Rising gasoline prices don’t just hurt Americans’ pocketbooks. They also cut into the social fabric, forcing a majority of Americans to forgo family visits, cut back on vacations and even curtail that old Sunday afternoon drive, according to a new CreditCards.com poll.
|Trouble at the pump: Gas prices curbing travel enthusiasm|
What the CreditCards.com poll found:
Americans say high gas prices have caused them to cut back on:
Advice from the experts about coping with high gas prices:
What’s out? Extra curricular activities such as karate classes and cheerleading camps for the kids, going to the latest movies and multiple runs to the grocery store.
What’s in? Car pooling, public transportation, dining in, keeping the car in top shape (oil changed and tires properly inflated) to conserve fuel, one weekly grocery store run and budgeting.
A majority of American adults (53 percent) say the cost of gasoline has caused them to cut back on driving to visit friends or family. Nearly two-thirds of those polled (66 percent) say driving for enjoyment has decreased because gas is too expensive, according to the poll, conducted by GfK Roper Public Affairs and Media for CreditCards.com. The telephone poll included a representative sample of 1,004 American adults surveyed May 16-18, 2008 (see poll methodology).
Other gas-related cutbacks revealed by the poll include driving for vacation (54 percent) and driving to run errands (56 percent). In all, nearly four out of five Americans admit they have given up something — whether it’s driving for enjoyment or errands, visiting friends and family, vacation road trips or commuting to work — because of the gas crisis.
“People can no longer afford a Sunday afternoon drive just to pass the time of day,” says Gail Cunningham, spokeswoman for the National Foundation for Credit Counseling (NFCC), a nationwide group of nonprofit credit counseling agencies.
“We had to tell many people that this year they will not be able to afford their family vacation due to the cost of driving to their destination or increased airfare,” says New Jersey debt counselor Kim Cole. Does that mean the family reunion, too? “This year, yes.”
She adds: “Anything extra that you may have been able to afford before, you may not be able to afford now with the increase in the gas prices.”
Tipping point: Are we there yet?
Oil and energy experts and consumer advocates have long held that Americans were so enamored with their cars, trucks and SUVs that it would take significant increases in gas prices to get them to kick their driving habits. As the national average gas price inches toward $4 per gallon, the poll shows more people may be reaching the tipping point.
“At the end of the day, the economic realities of the American household will require a shift to accommodate shortfalls,” says Jose Garcia, a senior policy analyst at Demos, a nonpartisan public policy research and advocacy group. “If they are having trouble covering gas costs, they should look for transportation alternatives such as car pooling or public transportation.”
Other poll results include:
- Southern hospitality has taken a back seat to saving money on gasoline. Residents of the South (58 percent) are more likely than people from other regions to say gas prices have caused them to cut back on visits to family members and friends.
- Older adults are least likely to give up visits to family members and friends because of gas prices. Only 45 percent of people 65 and older say they cut back on these outings because of gas prices. Nearly 59 percent of people 18 to 34 years old and 57 percent of those 35 to 49 years old say they have cut back on family and friend visits.
- The groups reporting the most cutbacks on family vacations are those earning $30,000 to $49,900 a year, young adults and those living in the South.
- Americans with lower household incomes (under $30,000) are more likely to say they are cutting down on their drive to work, compared to their higher income counterparts.
- Younger adults (ages 18 to 34) have cut back on driving to work more than any of their older counterparts.
- People living in the Northeast were least likely to say they have cut back on driving to work due to gas prices.
- Driving for enjoyment has taken a big hit from gas prices: Of all Americans, 66 percent say they’ve curtailed that activity. Those in Western states are least likely to cut back on pleasure cruises (62 percent).
Work habits die hard
The poll asked whether gas prices have caused people to cut back on:
|Percentage of Americans who have cut back on driving activities due to the cost of gas|
- Driving to work.
- Driving for enjoyment.
- Driving to visit friends or family.
- Driving to or from vacation.
- Driving to run errands.
“Driving to work” is the only choice that failed to draw a majority. Just one in four say they have cut back on driving to work due to gas prices. “That makes perfect sense,” says the NFCC’s Cunningham. “When money is tight, the last thing you want to do is jeopardize your job, thus, consumers are not toying with that area. Nonetheless, they should weigh the advantages of continuing to drive themselves to work versus car pooling and public transportation.”
A small but growing number of employers are offering gas and commuting incentives to help workers get to work. A May 6, 2008, survey of 553 human resource managers found the percentage of companies offering gas cards as employee rewards more than doubled between 2007 and 2008 — from 6 percent to 14 percent. The study, conducted by the Society for Human Resource Management, also noted that companies are organizing car pools, offering telecommuting options and public transportation discounts and giving cash incentives for employees to buy hybrid cars.
Debt counselor Cole says the impact of the gas price hikes has hit home for a lot of the clients she counsels. Many are making changes, sacrificing family outings, the kids’ sporting events and even food to pay their rising gasoline costs.
