Filling up your gas tank has gotten a lot less painful in the last couple of weeks. In fact, gas prices have fallen to their lowest point in years.
For those of you who put on the miles in your vehicles, this means a significant savings. In our household, we’re spending about 1/2 of what we spent on gas for our vehicles just one year ago. We’re definitely feeling the impact. And it feels pretty good.
But we’ve been around long enough to know that these low gas prices won’t last forever. In fact, some experts estimate that gas prices will go back up to the $4 a gallon mark or even exceed it. Whether that happens in the next six months or the next two years is still up for debate.
So what can you do during this time of falling gas prices that will prepare you for the inevitable price hike down the road?
Continue to budget like you’re spending $4 a gallon on gas. You’ve already made significant adjustments to your budget to accommodate the high price of gas. Pretend like prices are still that high. It’s a lot easier to continue on the path you’re on then to struggle to find the money when prices do go up.
Watch out for lifestyle creep. It’s easy to let new expenses creep into your budget when you have extra money in your pocket. Don’t start driving more just because gas is cheaper. Don’t start adding more expenses to your budget because you have extra money. Don’t buy vehicles that get lousy gas mileage just because gas is cheap now. Keep doing all those smart, energy saving habits that save money on gas. Hold the line when it comes to spending the money you’re saving on gas.
Instead, put your savings on gas to good use. Use the extra money in your budget to pay down debt or build your emergency fund. Create a grocery stockpile of non-perishable goods. Contribute the extra money to a retirement account. Use the savings to strengthen your finances and it will help you weather the next price hike.
These tips may not be the fun response to the question of how to handle falling gas prices, but they are smart moves that will help you save money and prepare for whatever the future holds.