Millennial Question: Gas prices are killing my wallet. My job cut back salaries, but didn't lay any of us off. With fewer dollars this year and higher gas prices, what practical steps can I take?
Answer
There are five potential solutions for higher gas prices that only involve practical steps. For specific financial advice, seek a financial advisor, as you may have some financial options relative to your work or housing situation that could help you.
1. The most important solution is to adjust all your goals/plans/dreams for high energy prices. Assume, from now on, that gas prices will be ten dollars a gallon. Why do I write this? Because when we prepare for the worst, the worst doesn't surprise us as well as the worst is factored into our plans. Think about how many people would be shocked by $10 a gallon. But if you prepared for it, then you would be ready.
As a pertinent addition to the above, I know several geologists who state that the world has enough oil, but that it's difficult to obtain this remaining oil. In other words, oil prices may rise because it will cost a significant amount of money to obtain the world's remaining oil. Outside of innovation or reduced demand, we may see permanently higher oil prices than the $0.89 per gallon that I saw growing up. In fact, after this oil price spike to $4-$5, I doubt that we'll see a sustainable oil price-per-gallon below $2 for a long period of time.
In the least, I wouldn't be planning for a low oil price going into the future.
2. How can you minimize your travel? For instance, if you commute long distances to work, can you move closer to work? Can you minimize the amount of time you travel - whether to the store, social events, et cetera. Can you consolidate activities - for instance, shop after you spend time with friend by choosing a social location with good stores near.
Remember, what you see now may be the norm.
This is also another recommendation to speak with a financial advisor, who has some tax experience. Ask them if you can save anything here for commute or other activities. You may not have an option, but it's always worth a check.
3. Consider your where and what vision. What do you do? Where do you live? Given the cost of gas, is there a where you live that fits better with what you do? This is a big picture question, but it can carry big weight. I've spoken with many young men who've moved to Asia because they found jobs that paid slightly less than in the United States but with over 80% less of the expenses. When you run the numbers, you realize that those salaries go much further in Asia than the United States.
In addition, Asia has less of a toxic attitude toward young men, so for these young men, this is a double win.
