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At least once or twice over the past couple of months most of us have complained about the increase of the price of gasoline. But, is this nothing more than just making conversation, or are we really being hurt financially?
Like most issues, the answer depends on who you ask.
According to a recent poll on Daily Fuel Economy Tip, over 55% of us are paying less than $50 extra per month to gas up our cars when compared to what we had to pay this past winter.
While I’m not in any position to scrutinize anyone’s personal finances, it seems that for most people this is pretty much a nominal expense and could be easily mitigated by slightly cutting back on other activities or purchases.
When asked, “How much more per month are you spending on gasoline compared to this past winter?” 33% of respondents stated they are paying between $26 and $50 extra; 25% are paying less than $25 extra; 22% are paying in excess of $100 extra; 12% are paying between $76 and $100 extra; and 8% are paying between $51 and $75 extra.
Don’t get me wrong, I love saving money as much as anyone, but for as much as most of us have complained about the increase in gas prices, these overall monthly numbers seem pretty tame. If you go out to dinner one less time or take it easy at happy hour, chances are you wouldn’t even notice a difference in your personal finances.
Don’t forget, you can also reduce the amount of money you pay by simply driving less or getting more out of your car’s fuel economy.
So, in the grand scheme of things, while rising gas prices are a bit of a nuisance, they’re probably affecting your personal finances much less than you think.
{ 9 comments… read them below or add one }
Excellent point, but I would just interject two quick points:
First, for a large number of people. $50/month IS a squeeze on the family finances (for instance, if you were struggling along on $15,000 a year, that additional $600 a year is 4% of your annual income). Every penny really does count when you’re hovering along the poverty line.
Second, there are the “hidden” costs. Food, consumer goods….prices are crawling upward and “great sales” are harder to find, because transport costs are increasing. The desire for ethanol has pushed up the price of corn, which has increased the price of corn syrup and fillers that form the cornerstone of the cheap-food economy, the feed that goes to animals for meat and milk, etc. So that $50 a month in gas may be joined by another $50 a week ($200 a month) in food and goods.
It adds up pretty quickly…
It’s not just the price of gas…..it’s also the price that gets added to the food we eat because that higher cost gets passed onto other things that we buy. It’s Economics Dummy.
You both bring up good points, and it’s my fault that they have to be brought up in the first place. I was trying to address just the direct cost associated with the increase in gas prices, not the secondary increases.
I agree and I disagree. I agree it’s easy enough to make up the difference elsewhere; the majority of us spend more on discretionary nice-to-haves than we do on gas. The difference is that those discretionary things are choices, where gas isn’t much of a choice. Public transportation is an option for some but not all. When that isn’t an option, you’re just contributing to billion-dollar companies’ bottom line without getting any tangible benefit for yourself.
Where I disagree is the idea that $25-$50 a week isn’t a lot of money. Those nickels and dimes do add up. Paying just $10 extra per month on my mortgage will pay my house off a full month early. So if I had that $100-$200 per month extra that I’m paying on gas back, I could own my house outright a couple of years early.
The more debt you have (credit cards, student loans, car loans, home mortgage, home equity loan), the more you need that extra $100-$200.
On the other hand, the longer gas prices stay high, the more incentive we have to take a long hard look at alternative fuels, so ultimately some good could come of this.
so, i should just cut back on my livelyhood so the gas barons can get more absurdly rich than they already are? they are nothing more than crooks. they will all burn in hell by flames fueled by their own oil. you are probably one of them. this country should get together and ban entire oil companies for a month or more at a time, but most people are too stupid!
It’s not that we’re too stupid, it’s that our lives are too dependent on oil. You mean to tell me that over a one month span you could go without driving your car, in many cases heating your home and water, using any plastic products, etc.? I highly doubt it.
It doesn’t effect me very much, since my wife and I only live about 1 mile from work and drive together when possible. I probably spend an additional $15-$20 per month when prices get this high.
I’ve also noticed that the price of groceries has increased slightly over the past few weeks, due to higher shipping costs and the price of corn.
What I do worry about is my brother and father, who are farmers. While a jump in fuel prices doesn’t effect me very much, it’s a HUGE expense for them. Even though the price of corn has risen, when it costs 30% more to operate farm machinery and irrigation pumps/pivots, that eats away any profit they would have made from the inflated corn prices.
Think about this: in Romania, gas/diesel is about $5.5 / gallon ($1.44/liter). the medium wage is $5-600/month! And yet, there are more and more cars on the road (true, a lot of them are company owned cars, but still…) but a lot of them are small, compact diesels who get 40-50 mpg. It really wasn’t necessary for me to own a car there, and that’s just because public transportation is a really really good alternative there.
Lets me bring it to a simple point. Prices go up while our pay stays almost the same. Figure the math.