Gas Stations: Cash Discount or Cash Back Credit Card?

Personally, I think it's a pain to pay cash at a gas station. I don't like trying to predict how much I'm going to spend on gas and either not being able to fill my tank all the way or having to go back in and get change. A gas station isn't exactly the type of place I want to to extend my visit.

If you live somewhere that has a gas station chain that has one price for paying cash and another, higher price for paying with a debit card or credit card, you might have wondered whether it's worth it to get the small cash discount, especially if you have a cash back credit card. Here's an easy chart to help answer your question. Which payment method will allow you to come out ahead depends on the price of gas, the percentage cash back your credit card gives you on gas purchases, and the discount the gas station gives you for paying cash.

Actual Gas Price at $3.10/gal. with Cash Back Credit Card
1% back - $3.07
2% back - $3.04
3% back - $3.01
4% back - $2.98
5% back - $2.95
6% back - $2.91

Of course, this still doesn't account for the hassle and extra time involved in paying cash.

Photo by ^riza^

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