Significant Changes in Response to Higher Gas Prices

Change to a Smaller Car Because of Gas Prices

What will you do when gas hits $5?

I’ve seen several $5 a gallon gas price predictions for 2012.

That wouldn’t surprise me, given where we are now: $3.75 a gallon on March 12.

According to a recent Gallup poll, at a $5.30 a gallon gas price, most Americans would be forced to make “significant” changes to the way they live their lives and spend money.

$5.30 was just the median (i.e. the tipping point). At $4, over 30% of those who responded would start making significant changes.

This got me to thinking about what significant changes I’d be willing to make and what others might do. Not simple measures to cut fuel costs, but big things you can do to reduce your dependence on gas.

Make Your World Small

The first thing that comes to mind is changing jobs or moving. If you have a long commute to work each day, consider the impact of getting a job closer to your home, or moving to a home closer to your work. Everything else being equal, this could really save money.

For example, if you currently use 40 gallons of gas a week on your commute and you reduce that to 10 gallons a week, you could save as much as $500 a month (with gas prices at $4).

Of course, “everything else being equal” is not a reality for most people. Changing jobs and moving are two of the most stressful, life-changing things you can do. Most of us live and work where we do because we’ve previously made that choice.

All I’m saying here is give this idea some thought and see if it’s possible for you. I like the idea of keeping my world small primarily because it makes me happier. Traffic and rush hour driving make me a crazy-person. I have taken pay cuts in the past to work closer to home.

Make Your Vehicle Small

If you can’t make your commute shorter, it’s time to consider a different vehicle. By “vehicle” I mean several things: you could car pool with others, take public transportation, get a motorcycle, or get a “new to you” car that’s more fuel-efficient.

Again, make sure that you’re not spending a lot of money to save a little here, especially with the idea of a new fuel-efficient car.

What kind of “significant” changes do you see yourself making if gas prices hit $5.30 a gallon?

According to the same poll, most people want Government action to help lower the price of gas in the U.S. Do you think that will happen?

Image by OctopusHat

Last Edited: March 12, 2012 @ 3:59 pmThe content of ptmoney.com is for general information purposes only and does not constitute professional advice. Visitors to ptmoney.com should not act upon the content or information without first seeking appropriate professional advice. In accordance with the latest FTC guidelines, we declare that we have a financial relationship with every company mentioned on this site.
About Philip Taylor

Philip Taylor, aka "PT", is a CPA, financial writer, FinCon CEO, and husband and father of three. He created PT Money back in 2007 to share his thoughts on money and to meet others passionate about managing their finances. All the content on this blog is original, and created or edited by PT. Read more about Philip Taylor, and be sure to connect with him on Twitter, Facebook, or view the Philip Taylor+ Google profile.

Comments

  1. My cars are old (17 & 15 y.o.) and somewhat economical.  Despite that, I plan on buying even more gas efficient  cars in the next year or so.

  2. Chris Tucker says:

    Gas is cheap — just look at what people drive … SUVs and pickups all over the road.

  3. We are fortunate that we work at home. I hate that the food costs will go up.

  4. Andrew White says:

    Not owning a car even harder than I do now.

  5. Squeezer @Personal Finance Success says:

    I think it is a bad idea to sell your car and buy/finance another car to get 5 more mpg.  yes you may save $500/year in gas but will pay way more then that in financing interest.

    • correct, not to mention depreciation costs… and insurance. Ideally you want to drive your car until it dies or time/cost of maintenance exceeds what you can tolerate.

  6. Stuff About Money says:

    I work from home. Gas could be $10 and it wouldn’t directly impact me. My wife commutes but she has a small car that gets good mileage. Like Car La points out, I’m more concerned about indirect impact like it has on food prices.

  7. Hey PT. We’re thinking about going down to one car to cut down on insurance – and we’ll save gas in the process as well (we’ll make smarter, shorter trips). Since I’m working from home now, why have two cars, right? We’re doing our best to make our world smaller! 😀

  8. JeffreyCrews says:

    I think you will begin to see a lot of people working from home. I saw in a study how much people save by working from home. If someone is currently using 40 gallons a week, then that is a total of $200/week ($5/gallon) and $800/month. Now over a year that is pretty significant. Working remotely could be a huge option with companies.