PenFed Cash Back Gas Credit Card Review

Picture of Item Reviewed

Editor's Rating:
Intro Purchase APR Regular APR Intro Balance Transfer Annual Fee Credit Needed
N.A. Life of Transfer $0 Excellent
  • Earn 5% rebates on gasoline spending
  • No foreign transaction fee
  • Great intro APR and Balance Transfer deal
  • Earn only 0.25% rebates on airline and boat fuel as well as other regular purchases
Executive Summary - This card gets a 4-star rating because it is the only remaining card in the market that gives 5% cash back on gasoline spending (though rebates on other purchases is not impressive). Also has a great intro APR offer and a balance transfer for life offer at the moment. To apply for this card, you need to be a Penfed member. If not, you have to pay a one time membership fee to join either the National Military Family Association ($20 one time fee), or the Voices for America's Troop, (one time $15 fee). Excellent credit is required and proof of W2 may be required as well.

Best for Earning Gas Rebates - The PenFed Platinum Cash Back Credit Card is perhaps the best cash back card to earn gas rebates because this is the only card today that pays 5% rebates on gasoline purchases all year round. Right now, they also have a great low introductory rate offer and a balance transfer of life offer (see details below). But the ability to earn 5% cash back on gas comes at a price (as we'll discover soon) The only thing is that you have to be a PenFed member. And if you are not, then you need to join one of their associations of a one time $15 before you can apply for the card. (hint: we will show you how to do this at the end of the review).

Earn 5% rebates on gas, but what about other purchases? - With this card, you earn 5% rebates on gasoline expenses. And I'll repeat again - this is only card we know today that pays you back 5% on gasoline. All gas-station cards no longer pay you on percentage of gasoline spending but rather on just discounts per gallon. And the good cash back cards have cut back the rebates they pay on gas to 2% or 3%. But the having the ability to earn 5% on gas comes at a price. Right now, you can earn only 0.25% cash back for all other purchases (and that includes air and boat fuel). Previously, they paid you 2% cash back on groceries (ended in February 2011) and 1% cash back on everything else. You can also earn unlimited rebates (whereas they had capped it at $50,000 in annual spending before).

Who can get this card? - Because this card is issued by PenFed, you need to jump through a couple of hoops to get this card. Essentially, you have to be a member of the PenFed Credit Union. Here is how you could be a member2.

  • United States Military & Uniformed Services
  • Member of an Eligible Association, Military Officers Association of America (MOAA), or the Reserve Officers Association (ROA)
  • United States Government Employees
  • Family Member or Housemate of a member
  • Employee of an Eligible Place of Business - like Andersen Air Force Base, DCVA Medical Center - Contractors, Walter Reed Army Medical Center
  • American Red Cross

If you do not qualify as a member with the above criteria, you can still become a member by joining the National Military Family Association (NMFA) for a one time fee of $20 (and you do not even have to keep this membership once you are a member of PenFed!) or the Voices for America's Troops (which has a one time $15 fee).

For full details, check this page.

PenFed Gas/Cash Back Card - Beats It's Peers In Gas Rebates - The standout feature of this card is the ability to earn rebates on gas at 5%. Back a few years ago before the financial crisis, most gas station credit cards paid 4% to 5% cash back on their cards. Even cards like the old Citi Dividend Card paid 5% cash back on gasoline. But since the financial crisis, most gas station credit cards reward their cardholders for gasoline purchases not by percentage of spending, but by discounts per gallon. So for example, you might get a gas credit card that paid you 15 cents per gallon spent on the card. BP was the last to hold out, but even they have recently changed to a discount by the gallon system.

In terms of cash back cards, the days of a cash back credit card having 5% payout for gas are over. The old Citi Dividend Card and Chase Cash Plus Rewards used to pay 5% rebates on gasoline purchases. The old Amex Blue Cash also paid 5% on gasoline spending after crossing $6,500 in annual spending, but now only pay 2%. Discover OpenRoad card used to also pay 5% rebates on gasoline but has cut back to 2%. But these cards are no longer issued with this rebate formula. The only other cards that come close are the Chase Freedom and the Discover More Card. For 2012, they are offering their cardholders the opportunities to earn 5% on gasoline spending for the first and third quarter.

Low Intro APR and Balance Transfer for life deal - In January 2012, Penfed issued a press release which highlighted great introductory low rates they were giving for all their cards1. They applied a 9.99% APR from 15 January 2012 until 30 June 2014. From 1st April 2012 to 30th June 2012, there is a promotional 4.99% balance transfer rate for the life of the balance transfer.

Penfed - The Best Gas Card Today? - In my opinion, this card is probably the best gas credit card to get today if you are looking to save money on your gasoline purchases. That is because there is no card today that gives you 5% rebates on gasoline purchases. The real problem I see is that for any other purchases, you only earn 0.25%, which is really bad. That being the case, I would suggest combining this card with another cash back credit card.

For those looking for a good balance transfer for life deal or a low interest rate, then (as mentioned earlier) you would probably want to consider this card as well. All Penfed cards also do not charge any foreign transaction fees. So for those who travel abroad, this card might be another consideration. Because of the low interest rate they are offering, you probably need excellent credit and Penfed has been known to request for W2s. Hence, the approval process may take a little longer.

If you are not a PenFed member, then you do have to apply to be a member. This will cost you $15, which is a one time fee. Below is a detailed instructions of how to apply for this card and how to apply to be a Penfed member.

How To Apply For This Card And A PenFed Membership - First thing you have to do is to click on this link here. This will take you to the following page.

pen fed application page 1

On this page, it list two cards. This card is the second one. You have to click on the apply button (shown in the red arrow).

penfed application page 2

If you are already a member, then you just have to log into your account. If not, then click the "join now" button on the right and it should take you to this page. penfed application page 3

It ask you whether you are eligible and part of any of their organization. If you are not eligible, there is a choice at the bottom that says "none of the above". Click on that and continue. It will take you to the next page. penfed application 4

On this page, you are given a choice of whether to sign up for the National Military Family Association (which has a $20 one time fee), or the Voices for America's Troop, which has a one time $15 fee.

One you have signed up, you can proceed to apply for this card.

1. Press Release: Penfed Rewards Card Now Feature New Lower Variable 9.99% purchase APR
2. Eligibility Criteria to be a Penfed Member