Archive for June, 2008

Price-per-Gallon Versus Dollars-per-Pound

11 June, 2008

I’ve been thinking about the fact that I haven’t been writing a lot lately.  I have a reminder note to post something each week, but each time it came to writing, the little bit I’d put together was followed by ‘close document’ and when asked ’save file?’ the answer was ‘no’.

Today I was thinking about gas prices.  I’m of the opinion that gas prices aren’t necessarily “high” these days, they were just extraordinarily “low” before.  We buy gas by the gallon, but I’m a big advocate of thinking of it as “cents per mile”, as in what does it cost you to travel a certain distance?  And if gas prices go up 10, 20, or 50 cents, what was the change in the cost of a trip?  In my case, I’m at about 20 cents a mile right now.  That means I spend under $6.50 round-trip to work these days.  I make considerably more than that during the day’s work, so making the trip is worthwhile.  If I took a bus it would cost me about $4 and take twice as long, so the paying the extra $2.50 to save time at the beginning and end of each work day is worth it to me.

Thinking about gas in terms of price-per-gallon is probably about as meaningful as thinking of a grocery bill as dollars-per-pound.  Sure, you can figure it out that way, but what does it really tell you?  At the end of the day you still have to eat, and if you can afford to feed yourself and feel OK about the food, you probably are not going to grumble about a change in the price of your dinner.  Likewise, while you may talk about gas prices being an annoyance, you probably aren’t going to do much about it.  What you can do is figure out what the price of a trip is and then decide if you want to go.

Consolidate a couple errands into one trip rather than two or three and you could save more money than clipping coupons and without the risk of paper cuts.  Do both and you may come out better off than before gas hit $4 a gallon.  It seems we could all get smarter about where we go, when we go, and why we go rather than complaining about the cost of the trip.