Subaru Credit Card Has One Major Downside

Subaru MasterCardMy mom recently bought 2012 Impreza Sport. It was shocking just how hard this vehicle was to locate. Even though it was the last model year, within a 100 mile radius of her zip code there were only around a dozen 2012’s and 2013’s in-stock. Out of those, only around 3-5 were the “sport” versions (they have rooftop rails, which she needs for kayaking).

With such limited supply, I guess it comes as no surprise that the local Subaru dealer tried to rip off my mom by charging not a penny less than MSRP. Fortunately, I was able to help her knock a bit off the price, but it was nothing compared to the 7% discount below MSRP I negotiated for her on an Outback.

Conclusion? Depending on the year and model, getting a good price on a new vehicle may not always be possible. Which is all the more reason to apply for a Subaru MasterCard, but make sure you review and remember the potential downside that comes with it.

Excellent rewards (most of the time)

When it comes to return on spending, the Chase Subaru credit card offers one of the absolute best deals:

3% in Subaru Reward Dollars: This is basically like earning 3% cash back on everything, because with every purchase you receive 3% back in the form of “Reward Dollars” which can be redeemed at any participating Subaru dealer in the US, excluding Hawaii.

For example, if you made $10,000 in purchases, you will receive back a $300 certificate to spend at the dealer. This credit can be applied towards almost anything there: new and used vehicles, parts, service, and leases.

But now for the downside…

If you read the credit card application you will see that they cap the number dollar Reward Dollars that can be earned per year at 500. After that, your spending earns nothing!

If you do the math, you will see that $16,666 is the cut-off point:

$16,666 X 0.03 = 500

This means that the Subaru MasterCard from Chase is arguably one of the best choices for annual spending below that amount. But after that, it’s one of the worst credit cards since no additional rewards will be earned.

What this means for you in 2013

If you are an owner of one of their vehicles, then the Subaru card definitely makes a lot of sense since there’s no annual fee. But you will want to keep tabs on your spending and switch to a different credit card after you hit that threshold each year.

$1,666/year may seem like a lot, but remember that’s only an average of $1,389/month so if you pay for everything with plastic (like me) then you may max out their rewards program rather quickly.

After maxing out, a good alternative to the Subaru credit card is one of these which give 2% rewards on everything. Meanwhile for special categories of spending like gas and groceries, you will still want to use other cards, such as this one that gives 3% and 6% cash back on the aforementioned categories.

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Chase sent me a letter saying that the cards benefits with Subaru will end September 30, 2014. Is it being picked up by another bank?

another downside is that you can only use rewards on your vehicle, I tried to use on my nephews subarus and the dealer wouldn’t take the coupons.

I was unsure when my benefit year began and ended since it has been a moving target for some reason. I called and asked because I was going make a major purchase and I was told my benefit year had just begun, so no worries. I was later told I had exceeded my benefits. I lost $300 because someone either lied or was incompetent. I have since cancelled this card.