It's not out of the realm of possibility that gas could rise to $7 a gallon within the next several years. I'm skeptical about that, but then, I didn't expect us to be at almost $4 a gallon right now, either.
Obviously, gas at that price will put many Americans in a financial pinch, unless they start planning now. Think three or four years down the road, and ask yourself how prepared you want to be for the possibility that gas will become more of a luxury.
What kind of car should you own? If you're in the market for a car now, consider what kind of fuel efficiency you might require in the future. It might make sense to purchase a hybrid or another vehicle that is more fuel efficient than the car you really want today.
How can you cut down on gas used for your commute to work? If you're shopping for a new house or apartment, consider whether it might make sense to find a place that's closer to work. If you think a job change is coming soon, keep the location of potential new jobs in mind when you're house hunting too.Can you reduce your gas consumption in your personal life? Think about where you shop for groceries, where you get your hair cut, where you like to shop, and where you like to socialize. Can you cut down on traveling to and from those activities? Could you find similar services closer to your house? Can you combine trips?
Is public transportation an option for you? In some cities, the public transportation isn't easy to use or desirable for many. But if you're in a city in which it would be feasible to use public transportation, start thinking about how you can work that into your life in the coming years to reduce your gas consumption.
Can you cut back in other areas of your life and save that money for a rainy day? I don't think anyone would argue with my opinion that as a whole, American consumers haven't been good at saving money. Look for areas in which you can cut back, even if it only offers a savings of $25 to $50 a week. That money can add up fast, and you may be thankful to have those emergency funds one day soon.
Let's face it, as a country, we've been spoiled by low gas prices for many years. There are plenty of people around the world who pay much more for gas than we do. The availability of cheap gas has made many of us somewhat irresponsible with our fuel consumption, and we may be forced to make changes in our life to accommodate rising prices. We can be more thrifty in our fuel consumption if we choose to do so. Now's the time to start planning for the possibility of even higher gas prices in the future.
Tracy L. Coenen, CPA, MBA, CFE performs fraud examinations and financial investigations for her company Sequence Inc. Forensic Accounting, and is the author of Essentials of Corporate Fraud.
Planning for $7 a gallon gas