There’s an ARCO gas station right by my office that has the lowest advertised prices in the area. It’s always at least 2-3 cents cheaper than the next best place and a solid 7-9 cents lower than what I can find close to home.
The funny thing is that even with the great price, the ARCO station is not my first choice when I fill up at.
It starts with the 45 cent charge for using a debit card. That sucks and adds another 3-4 cents per gallon each time I fill up.
So why not just pay in cash and get the best rate? Because remembering to take cash out of the ATM each week just to have a bunch of change in my car does not appeal to me!
Even when paying with cash, I still think the smart move is to avoid the station.Â I’ll use an example to show you why:
At the ARCO station, gas is $3.69 (and 9/10ths of a cent, everyone seems to forget that that means the price is much closer to $3.70 than $3.69) while the 76 station 3 blocks away sells gas for $3.71 (and 9/10ths).
Paying with cash for 12 gallons at the ARCO station costs $44.39 while the debit transaction at the station costs $44.84, a true rate of $3.736, so about 3.5 cents more per gallon.
At the 76 station, 12 gallons cost $44.63, which is better than the cost of using a debit card to pay at the ARCO station.
But there’s one more advantages to going with the 76 station: you can use your credit card, which for me means 1% rewards (and maybe more for you!).
When factoring in the rebate I’ll get, the price drops to $44.18 for a true price of $3.68, even cheaper than the cash price at ARCO!
There are two lessons to be learned here:
1. We’re talking about very small amounts of money. It’s about 15 cents, so maybe a dollar a month at most. Not really a budget buster in my book. Don’t sweat it, choose the station that’s most convenient.
2. Be aware that things aren’t always the way they seem. Sure, cheap gas is great, but guess what? Advertisements aren’t always so cut and dry. The “cheapest” gas wasn’t really so, and when you add in the hassle, it’s actually a much worse deal!
Readers, do you always go with the cheapest option for gas? Would you pay in cash to save 20 cents or is the hassle not worth the savings?