Gasoline prices are rising again. A summer surge in demand, a new conflict between the U.S. and Iran and other global disruptions have pushed the national average price of gasoline above $4 a gallon for many Americans.
These high gas prices are an unwelcome additional expense for many families who are already on a tight budget. Thankfully, there are ways to deal with rising gas prices even if you don’t have a lot of extra money or can’t significantly reduce your mileage.
Here’s how to budget for rising gas prices and keep your finances on track even with high pump bills.
Who will be most affected by rising gas prices?
Rising gas prices will affect some households more than others. “Low-income earners and people living paycheck to paycheck are being hit the hardest,” said Evan Potash, executive wealth management advisor at TIAA Wealth Management. “They are already exhausted by rising food and rent inflation.”
This is especially true if you live in a rural or suburban area where public transportation is not available. “The households I’m most concerned about are those with long commutes, non-negotiables, and little flexibility in when and how they get to work,” says Michael McAuliffe, founder of Family Credit Management, a nonprofit debt management organization.
However, there are still some steps you can take to minimize the impact of rising gas prices on your household finances. Let’s start here.
Understand how rising gas prices affect your budget
No matter your situation, the first step in budgeting for rising gas prices is to calculate how much more you can realistically expect to pay.
“The average commuter will typically end up paying an extra $40 to $100 a month due to rising prices,” said Matt Twiford, chief financial officer at Pegacorn Group, a financial consulting firm. “It’s a pain, but knowing the actual numbers lets you know how much you actually need to adjust without panicking or cutting too much.”
To understand how rising gas prices will affect your budget, add up the cost of each fill-up and multiply by the number of times you expect to get gas in the next month. Compare this to what you were spending before. This will give you a general idea of how much more you can expect to spend.
If you already have a budget in place, you can easily look back over the last few months to see how much you’ve spent on gas in the past and compare it to what you’re spending now.
Or you can look at your past credit card transactions and receipts to see how much you’ve spent so far.
Adjust your budget to save on discretionary spending
Now that you know how much extra you’re spending, you can find other parts of your budget to cut back to accommodate the higher price.
Suppose you estimate that you will need to pay an additional $50 per month to compensate for the increase in gas prices. That basically means you have to make that money come from other areas of your budget.
If you already have a budget and know how to spend your money each month, that’s great. See if you can identify spending categories that you can cut back on. “Look at your discretionary spending and identify what’s your lowest priority. It could be a streaming service subscription, an expensive food delivery service, or a membership you don’t use often,” says Potash.
It’s easy to make even if you don’t have a budget. Go back through your transactions over the last month (or months) and figure out where you spent the most money and where you can temporarily cut back on spending. Budgeting apps can help automate this process.
Avoid paying for rising fuel costs with your credit card
Many drivers pay for gas with a credit card. But if you carry a balance each month, a high interest rate could mean you end up paying much more in the long run, even when you factor in extra fuel perks and credit card points.
“If an extra $75 at the gas station means motorists have to take on revolving debt, they could end up paying interest longer than the price increase,” said Stephen Min, chief credit officer at Credit One Bank.
So when gas prices are high, instead of just charging your credit card and paying it off later, it’s better to find room in your budget by cutting back elsewhere.
Protect your financial priorities
You don’t want your retirement or long-term savings goals to be jeopardized when gas prices rise. “If you have a plan to save a certain amount each month, stick to that plan and make adjustments in other areas if you need to increase your gas budget,” says Alison Donaldson, CFP, financial advisor at HTG Advisors. “A good savings plan has room for diversification.”
If you do need to take money out of your savings or reduce your retirement savings, take only what you need and minimize the impact as much as possible. Try to make up for the loss later when gas prices drop.
“Just try to be consistent and save as much as you can so you can make up for the lost time later when the market calms down,” Donaldson says.
Save fuel in small ways
While driving less isn’t an option for every household, there are still ways to minimize the impact of rising gas prices on your wallet. Consider the following tips:
- Use a gas rewards credit card and enroll in a gas station rewards program
- Get your gas at wholesale clubs and grocery stores that offer deep discounts
- Track your mileage while driving to work or volunteering with a charity and get a refund or tax deduction
- Compare local gas prices and fill up when you’re nearby with apps like AAA and GasBuddy
- Complete routine maintenance on your car, such as keeping tire pressure at the recommended PSI and replacing air filters.
- If possible, carpool with family, neighbors, and friends
- Organize your errands and reduce the number of trips you take
Prepare for future price increases
By being prepared, you can avoid being caught off guard the next time gas prices spike. “Create a small fuel cushion so that when prices unexpectedly rise, you can be prepared rather than reacting,” says Min.
That way, when gas prices drop, you can roll over the extra money to the next month. When gas prices rise, you can tap into the surplus instead of taking on debt or drawing down long-term savings.
You can do this by basing your fuel budget on past year averages rather than current prices. This gives you more leeway and makes your budget less vulnerable if prices rise.
Bottom line: Budget for rising gas prices.
Budgeting for rising gas prices can help you find ways to deal with rising transportation costs without taking on high-interest credit card debt or jeopardizing other financial goals. Ultimately, your best bet is to reduce discretionary spending as much as possible and prepare for future fluctuations.
With budgeting apps like Rocket Money and Quicken Simplifi, you can quickly identify where you can cut back and see your monthly gas bill. This helps minimize the negative impact of price increases.
FAQ
If gas prices rise, should you reduce your retirement benefits?
If possible, avoid reducing your retirement savings or withdrawing money from your retirement account to accommodate rising gas prices. If possible, start by cutting back on discretionary expenses like eating out.
Why did gas prices rise overnight?
Gasoline prices soared again in July after trending downward in June due to increased summer demand, new conflicts in the Middle East and other global disruptions.
How high will gas prices go in 2026?
The national average gasoline price in 2026 peaked at about $4.50 per gallon in May, and averaged above $4 again in July 2026. The U.S. Energy Information Administration projects that prices could average about $3.80 per gallon in the third quarter of 2026 and $3.40 per gallon in the fourth quarter of 2026. However, the Wall Street Journal predicts that gasoline prices may remain high for a long time due to soaring gasoline prices. Crude oil to gasoline conversion rates have recently reached new highs.
