Pay with GasBuddy

Some apps are nice to have. Others are necessary. GasBuddy Is one of those in the latter category.

GasBuddy tracks fuel prices at over 140,000 gas stations in the U.S., Canada, and Australia. Although it has a website, GasBuddy is best used as an app on the go. The app has been downloaded over 60 million times—and for good reason: nobody likes to overpay for gas. And it's especially fantastic for people renting cars.

Most rental car offices require you to fill up within a few miles of the airport, but if you come into the airport on the main road, you'll usually see inflated gas prices. A small detour of a few blocks can result in significant savings. With GasBuddy, it's easy to quickly find other options with much lower prices.

Image courtesy Yelp user Kortney G.

GasBuddy also has a history of innovating and quickly rolling out helpful features. For example, as Hurricane Irma prepared to make landfall last month in Florida, GasBuddy put out an update that let users report which stations were open so people were able to fill up and evacuate without spending precious time looking for gas. Once the storm passed, the app then tracked which stations had power and were operational. Certainly handy and even, in some cases, life-saving.

A Better Way To Pay?

GasBuddy just rolled out their newest service, Pay with GasBuddy. Their offer is simple: request a card, link it to your checking account, and receive 15 cents per gallon off your first fill-up and 5 cents per gallon after that. They advertise it as being simple to sign up and working at "every station nationwide."

Signing Up

The sign-up process for Pay with Gasbuddy is pretty straightforward, although it's not quite the "less than a minute" they advertise—they ask for your date of birth, bank account details, driver's license number, address, and phone number. (Have a checkbook or your routing and account number handy to speed up the process.) That's quite a bit of personal information, but given they're deducting funds from your bank account, we'll give them the benefit of the doubt to validate who you are.

Once you complete the process, they'll mail your card out, but there's still one thing to do before you can use it. They make two small "trial" deposits into your checking account. It takes 1-3 days for them to appear, and you'll have to verify those amounts on the Pay with Gasbuddy site before your card is activated. (That makes sure it's really your account you've given them.)

What's In It For Them?

Credit card transaction fees are a major expense for gas station owners. In some competitive markets, avoiding those fees can be the difference between breaking even and making a profit on the gas they sell. (That's why some stations have now started to charge a higher price for credit card transactions .) Pay with GasBuddy helps retailers avoid those transaction fees, which can run up to 4%. Presumably, Pay with GasBuddy charges retailers a lower transaction fee than the credit card processors and passes some of the savings on to users.

What's The Catch?

Free discounts are always good. And if you normally pay cash or use a debit card when filling up, this is certainly a better option.

But at today's national average gas price of $2.46, saving 5 cents per gallon is only a savings of just over 2%. Many credit cards offer better rewards on gas than that—up to 5% back, in some cases. (That's an effective savings of 12 cents per gallon.)

Here are some no-annual-fee credit cards worth looking into to help you save on gas:

  • Sam's Club MasterCard : 5% cashback on gas (up to $6,000 per year) with no annual fee (must be a Sam's Club member)
  • Costco Anywhere Visa : 4% cashback on gas (up to $7,000 per year) with no annual fee (must be a Costco member)
  • PenFed Ultimate Cash Rewards Visa Plus : 5% cashback with no annual fee (various easy-to-meet eligibility criteria)
  • Fort Knox Visa Platinum : 5% cashback with no annual fee (various easy-to-meet eligibility criteria)
  • Bank of America BankAmericard Cash Rewards : 3% cashback on gas (up to $2,500 per quarter) with no annual fee (up to 3.1% cashback in some cases)
  • Chase Freedom : Rotating quarterly bonus 5% cashback categories sometimes include gas (up to $1,500 per quarter) with no annual fee
  • Discover it : Rotating quarterly bonus 5% cashback categories sometimes include gas (up to $1,500 per quarter) with no annual fee
  • U.S. Bank Business Edge Cash Rewards World Elite MasterCard : business card with 3% cashback on gas with no annual fee

Due to annual fees, we wouldn't recommend getting the following cards specifically for gas rewards, but if you happen to already have any of them, these all have better rewards than Pay with GasBuddy can get you:

  • American Express Blue Cash Preferred : 3% cashback on gas (no limit) with a $95 annual fee
  • Citi ThankYou Premier : 3 points per dollar on gas, worth 3.75% when redeeming points towards some travel categories and potentially more if transferring points to some airline or hotel partners, with a $95 annual fee
  • U.S. Bank FlexPerks Visa Signature : 2 points per dollar on gas, worth up to 4% when redeemed towards airfare, with a $49 annual fee

It's also worth mentioning that their marketing video isn't quite accurate. They claim it works at "every station nationwide," but it's really more like 95%. While most major brands participate, it's worth noting that independent gas stations, as well as warehouse clubs and some grocery stores, won't accept it—especially since those places often have better prices than the major gas brands.

Also, the program is free now, but Pay with GasBuddy says they may charge an annual fee in the future. That would obviously significantly reduce the value of the program.

Final Verdict

If you tend to pay cash or use your debit card to pay for gas, or if you have a credit card that gives you less than 2% cashback (or equivalent) on gas purchases and don't have any interest in getting another credit card, then Pay with GasBuddy may help you save a bit on your fill-ups.

But with just a little bit of analysis on maximizing credit card rewards, you can easily do better than twice as good as Pay with GasBuddy can get you on everything after your first fill-up.

(Of course, if you're like us, you'll get the Pay with GasBuddy card and use it once, just to get that 15-cent-per-gallong discount. Yes, we're like that.)

But don't forget: even when you don't pay with it, GasBuddy can still help you find those cheap gas stations.

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