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By Herb Weisbaum
msnbc.com contributor
updated 8/28/2006 4:45:47 PM ET 2006-08-28T20:45:47

With record high gasoline prices, people are looking for ways to reduce the pain at the pump. One way to do that is to get a gas-rebate card; a credit card that gives you cash back every time you fill up.

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Curtis Arnold found an easy way to shave a few bucks off every fill-up. He uses a gas-rebate credit card that gives him 5 percent back on all gasoline purchases. So if the price on the pump is $3.00 a gallon, he’s really paying $2.85 a gallon, after the rebate, a savings of 15 cents a gallon! For the average driver, whose vehicle gets 20 – 25 mpg, the savings would be $100 or more a year.

Arnold, who founded the Web site Cardratings.com, says the interest in gas-rebate cards “has grown tremendously” in the last year or two. He predicts that as long as gas prices remain high, “the appeal of these cards is going to continue to grow.”

Not for everyone
Interest rates on rebate cards tend to be higher than they are on plain, no-frills credit cards.  That’s why Amanda Walker, Senior Editor at Consumer Reports, says it’s not a good idea to go for these cards “if you ever carry a balance, ever.”

Those higher interest charges “will eat up your rebate,” she says. Her advice: If you carry a balance, get a card with the lowest interest rate you can find.

On the other hand, if you never carry a balance, the interest rate doesn’t matter and you should consider a card that lets you earn something for the money you spend – cash back, airline miles, hotel stays, or shopping points.

“Whatever floats your boat that’s what you should go and get,” advises Bill Hardekopf, head of the Web site lowcards.com. “If you’re paying off your balance each and every month, you might as well not leave any money on the table in terms of these rewards,” he says.

Look for a card without a fee. Quite frankly, there’s no reason to pay an annual fee that will eat-up part of your rebate.

Beware of hype
Choosing a credit card is like making any other consumer purchase. You need to be skeptical of the advertising hype and find out what you’re really getting.

“Credit card companies can make just about anything sound good,” Hardekopf warns. Many of these rebate cards have “a lot of sizzle in their initial offer,” he says. But you won’t know the whole picture until you read all of the terms and conditions.

For example: the Marathon Platinum MasterCard from Chase offers a 10 percent rebate on purchases at Marathon gas stations, but only for the first 60 days. Then it drops back to 5 percent.

You need to find a rebate card that fits your lifestyle and spending habits.  Here’s a checklist of the major factors to consider when comparing cards:

Where can it be used?
Some cards are only good at a specific gas chain. For instance, the Hess Platinum Visa Card gives a rebate on all purchases at Hess stations. That’s great if there are Hess stations where you live. But what if you travel a lot? Are there Hess stations where you normally go? Remember: being locked into one brand discourages you from price shopping. Maybe that Chevron or Costco station down the street has a better price, even without a rebate.

Your best bet is to get a card that can be used anywhere. A lot of the newer gas cards give you that freedom, although they usually limit the full rebate to purchases made at a “stand-alone” gas station – where the retailer’s primary business is selling gas.  “Go to Wal-Mart and you’ll still get a rebate, explains Curtis Arnold of cardratings.com, “but you’ll get a 1 percent rebate not 5 percent.”

Many cards that offer gas rebates, also give you cash back for making other purchases. For instance, with the American Express Blue Cash card if you spend more than $6,500 a year you’ll earn 5 percent back on purchases at gas stations, supermarkets, and drug stores. Your rebate on all other purchases will be 1.5 percent.

Rebate limits
With some cards the rebates stop or dramatically drop after you charge a certain amount. The Discover Platinum Gas Card gives you 5 percent cash back on gas purchases up to $1,200 each year. After that, you can earn up to 1 percent on all other purchases.

That’s why you want to look for a card that has no limits (and there are some) or the highest limit you can find.

Expiration date
How long do you have to collect the rebate you earned? Some cards have no expiration date, but that’s not always the case.  The rebates on Citibank’s Shell MasterCard expire after 12 monthly billing cycles. The ExxonMobil MasterCard is even worse – rebates disappear after just 6 monthly billing cycles

Collecting your rebate
What sort of hoops do you have to jump through to get your money back? A few cards do it automatically, but in most cases you’ll have to request your reward.

The Chase PerfectCard Platinum MasterCard automatically credits your earnings to your monthly statement. With the BP Visa Rewards card from Chase, a gift card or check (your choice) will be sent to you whenever your rebate balance hits $25.

Whatever card you choose, you’ll need to be on the lookout for changes to the terms and conditions. Credit card companies can change their rules whenever they want. All they need to do is give you 15 days notice in writing. So that 5 percent rebate could drop to 2 percent and there’s nothing you can do about it, except change cards. That’s why it’s so important to read the notices you get from your credit card company. While most are advertisements, some are important.

In fact, the terms of two rebate programs are about to change. In October, Citibank cuts the rebate on gasoline purchased with its Citi Dividend MasterCard from 5 to 2 percent. American Express will pay single instead of double Membership Rewards points for gasoline and other "everday purchases.

You’ll find top rated gas rebate cards listed at lowcards.com.

© 2013 msnbc.com.  Reprints

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