Here’s an Intriguing idea: What if you could buy gasoline tomorrow, at today’s prices? Would you do it?
It’s basically a gamble that gas prices will be higher in the near future than they are today, but I’m not sure that’s much of a gamble in the current environment.
That’s what MyGallons.com is offering, but is it worth it?
How MyGallons Works.
You sign up for a MyGallons account and provide your credit card information. This is required to purchase, among other things (more on this later), your gallons of gas at today’s price.
After you’ve got a membership account, you are free to buy your gallons. You specify your home area, presumably a zip code, and they calculate the average price of regular (87 octane) gasoline for your area. That then becomes your “MyGallons Price.” This is the price at which you purchase your gallons. It’s updated constantly, so you don’t really get a discount at the time you purchase the gas, but you do if gas goes up in price between the time you purchased your gallons and the time you purchase the gas at the pump.
For example, let’s say that the price of gas in your home area today is an average $4.19 per gallon. You buy x gallons at $4.19 today. Now fast forward a few weeks and gas is now averaging $4.69 a gallon. You use your MyGallons card and pay only $4.19 a gallon, thus saving you $.50 per gallon.
Sounds great. It gets even better.
The MyGallons Card itself is really just a debit card so you can pay at the pump just like your credit card or debit card today.
When you run low, less than 15 gallons left on your card, MyGallons will automatically pre-purchase more fuel for you and bill directly to your credit card. If you don’t sign on for the auto refill feature, you can get notified when your balance runs low via email and/or text message. Sounds pretty cool, but there may be a 72 hour delay.
You can also get up to 3 cards per account, which is nice for families.
“Sounds great,” you say? “Where do I sign up?” Whoa… hold on there cowboy… now for the other side of the arrangement.
The Catch.
OK, so MyGallons offers a great way to provide a sort of pricing insurance against the meteoric rise of gas prices. But you have to ask yourself, how do they do it? How do they stay in business.
Well, for one thing they could make out on the deal if gas prices fell sharply after you purchased your gallons. This would be like you buying high, and being left holding the bag.
But chances are that the price of gasoline is not going to go into a spiraling decline any time soon, so what’s in it for them?
Remember above, when I said your credit card was:
“required to purchase, among other things (more on this later) your gallons of gas at today’s price”
Well those “other things” are fees.
The Fees.
- There’s the annual membership fee, of course! That runs $29.95 with auto-refill program; $39.95 without.
- There’s the $15 overdraft fee if you use more gas filling your tank than you had on your MyGallons card. (If you sign up for the auto-prepay, you avoid the overdraft.)
- If you choose to sign up for the auto-prepay feature (to avoid the overdraft fee), then you pay a “small” $1.95 fee every time you reload your MyGallons Card.
Is It Worth It?
You’ll have to do the math and decide for yourself, but I don’t think it is. In my example above, you’d save 50 cents per gallon. At that rate you have to have to buy an additional 60 gallons of gas in a year to break even on the membership fee.
Despite how it feels, gasoline doesn’t go up fast enough for that to work to your advantage. As it stands now the national average for regular gas has only gone up $1 since this time last year.
Having said that, I suppose if you stock piled your MyGallons card (I wasn’t able to find any limit to the amount you could purchase), and have to fill up a large tank of gas frequently enough it may work out in your advantage, but minimally.
In short, I think it sounds great and plays on the psychological effect of “sky-high gas prices”, but it’s not worth it for the average driver.
Photo by elvis santana
Technorati Tags: Gas prices, MyGallons, Saving money, Scam
Popular Posts