Estimated read time: 1-2 minutes
This archived news story is available only for your personal, non-commercial use. Information in the story may be outdated or superseded by additional information. Reading or replaying the story in its archived form does not constitute a republication of the story.
SALT LAKE CITY (KSL News Services) -- Credit card companies are targeting consumers with the new sales pitch: “Save money on high gas prices,” but many people are finding they're paying more for their fuel in the long run.
American Credit Foundation Vice President Michael Peterson says credit cards offer rewards because the more you use your card, the more businesses have to pay to process the card. Peterson says most people don't pay off their card quickly enough to get the money back anyway.
“They’re making money on the front end and then also credit card companies make money on the backend because many of the credit cards clients do not pay their balances off in full,” says Peterson
He says unless you pay off your balance in full each month, you'll actually pay more. “You can take the low road and carry that balance on the account every month and pay more in interest than the gas that you bought was worth and that the reward is worth.”
Peterson says gas stations hate the new credit cards because they are charged two percent of the transaction to process the card and with higher gas prices those processing fees are cost the stations more. Some fuel centers are now offering better prices for customers who pay with cash.
(Copyright 2005 KSL NewsRadio)