What do rising gas prices mean for your budget?

As a personal and small business accounting services business, we look at a lot of numbers! It should be no surprise that we’re watching the gas prices and budget numbers for ourselves and our valued clients.

AAA Arizona is reporting the average Tempe, AZ gas price on March 5, 2012 as $3.886 per gallon as compared to $3.764 the previous week. The average of $3.422 per gallon of the same week in 2011 seems a distant past and a price we won’t see until…well, who knows. The talking heads are guessing $5 per gallon prices in our near future, prices more similar to countries like England where fuel is reportedly $10 per gallon.

  • Forbes.com reports Americans spend an average of 3.7% of their income on gasoline and motor oil, a number that by many accounts is sure to rise if it hasn’t done so already.
  • Forbes reports, “The average American household spends 7.7% of their budget on food at home, 5.6% eating out, and 1.1% on alcoholic beverages.”

H&R Block put an infographic together illustrating the rise of gas prices in America. The average number of gallons was estimated at 558 gallons per year. We have taken that number to illustrate the impact of gas prices on the average American wallet.

Avg gallons per year price per gallon total annual year



 $        948.60




 $     1,909.48




 $     2,168.39




 $     2,237.58




 $     2,795.58


In 2001 the average gas price was $1.70 per gallon or an annual cost of $948.60. In March 2011 the average price per gallon was $3.422 or $1909.49, DOUBLE the cost of a decade earlier! When (not if?) prices hit $5 per gallon the cost will be TRIPLE what it was in 2001. Ouch!

If we all had an infinite amount of cash we wouldn’t care as much about these numbers as we do. The fact of the matter is our budgets are tighter and we are making tough decisions that impact our families and communities. We want to hear how the rising gas prices are impacting your financial decisions.

BASC Expertise is a Mesa based provider of accounting and tax services to individuals and small business owners. We are currently accepting tax prep appointments. Make your appointment today by calling 480-355-1398.


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