I know a couple people who will drive five miles out of their way, ten miles round trip, just to save a nickel per gallon. I’m sure you know several folks that might even drive further to save a nickel or dime per gallon.
I never worry about saving a few cents at the pump. When I need gasoline, I usually just pull in to the first gas station I see. That is because driving out of your way to save a few cents doesn’t make much sense. Usually, the savings at the pump are eaten up driving around to get the bargain.
Once again, I will use my trusty spreadsheet to illustrate my point. The results are shown in the two tables below:
For example, lets assume you drive 10 miles out of your way (round trip) to save four cents per gallon at a cheaper gas station. Let’s also assume you buy 12 gallons worth of gas. Looking at the top chart, we can see that you saved 48 cents.
Now let’s assume you paid $3.00 per gallon of gas. Looking at the bottom chart, which assumes the car averages 20 miles per gallon, we can see that you spent $1.50 driving to the station with the lower gas price. So in reality you lost $1.02 ($1.50 – 48 cents) in your quest to save four cents per gallon!
Your loss would be even greater if the price of gas was higher, or you drove even further to save the money, or your car got less than 20 mpg.
For this example, even if you only drove five miles round trip and the price of gas was only $2.50 per gallon, you’d still lose 15 cents (63 cents – 48 cents).
When shopping around for gasoline, you should naturally expect any savings at all to become less as:
1. The price of gasoline rises.
2. The amount of gas you put in your tank decreases.
3. The miles you drive to realize the “savings” increase.
4. The average vehicle MPG decreases.
So next time you’re driving around and your tank is running on empty, don’t fret about finding the cheapest price. Unless the competing gas stations are within a couple blocks of each other, the odds are you won’t be saving much money anyway.
More From Len Penzo dot COM:
- How Cheaper Gasoline Ultimately Costs You More
- It Could Be Worse: 9 Everyday Items More Expensive Than Gasoline
- Money Mirages: 6 Money-Saving Ideas That Are Anything But
Len Penzo blogs at lenpenzo.com, “the off-beat personal finance blog for responsible people”.