Well, at least it is most of the time.
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 have put my trusty spreadsheet to work 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 $4.00 per gallon of gas. Looking at the bottom chart, which assumes the car averages 20 miles per gallon, we can see that you spent $2.00 driving to the station with the lower gas price. So in reality you lost $1.52 ($2.00 – 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.
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 your driving around and your tank is running on empty, don’t fret too much 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.
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Hi
Interesting.
Here in South Africa – where I live – petrol prices are fixed inland and at the coast. So, one needs to drive really far for a cheaper price!
Juliet
Hi Juliet,
If we did that here in the States (fix gas prices), membership stores that offer discount gasoline (like Costco) would be filing for bankruptcy!
Two other notes:
1. I love the word “petrol.” In fact, I am going to write my local Congressman and ask him to sponsor a bill that would make “petrol” the official American word for gasoline.
2. I’ve always wanted to go to South Africa. I hear it is very beautiful.
3. (I know I said 2 things, but I just thought of something else…) I have a beautiful Rhodesian Ridgeback – Ridgebacks are the best dogs on the planet! I know Zimbabwe Rhodesia isn’t South Africa, but if I remember my high school geography, it’s right next door. No real point to make here. I’m just rambling again…
Len
We have a little neighborhood gas station that usually runs a nickel to seven cents more than everyone else. There is hardly a time there are more than two cars being filled up at any given time, including ours, so it is always a quick easy-in-easy-out. The older we get saving a nickel here or there has to be weighed against the time spent looking for the bargain
.
.-= Steven and Debra´s last blog ..Fannie Mae and Freddy Mac Krueger: Final Nightmare on Main Street? =-.
I’m with you guys! It usually just doesn’t pay to shop for a couple cents of savings.
There is a gas station near me at $2.83 per gallon vs $3.00 pretty much everywhere else.
So for me, I save 17 cents per gallon if I drive a little further out to get to that gas station.
I think that’s worth it.
It all comes down to the math, Steven. Whether it is a good deal or not will all depend on how far away the cheaper gas station is.
Gas prices these days are just getting higher, i think the government should focus more on alternative energy.
When filling up a large empty tank those few cents can add up, you really need to figure it out if it’s really worth the drive for your car. Like you said, it’s all in the math. Another thing, I’ve noticed that often cheaper stations are VERY busy. For example; Costco where there always seems to be a long line of compact cars waiting 30 minutes to save 30 cents.
I too, more often than not, see cars waiting in line three, four and even five deep waiting to save maybe a buck a tank. It makes absolutely no sense to me either.
[...] Shopping For Low Gas Prices Is A Losing Proposition is argued by Len Penzo. [...]