The high cost of gas is a problem affecting everyone in the United States. The impact of rising gas prices on the American consumer has informed travel, work, and leisure plans. The issue is not just the high cost of gas, but the increasing cost of living. Inflation, or the rise of costs of goods and services, means that the cost of food, clothing, and shelter have all increased, while wages have remained the same. How are you handling the increase of gas costs in your family budget?
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What are the current gas prices that impact the American consumer?
According to the Energy Department, Americans increased their gasoline consumption by 508,000 barrels a day last week from the week before. (Source: https://www.nytimes.com/2022/08/15/business/energy-environment/oil-prices.html)
It’s still summer and families are taking last-minute road trips for their vacations before kids go back to school. Even if they did start school in early-mid August, the weather is still great for traveling with Labor Day being one of the biggest holiday weekends. In most parts of the northern hemisphere, the weather continues to be nice through October (or all year round, like it is in California, Florida, and Hawaii).
Gift a Gas Gift Card to Someone You Love
If you need to purchase a gift for a college student, driving teenager, or recent graduate, consider buying them a Visa gift card off Amazon for them to use for gas purchases. They will thank you!
How have gas prices changed over time?
If we roll the clocks back twenty years to 2012, we will notice that gas was much more affordable. Gas was on average $3.64 per gallon in 2012. Today, the average U.S. gas price is $4.08 per gallon. If we go back even further to 1994, gas hovered around $1.00 per gallon. (Source: https://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=pet&s=emm_epm0_pte_nus_dpg&f=m)
Families today must budget more for gas in their monthly budget and cut from other line items. But how are families doing this? With food costs and other costs rising exponentially, perhaps families are taking extra jobs to earn side income for gas money.
How do high gas prices affect the economy?
When the cost of gas increases, manufacturers must raise the cost of goods to cover the increase in expenses. Gas price increases cause the cost of transportation, shipping, electricity, and air travel just to name a few. So, when gas prices increase, it means the cost of food at the grocery increases, the cost of services everywhere increases, and really, it sets off inflation like a gun going off at a marathon.
What can be done to reduce the impact of high gas prices?
There are many things that can be done to reduce the impact of high gas prices. Driving less overall is perhaps the only true way to combat the high prices. From ridesharing to taking public transportation, to working from home. there are easy ways to trim the gas budget.
Here are 9 helpful solutions to trim your gas spending:
- Carpool or rideshare to work
- Trade in or sell gas guzzlers for a hybrid or electric vehicle (we love our Toyota Prius and RAV4 Hybrid)
- Work from home instead of driving to work
- Walk and bike more (or buy an electric bike or scooter)
- Use public transportation
- Batch errands to save fuel
- Reschedule or cancel road trips and take a staycation instead
- Use GasBuddy or the Citi Costco Visa to get top rewards
- Drive slower and use electronic gauges to watch fuel consumption
What’s next for gas consumers?
California recently passed legislation to have the whole state convert to electric or hydrogen cars by 2035. The measure also stipulates that 35% of vehicles sold in California must be hydrogen-powered or electric by 2026, just a few years from now.
Considering the chip shortages, overall vehicle shortages, high costs of delivery fees, and dealer fees, this seems like a bit of a stretch. However, California has a history of setting the trends for the rest of the automotive industry. We shall see.
As you consider your next car, take consideration of gas mileage, maintenance costs, and other costs involved in car ownership. More and more people are opting to get electric scooters, having their groceries delivered, and cut overall travel, which are great ways to cope.