3 things in life are certain—death, taxes, and high gas prices.
Except I lied...only two of those are certain. WAIT, WHAT?!
Yep, that's right: there's a secret to getting gas so cheap it's practically free...and it's actually really easy! Our family saved thousands of dollars on fuel in 2017 and we want to show you how we did it.
Our latest fill-up in action
Let's get to the bottom line of how I make this possible. It starts with one magical place: Kroger!
Kroger is the nation's largest grocery store chain. Kroger-branded stores are mostly found in the Midwest and South, but there's a very good chance you have one of their other brands nearby:
- Baker's Supermarkets
- City Market
- Harris Teeter
- Jay C
- King Soopers
- Pay Less Super Markets
- Fred Meyer
- Lucky's Market
- Food 4 Less
- Foods Co.
- Ruler Foods
- Kwik Stop
- Loaf 'N Jug
- Smith's Express
- Tom Thumb Convenience Stores
- Turkey Hill
(list courtesy of Wikipedia)
The Secret Is Gift Cards
You've seen gift cards at the check out at grocery stores. They're usually for places you shop every day—Applebee's, Amazon, Staples, Macy's, etc.—but you probably ignore them. You also might know that Kroger has a rewards program that gives you "fuel points" for every dollar spent. Kroger typically awards 1 fuel point per dollar spent on groceries. However, Kroger awards 2 fuel points for gift card purchases and sometimes offers 4 fuel points for gift card purchases.
Redeeming Your Fuel Points for Epic Savings
Kroger fuel points can be redeemed for discounted gas at Kroger gas stations as well as Shell (in certain states). 100 fuel points gets you 10 cents off a gallon and it scales up linearly: 1000 points gets you $1 off a gallon. Although Kroger limits fuel point redemption to a maximum of $1 off per gallon, a few selected cities like Richmond, VA (where we reside—luckily!) have unlimited fuel point redemption. So if you have 2000 fuel points, you can redeem for $2 off a gallon and you are not limited to the $1 off per gallon cap. I redeemed 2400 fuel points on my most recent trip to Kroger for $2.40 off a gallon, which I captured in action in the video above.
But What Am I Going To Do With All These Gift Cards?
Purchase gift cards to places you shop anyway (like Amazon, Lowe's, eBay, etc.). Or do this strategically when you have a big purchase like several hundred dollars to spend on home improvement or holiday gifts. Kroger also offers 4X fuel points on Visa and Mastercard gift cards (up to $100 denomination) on selected weekends (make sure to digitally load the coupon). Visa and Mastercard gift cards are essentially cash, so you can use them for your everyday purchases.
Don't just fill up one car on your $2 off per gallon trip. Bring all of your family's cars! This is the trick to get maximum savings. You'll notice I got 35 gallons—when's the last time you heard of a car that holds 35 gallons? We filled up 2 cars.
Let's sweeten the pot even more by purchasing the gift cards from Kroger by using a credit card that earns bonus points or cash back on groceries. Here's a list of credit cards I recommend:
Discover it Credit Card: 5% cash back on $1500 in grocery purchases from April - Jun 2018
Chase Freedom Card: 5% cash back on $1500 in grocery purchases from April - Jun 2018
US Bank Cash+ Visa Signature Card: 5% cash back on your first $2,000 in combined eligible net purchases each quarter on two categories you choose
Blue Cash Preferred Card from American Express: 6% cash back at U.S. supermarkets (on up to $6,000 per year in purchases, then 1%)
City National Bank Crystal Visa Infinite Credit Card (CNB): 3% Rewards (unlimited). This is my go-to card on a daily basis after I have maximized bonus earnings on any credit card like Discover it or Chase Freedom.
Quick Back-of-the-Hand Math:
Let's crunch the numbers on $500 of gift card purchases from Kroger when 4X fuel points are offered:
Gift card purchase amount: $500
Cash back earned (using a 5% Credit card): $25
Kroger fuel points earned: 2000 (assuming 4X weekend specials)
Gas savings: $2 off a gallon (selected cities) when redeeming 2000 fuel points in one go
I Made a Profit. At The Gas Station.
I filled up 35 gallons of gas for $1.36 as shown in the picture at the top of this post by redeeming 2400 fuel points. I actually earned a net profit because I used CNB Crystal Visa Infinite card that earned $15 (3%) cash back on a $500 Amazon gift card purchase.
Net profit: $15 (cash back rewards from gift card purchase) - $1.36 (cost to purchase 35 gallons of gas) = $13.64 profit
I am actually getting paid each time I fill up gas. I don't think even the King of Saudi Arabia can beat this gas deal!!
We have two cars in the family and both my wife and I easily need three tanks of gas each month. Assuming a gas price of $2 per gallon (conservative), this is what we would otherwise spend on gas without any savings -
Total gas needed between two cars each month: 100 gallons
Cost without any savings (assuming $2/gallon): $200 per month
Cost to fill up gas annually (without fuel points): $2400
We are not only saving thousands in gas each year but, by strategically using credit cards and paying them off in full each month, also earning a ton of cash back that helps pay us other bills or travel the world for cheap.
What if your city doesn't have a Kroger? There are lot of other ways to earn fuel points via different reward programs to stack opportunities. Check your local grocery store to see if they run a similar program. You could also sign up for programs like Plenti, where you can earn Plenti points with partners such as Rite-Aid and Macy's and redeem those points for discounted gas at Exxon gas stations.
Amit Desai runs an awesome Facebook group called Credit Card 101. You should click here to join it and learn tons of tips like this and more!