Updated on 08.31.11

Saving Pennies or Dollars? Finding Cheap Gas

Trent Hamm

saving pennies or dollarsSaving Pennies or Dollars is a new semi-regular series on The Simple Dollar, inspired by a great discussion on The Simple Dollar’s Facebook page concerning frugal tactics that might not really save that much money. I’m going to take some of the scenarios described by the readers there and try to break down the numbers to see if the savings is really worth the time invested.

Darrin said, Driving around town looking for the cheapest gas prices for the day. Yes there are apps and web sites that tell you all that, but I don’t think about filling the car when I’m in front of my computer. I found a gas station that is usually a couple cents above the lowest prices, but it’s on my route to work so I stick to it now and have more time.

Let’s say, for instance, that you are driving a car that needs ten gallons in it and you only save $0.05 per gallon by driving around. That’s $0.50 in savings. If you’re driving a truck that needs eighteen gallons and you find a place that saves you $0.10 per gallon, that’s $1.80 in savings.

No matter what you do to save gas, you’re talking about a small amount per fill-up. If you drive around looking for cheaper gas, not only are you spending time doing this, but you’re burning gas in the process.

In my opinion, driving more than a few blocks for cheaper gas isn’t worth it. Even if you’re saving $1.80 in the optimum situation above, you’re still burning a bit of gas to get there and a bit of time to drive that extra distance. If you go further than that, your money saved continues to drop and your time spent continues to grow.

There’s also the factor that sites and tools that give you updated gas prices aren’t perfect. More than a few times, I’ve discovered the hard way that the prices listed in these tools isn’t accurate. Someone has uploaded bogus data as a prank or as a simple user error or the tool is outdated. When these sites work, they work; when they don’t, they don’t.

Instead, I use a completely different approach for gas. I invest some time up front figuring out which local station(s) consistently have the cheapest price on gas, then I use that station (or stations) as my primary place for filling up. Here’s what I do.

I monitor the gas price comparison sites for a week or two to see which stations in my area have the cheapest gas. This is really the backbone of my plan. If you’re in an area where prices are updated frequently, you can easily get a sense of which stations are consistently the lowest by watching such comparison data.

I also look for stations that have special deals in addition to the normal gas price. For example, the local Sam’s Club offers discounted gas to members and the local Hy-Vee Gas offers a discount if you bring in a recent receipt from a nearby Hy-Vee grocery store. Other gas stations offer tremendous discounts if you use their credit card.

Once I have this information in hand, I figure out which gas station is consistently the lowest (or tied for the lowest) in terms of gas prices. Usually, this is pretty straightforward once you know some of the offers available at the gas stations and what their regular prices are.

The winning gas station simply becomes my regular gas station. I use it for all of my gas purchases for a while until I get a sense that perhaps I should recalculate

While this process doesn’t guarantee me the lowest gas price at each fillup, it does ensure that I have one of the lowest gas prices around at every fillup. Even better, I’m not driving around to find this bargain. It’s usually a station along my regular route for groceries or other goods.

To put it simply, driving around looking for the cheapest gas saves pennies (at best), while figuring out your cheapest gas station in advance then using it regularly saves dollars over the long haul.

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  1. Nick says:

    “When these sites work, they work; when they don’t, they don’t.”

    I know it’s a bit catty but I can’t help but comment on how useless this sentence is.

    When things taste good, they taste good; when they don’t, they don’t.

  2. krantcents says:

    I don’t chase the cheapest gas, but I fill my tank exclusively at Costco. They generally are cheaper than all the stations 5-10 cents. In addition, I receive a 3% rebate.

  3. Other Jonathan says:

    I get all of my gas at the Shell near me unless I’m on a road trip. First of all, I pass it nearly every time I leave or arrive at my house, so it’s convenient. Secondly, it’s fairly cheap in general compared with other stations further away (at least on par). Third, I track my auto expenses and I like to have a consistent record of gas prices throughout the years, and using the same station helps that. Fourth, I really don’t care about saving a dollar a week on gas enough to inconvenience myself by finding a cheaper place that I don’t pass every day.

  4. Riki says:

    I live in a province with regulated gas prices. Twice per month, our regulatory body sets a range for the price of gas and as a result, every single gas station in town has exactly the same price.

    There are huge pros and cons to this system for sure, but we do avoid huge peaks and valleys in price and it definitely means I don’t have to worry about where to buy gas. It’s the same price no matter where I go.

  5. George says:

    In the Portland, Oregon, area, there are higher taxes and markups within the city and Multnomah County limits. It’s pretty straightforward for people to pick a station closer to home along their commute… for myself, that’s a discount station near the edge of the urban growth boundary in Clackamas County. Usually a dime cheaper than stations in Portland and the gas quality is good.

