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How to Save Money on Gas, With or Without a Federal Gas Tax Exemption


The recent spike in gasoline prices is now being felt almost everywhere.

The national average for a gallon of gasoline is currently $4.94 after topping $5 a gallon for the first time earlier this month, according to AAA. Last year at this time the price was $3.07 per gallon.

The rise has strained most workers’ ability to cover expenses and save for the future, according to a recent report by DailyPay, which surveyed more than 2,000 adults in May.

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Hourly workers have an even harder time coping, according to the report. About 81% said rising gas prices had a negative effect on their ability to afford basic necessities.

As a result, 44% of households earning less than $100,000 per year reported saving less than last year or not saving at all.

To make ends meet, 22% of hourly workers said they had to take out a payday loan, one of the most expensive ways to borrow.

To provide immediate relief to pump prices, President Joe Biden has asked Congress to temporarily suspend the federal gas tax for three months. The federal tax is 18.4 cents per gallon for regular gasoline and 24.4 cents per gallon for diesel.

“Would that help? Yes, but having said that, I don’t think there’s much chance of success,” said Patrick De Haan, head of oil analysis at GasBuddy. “There’s a lot of politics intertwined here.”

Additionally, if a gasoline tax exemption coincides with rising wholesale fuel prices, consumers will not see much of an impact at the pump as the tax movement would be offset by the higher cost, noted De Han.

On the upside, prices have already started to fall due to the falling cost of oil, which is the key ingredient in gasoline.

“We have already seen prices go down, which is good news,” De Haan said. By the 4th of July weekend, “hopefully we’ll be somewhere 5-15 cents down.”

4 ways to save on gas

With or without a federal gasoline tax exemption, there are ways to protect yourself somewhat from prices at the pump. Consumer savings expert Andrea Woroch has these four tips:

  1. Track gas prices. Apps like GasBuddy, Gas Guru, and AAA TripTik can find the cheapest price per gallon at nearby gas stations. You may be able to save up to 30 cents per gallon, depending on where you fill up. Even if the difference seems small, it can still amount to hundreds of dollars a year.
  2. Pay in cash. The price per gallon can be 10 cents to 15 cents more per gallon for credit card transactions. Instead, pay cash to get the lowest price or use a cash back credit card to earn up to 2% on these fees. CNBC’s Select offers a comprehensive roundup of the best cards for refueling based on your spending habits.
  3. Drive strategically. Carpooling between work and school or playing sports can significantly reduce your time on the road. You can even find rideshares using sites such as ZimRide, RideJoy or eRideShare.com, Woroch advised. Plus, order online and look for free shipping to reduce the cost of groceries, takeout, and other everyday essentials.
  4. Sign up for loyalty programs. Additionally, loyalty programs, which many large gas station chains have, can help offset the price at the pump. Some grocery store chains may also offer cents per gallon rewards. For example, Kroger and Shop & Stop offer fuel points for every dollar spent on groceries, which can be redeemed at participating gas stations.

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