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Rising Gas Prices Affecting Your Vacation Plans

Rising Gas Prices Affecting Your Vacation PlansRising Gas Prices Affecting Your Vacation Plans

For many of us we are thinking of our summer vacation coming up and wondering if high gas prices will have a negative impact on those plans. Gas prices have increased over 20% in the past few months and there are rumors that prices will go even higher. So how much will your vacation budget need to increase to handle the increase in prices for gasoline if you are going on a driving vacation?

Rising Gas Prices Affecting Your Vacation Plans – Impact on Your Vacation

Let’s assume you are going to drive a 1000 miles on your vacation. Half on the way to your destination and half on the way back. This represents a nice round number and may be short for some people and too long for others. Either way you can prorate the numbers to get a feel for your own cost. In order to understand the cost difference we have to make a number of additional assumptions. Each of these assumptions will be somewhat conservative and you may need to adjust them to match your own vehicle and the price of gasoline in your state.

  • Distance – 1000 miles
  • Gas Mileage – 25 m/g
  • Average Gas Price this summer – $3.90
  • Average Gas Price last summer – $2.70

Based on these assumptions a trip of 1000 miles is going to cost an incremental $48 this summer compared to last summer, which by itself is not a large amount. For many people $48 is not going to make a huge difference in their vacation costs if you are only driving a 1000 miles. If you travel much longer distances such as 3500 miles one way, the cost is going to be somewhere in the neighborhood of $340 which is a large amount and may cause some people to think twice about how far they go on their trip, especially if money is tight.

The Impact on Your Day to Day Travel

Many people commute to work every day in their cars. They do not have an option to take mass transit or prefer to take their own car. For these people, rising gas prices are having a profound impact on how much money they have to spend on getting too and from work. These price increases also take money away from many other household areas that cannot be dropped. The impact is usually on non essentials such as entertainment and vacation plans.

If you drive an average of 25000 miles a year the incremental cost of filling up your car is going to be $1200! This is a sizeable amount of money and hard for many families to deal with. The money must come from somewhere. This is a real problem for many families who often have two people. Both driving to work in opposite directions, so the real incremental cost can be twice as much.

A significant Issue

This is a significant issue for many families and as we discussed in an earlier post, “Exploding Gas prices”, this could have a profound long term impact on the economy and the long term health of the country. Of course other countries laugh at us in America as we try to deal with these high gas prices. In Canada, prices have been over $4.00 per gallon for some time and in Europe they are even higher. What is the big deal they say.

The experts would suggest that if the price increases are gradual and absorbed by the economy in small chunks, consumers and business will deal with these increases well. It is the shock of fast increases that are drastic that may shock the economy into a recession.

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One Response to “Rising Gas Prices Affecting Your Vacation Plans”

  1. life goes on and so do rising prices. we will probably have another round of inflation and that means gas is going to go higher which means everything else is going to go higher. so enjoy life now.

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