rewards CC that gives me 5% back at gas stations.

Which card? I used to get 5% off gas with the Sallie Mae Barclay Card, but sadly that card is no more. I have a few cards that have 5% back on gas during some quarters, but none that are always 5% back on gas.

I haven't seen this as a consistent thing for my cards.  The Discover card does have 5% gas as one of their quarterly rotating categories.  Always make sure to use that card for that quarter whenever I fill up!

[Nothlit]

Most gas stations require you to pre-pay if you're using cash, which is fine if you want exactly $40 (or whatever) of gas, but annoying if you want to fill the tank to whatever arbitrary amount it needs. Do you have to overpay and then go back inside for change at the end? I actually have no idea as I've never done it.

I basically don't use cash for anything except paying friends for incidental things or when a store's card reader isn't working, and I especially hate carrying around loose change. It ends up getting dumped in a pile at home until I have enough to make it worth taking to the coin counting machine at the local credit union (which, given the rate at which I spend cash, is about once every 5 years).

[HipGnosis]

Discounted price for paying cash is the vast norm in and around Milwaukee.
It started at 6 cents, but now it's considerably more.
The most annoying part is it varies greatly between stations and it can be a challenge to find the 'credit card' price.  Some stations display the cash reg., mid and premium prices, others display cash, credit and diesel, but not always in that order.  And never clear enough to read as you drive in traffic approaching.
I paid cash for a while when the discount got better than my 4% reward card, but I don't carry that much cash and sometimes I'd forget to re-stock my wallet.
Now I just use my reward card, or the Discover card when gas gets 5% back - I just have to keep a mental log of which stations use a low cash price as a teaser.

[Morning Glory]

I have not seen this in my area, although one gas station gives a discount for using their credit card (I think 2% on gas and 5% on grocery items). They also have a debit option with the same discounts.  We also have a grocery store that gives gas discounts as rewards for buying certain items.

My dentist gives a 5% discount if you pay with cash or check.

[Turnbull]

Most gas stations require you to pre-pay if you're using cash, which is fine if you want exactly $40 (or whatever) of gas, but annoying if you want to fill the tank to whatever arbitrary amount it needs. Do you have to overpay and then go back inside for change at the end? I actually have no idea as I've never done it.

This is the problem for me. I'm not going to take cash inside, wait in line for people to buy their lottery tickets, give the cashier a couple of twenties, go back outside, pump the gas, and then go back inside to wait in line again to get my change. I'd rather pay 4 cents more per gallon and not have to step foot inside the store.

[alsoknownasDean]

What about ATM fees to withdraw the cash in the first place?

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[CCCA]

I get the best of both worlds by buying gas at ARCO (which only takes debit cards) and is about 40-45cents cheaper than the Shell across the street, by buying ARCO gift cards at the local Safeway with a credit card.  That way I get the CC cash back and still pay the lower prices.

It's slightly less convenient because I have to track individual gift cards but I can save $4-5 filling up my Prius vs the Shell station.

[johnny847]

What about ATM fees to withdraw the cash in the first place?

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In the US there are plenty of online banks that will reimburse the ATM fees charged by other banks.
And the banks that don't do that at least don't charge fees for using their own ATMs. Don't banks in Australia at least do that?

[Johnez]

What about ATM fees to withdraw the cash in the first place?

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I withdraw cash at the grocery while doing groceries. Have visited an ATM less than a handful of times since I've had an account.

[OMark]

Although I'm a huge fan of earning credit card rewards, some discounts given for paying in cash at the pump or other places is hard to beat. I've worked out discounts with contractors and my car mechanic often takes of 5% or more if I pay in cash. It's a better deal than earning the 2-3% back from a card...and of course it's probably a better deal for him as well.

[HipGnosis]

This is the problem for me. I'm not going to take cash inside, wait in line for people to buy their lottery tickets, give the cashier a couple of twenties, go back outside, pump the gas, and then go back inside to wait in line again to get my change. I'd rather pay 4 cents more per gallon and not have to step foot inside the store.

Oh yes, good point.  But you forgot about having to wait for the person(s) that gets to the front of the line but won't stop talking on their phone long enough to tell the cashier what they're there for.

[chemistk]

Here in SC PA where I am, most gas stations don't do this. We also use the Blue Cash Preferred, so we get 6% back every time we fill up. 10 gallons at $2.40/gal means a $23.00 fill ir I go to one with the discount, or $22.56 with my rewards, so I'll take the rewards every time.