  6. Brittany says:

    I live in a neighborhood with some of the most expensive gas in the city (upscale commercial district with cheap housing). The gas across the the street from me is regularly 30 cents more a gallon than stations a mile or so out of my neighborhood. When I had a car, I filled up 10-11 gallons around 3 times a month. For me, getting gas outside outside my neighborhood saved dollars, not pennies. 10 cents was my “Is it worth it to go out of my way?” threshold. Granted, using my post-car-wreck insurance money to pay off my student loans and switching to cycling instead of driving has saved many more dollars than gassing up carefully.

  7. bogart says:

    I’ve found mapquest’s gas price (gasprices dot mapquest) site to be very accurate around us, and as there are a number of sometimes cheap stations near me but not en route along my usual routes (3 are within a mile of my home, 1 within a mile of my work, 1 within a half mile of the gym I use), it’s pretty easy to check which is cheapest from my computer before I plan my day. If for whatever reason I don’t get that done, then sure, I just go to one of those stations and hope for the best — but they’re in different towns and not direct competitors, so a $.10 difference per gallon isn’t unusual.

  8. Kerry D. says:

    We’re assuming in this conversation so far that all gas is created equal… does anyone know if it really is? My mechanic, who I do trust, has suggested that I buy name brand gas, rather than the cheapest, to take better care of my car.

    What do you think?

  9. Tizzle says:

    @8 Kerry: I used “name brand” gas in the past, and had it literally make my car not run. Presumably watered down, by mistake, per my mechanic.It happened twice. I thought my clutch had gone out. So,basically, it totally depends. Sorry for the imprecision of my answer.

    I drive for a living, not a big truck, just a car. For me, it’s very important to know where to get the cheapest gas. But for friends of mine who get decent gas mileage and only fill up once or twice a month, running around looking or even waiting, idling, in line at Costco isn’t worth it. In my state, the “cheap” gas is at least $0.20 cheaper than the nearest name brand station.

    For folks with smart phones, check out your app store. I have a free app called Gas Buddy that works (so far perfectly) when I’m in an unknown area.

  10. Tom says:

    I think the billshrink website has a pretty good gas finder, and its been accurate in my experience. You can put in home and work addresses and your expected MPG, and the tool will calculate how much you can save on gas.
    At certain times of year Discover and Chase, will have a cashback promotion. Costco AMEX has a gas rebate yearround.
    But I’m kind of with Trent on this one. I try to keep an eye on a few local stations and frequent the cheapest one.

  11. Tom says:

    As far as gas quality, I had read on an article about “boycott exxon for a day” that most gas stations are franchised and buy from the same supplier. So Exxon gas doesn’t always go to Exxon stations, for example. I have no hard evidence, so take that for with a grain of salt, but it could be likely that your local exxon, chevron, and “generic” all have equivalent gas

  12. Baley says:

    “No ethanol” gas is apparently better for your car and gets better gas mileage (if I’m not mistaken), but it costs more because of the government subsidies for ethanol. For what it’s worth…

  13. lurker carl says:

    I live in an area where fuel prices vary as much as 30 cents per gallon from block to block, the most convenient stations are usually the most expensive. When I need 30 gallons, I’m going a little out of my way for cheap and using a credit card that gives a 5% discount off fuel purchases. Paying almost 50 cents more per gallon for convenience doesn’t make cents, it wastes dollars.

    Big cities and their surrounding suburbs have prices all over the board. Small towns and rural areas tend to have more uniform pricing.

  14. Jonathan says:

    When you live in a town that only has 2 gas stations its really easy to know which place is the cheapest :-)

  15. David says:

    When I need gas, I check the prices on the way to work, and on the way home I stop wherever it was cheapest.

  16. If you don’t know who has the cheapest gas over the long run, look to see which stations pull in the most landscapers and delivery vehicles. They ALWAYS know who has the cheapest gas! You won’t discover anything they don’t aready know. That’s one way to find out without doing a lot of driving around.

    Some stations use gas as a loss-leader to draw customers who buy their other products. They’ll alwys be cheaper than the competition because that’s their business model. In my area QuikTrip has been the cheapest on gas for years (that’s where all the landscapers and delivery trucks go in my area).

  17. joan says:

    Every time I fill the gas tank, I figure how many miles per gallon I got from the last fill-up. I keep a complete record of milage, what station, how many gallon, price per gallon and etc. I have found that some stations give me more miles per gallon. They may not be the cheapest in price, but figured per gallon, they are the cheapest. It takes about two minutes to keep my record up to date.

  18. Georgia says:

    With the last 5-6 cars I have kept complete records of all monies spent on the car – gas, repairs, maintenace. I also keep info on each gas fillup, such as cost, price per gallon, gallons put in, miles per gallon per fillup. It has been a life saver for me on taking care of my car and knowing what is needed, and when.

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