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by Rebecca Lake
Lower gas prices are a good thing for your wallet because it means you’re spending less at the pump, but how do you save when gas spikes up? If your daily routine involves a lengthy commute, you’re constantly shuttling kids back and forth to activities or a road trip is part of your summer travel plans, it pays to find ways to cut corners on the cost. The next time you’re in the driver’s seat, keep these budget-boosting tips in mind.
1. Ease Up On The Gas Pedal
Driving more slowly can save you money in a couple of different ways. Research has shown that for every five miles you drive over 50 mph, you’re burning up an extra $.24 per gallon of gas. That doesn’t sound like a lot but if you’ve constantly got a case of lead foot, you’re going to be filling up a lot more often, costing yourself more in the process.
Taking your speed down a notch can also impact your odds of being involved in an accident. The National Highway Traffic Safety Administration estimates that as many as 20% of all car crashes are caused by speed and nearly 30% of fatal crashes are speed-related. Getting into an accident, even a minor one, can jack up your car insurance rates. On the other hand, being accident-free could earn you a discount on your premiums with some insurers.
2. Get A Tax Break If You Use Your Car For Business
If you spend time on the road traveling for business, the IRS allows you to write off certain expenses on your taxes. Generally, you can base your deduction on the standard mileage rate or your actual expenses. Actual expenses includes things like registration fees, repairs, tires, gas, oil, garage rent, parking fees and tolls. Just be sure you’re keeping good records of your mileage and copies of your receipts in case Uncle Sam decides to take a closer look at your return.
Commuters can’t deduct those same expenses but they still get some tax perks in the form of transportation fringe benefits. As of 2016, commuters can get up to $255 a month tax-free for both transit and parking, for a combined total of $510. Your employer gets a tax deduction for offering these benefits so if you’re not sure whether your company participates, it’s worth a call to HR to find out.
3. Join A Gas Discount Program
Gas prices are low for now but there’s no guarantee that they’ll stay that way. Enrolling in a loyalty or rewards program that offers a per-gallon discount is a smart way to ensure that you’ll still save even if prices go up. For example, supermarket chains like Kroger and Lowe’s Foods let you save at the pump when you spend on groceries.
WalMart shoppers can save on gas at Murphy USA when they pay with a WalMart gift card, credit card or prepaid debit card. If you’re using a rewards or gas credit card, make sure you pay the balance in full each month so the interest charges don’t detract from anything you’ve saved on gas.
4. Use A Great Credit Score To Snag Better Insurance Rates
With the exception of Hawaii, Massachusetts and California, car insurance companies in most states can use your credit score to decide how much you’ll pay. A lower score might make you appear riskier, leading to more expensive premiums while having a good credit score could have the opposite effect.
If your credit score could use some retooling, sticking to the basics can help you to improve it. Paying your bills on time, keeping your balances low and applying for new credit sparingly all work together to boost your score. Take our quick two-minute assessment to see just how important your credit score is not just for your insurance rates but your bigger financial picture.
About the author
Rebecca Lake
Rebecca Lake is a personal finance writer and blogger specializing in topics related to mortgages, retirement and business credit. Her work has appeared in a variety of outlets around the web, including Smart Asset and Money Crashers. You can find her on Twitter at @seemomwrite or her website, RebeccaLake.net.
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