[slugline]

Haven't seen that in SE Texas. And being as I'm in the middle of refinery country, I'm likely already seeing pretty much the cheapest gas prices in the nation as well.

I get a 10¢ - 30¢ discount using Kroger gas stations, and I use a rewards CC that gives me 5% back at gas stations. And I usually only fill up when the grocery is offering 2X the gas points anyway after shopping there.

You'll see it in Houston. Not at the high-volume stations near the freeways or at the grocery/warehouse gas pumps. But if you find stations that are in the interior of neighborhoods, there's a good chance they will be setting different prices depending on your method of payment.

[neo von retorch]

Here in SC PA where I am, most gas stations don't do this. We also use the Blue Cash Preferred, so we get 6% back every time we fill up. 10 gallons at $2.40/gal means a $23.00 fill ir I go to one with the discount, or $22.56 with my rewards, so I'll take the rewards every time.

Can you check your statements and confirm you're getting 6% on gas stations? My BCP gives me 6% at grocery stores, but 3% at gas stations. (At $2.40/gallon, 3% is $0.072 discount.) Even the Giant (local grocer chain) Gas Stations give me 3%, not 6%.

[Just Joe]

This is the problem for me. I'm not going to take cash inside, wait in line for people to buy their lottery tickets, give the cashier a couple of twenties, go back outside, pump the gas, and then go back inside to wait in line again to get my change. I'd rather pay 4 cents more per gallon and not have to step foot inside the store.

Yeah - THAT! We already save alot of money carpooling and just not racking up alot of miles. Not going inside is worth it to me. I'll save that money somewhere else.

[Canadian_Fire_tobe]

In Canada it's illegal to charge more for credit card transactions, so that doesn't happen here.

I do recall seeing this in North Dakota close to 15 years ago, so I don't think this is anything new.

Are they allowed to charge less for cash?
I know that sounds stupid because it's the same damn thing, but we've had some recent rulings regarding this issue

Sorry for the late response.

No you can't legally offer a cash discount, you will find Chinese restaurants tend to do it anyways though, (I'm pretty confident that money doesn't make it into the till though :S). As you say it is basically the same thing. What you can do though is charge a Debit surcharge (usually 25 cents per transaction), you usually only see that at mom and pop stores though.

[Highbeam]

Call it what it is... a penalty for using a credit card. A punishment, fine, etc. It is not a discount for cash. The vendor has to pay the CC a fee for the transaction so they are charging you extra to make up for that.

Our local stations in Western WA actually advertise the cash price and then bump it up 10 cents when you run your CC. What amazes me is the amount of stupid people that don't even realize that they are paying this penalty.

[trashmanz]

Here in SC PA where I am, most gas stations don't do this. We also use the Blue Cash Preferred, so we get 6% back every time we fill up. 10 gallons at $2.40/gal means a $23.00 fill ir I go to one with the discount, or $22.56 with my rewards, so I'll take the rewards every time.

Never heard of Blue Cash Preferred with 6% gas, only on groceries.  Gas is typically just 3%.

[fuzzy math]

I get a 10¢ - 30¢ discount using Kroger gas stations, and I use a rewards CC that gives me 5% back at gas stations. And I usually only fill up when the grocery is offering 2X the gas points anyway after shopping there.

Most gas cash back rewards exclude gas bought at grocery stores... You are likely only getting 1% on them

[Enigma]

My USAA rewards AMEX card gives me 5% cash back which is a savings of 12.5-15 cents per gallon ($2.50-$3.00).

I couple that with using an app on my phone (Waze map program) and when I am on a route I can go to plot in a route to gas stations.  It then gives me the prices of all the gas stations on my route.  For locations that I travel often I have gotten to know the best stations that save me an extra 20 cents off per gallon.

Sometimes I see signs for 5 cents off per gallon and usually think it isn't worth it (5 cents on $2.5 ~ 2%).  It is usually on gas stations that are not the cheapest on my route anyway.  Seems more like an advertisement to bring in customers even if they are not actually saving against the competitor.

[FiftyIsTheNewTwenty]

What about ATM fees to withdraw the cash in the first place?

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I withdraw cash at the grocery while doing groceries. Have visited an ATM less than a handful of times since I've had an account.

Me too.  I resent the fee, even if my bank reimburses me.  I don't want them getting stuck with it!

CC fees are substantial, and why ARCO is able to charge less (by not taking them).  Do they still have machines to take cash at the pump?

ARCO would probably still be cheaper than a cashback-on-gas credit card.  Too bad they're only on the west coast.

Where I live, Costco is lowest priced, but matched by Walmart (Murphy), and some Circle-K.