“Some people that I’ve spoken to are actually looking at changing careers,” says Cole, a senior counselor at Novadebt, a New Jersey-based consumer credit counseling agency and member of the Association of Independent Consumer Credit Counseling Agencies.
“I have a client who had to receive medical care at a hospital that was quite a distance away and had to reduce the amount of trips she made for cancer treatments,” Cole says.
— Kim Cole, Novadebt
Clients whose long job commutes are eating up more of their budgets are finding closer job alternatives, she says. People living in rural areas — where public transportation is scarce, car-pooling is limited and long commutes are common — are having the most difficult time handling the gas price increases, she says. Cutting back on driving is often not an option. “Somebody who is in a small Minnesota town may not have that luxury,” Cole says. “Work is an hour’s drive away and they don’t have a choice.”
Tips for minimizing gas consumption
If you’re the type of person who makes several runs to the grocery store each week because you forgot to buy something on your last trip, best get organized. Those extra errands are burning up valuable gas.
“Our advice is to bundle your errands geographically so that you’re not zigzagging all over town,” says NFCC’s Cunningham. “Further, keep a list of needed groceries and try to not go to the store until it’s absolutely necessary. Shopping online, where appropriate, may become more appealing as the cost of gas continues to rise.”
Lynne Strang, a spokeswoman for the American Financial Services Association Education Foundation, an organization that focuses on teaching money management skills, suggests budgeting and controlling expenses.
“We recommend that what people do is take a look at their budget and take a look at what they’re currently allocating for gas as well as other household expenses,” she says. “The money you’re spending dining out or at the local coffeehouse, maybe take a look at those things.”
Although debt managers advise their clients to dine in more often, data from the National Restaurant Association suggests few may be heeding that advice. April 2008 was a record month nationwide for restaurant sales, says Hudson Riehle, the NRA’s senior vice president of research.
Convenience appears to trump cash flow. “Consumers now incorporate restaurants into their daily lifestyles on a central basis,” Riehle says. Still, mindful of the gas crisis, some restaurants across the country are stepping up efforts at cell phone and online marketing and food delivery services.
Getting poll results. Please wait…
Are the gas prices killing vacation road trips this summer? A few tourism groups, vacation destinations, restaurants and hotels are offering incentives — in the form of gas rebates and other discounts — to attract guests. The majority of visitors to Branson, Mo. — located almost exactly in the middle of the country — drive in to see the Ozark Mountains, lakes and musical attractions there.
Last year, owners of the Branson Tourism Center, a privately owned vacation package marketing company, began offering discounts on gas to entice driving vacationers. The company offers 20 to 40 cents off per gallon when visiting families fill their tanks at the tourism center, says Sean Murray, the center’s creative director. Murray says gas in Missouri is slightly cheaper (by about 10 to 15 cents a gallon depending on the octane) than the national average.
“We have found that people may cut corners for certain things,” Murray says. “They may not go to Europe. They may not go to Disney. They say ‘Maybe we can’t go to Orlando, but we can do this.’ They make local choices. They still like to have that release. They like to have that connecting moment with families. Americans aren’t willing to let loose with those.”
Officials at Walt Disney World Resorts, meanwhile, say the gas crisis won’t likely deter visits to the popular Orlando theme park.
“Historically, we at Disney have not been noticeably impacted by gas prices,” says Disney spokeswoman Kim Prunty. “Even when you look at the increase in gas prices, gasoline represents a relatively small portion of the vacation’s cost,” Prunty says. “Our guests have been planning their vacations for quite some time and it’s not something they are willing to give up.”
— Lynne Strang, American Financial Services
Association Education Foundation
Strang, from the financial services association, says a road trip vacation may not be practical for a lot of families and many should think local: “You can still have a vacation without necessarily having to travel very far — if at all. It’s still possible to enjoy a vacation but you may need to do so on a more modest scale.”
Buying gas with credit cards can save money, if consumers choose wisely. Many traditional one-chain gas cards are falling from favor, supplanted by multipurpose cards that offer rewards and cash-back incentives. Single-chain cards offer the highest rewards, but multipurpose cards let consumers save any time they spot a station with cheap gas prices. However, using a credit card to buy gasoline makes sense only if consumers pay off their balances each month.
“Watch the use of gasoline credit cards at this time. With the higher price of gas and interest rates, they will be paying considerably more,” says Cole, the Novadebt counselor. “Unless they are paying off the balance in full — and unfortunately, most people don’t — they should avoid putting it on a credit card.”
The survey was conducted from May 16-18, 2008, by GfK Custom Research North America on behalf of CreditCards.com, via random digit dialing phone interviews with 1,004 interview subjects. Interviewees were approximately split between males and females ages 18 and over, with 523 females and 481 males surveyed. The raw data was then weighted by a custom designed computer program that automatically developed a weighting factor for each respondent, employing five variables: age, sex, education, race and geographic region.
The total margin of error on weighted data for the full sample is plus or minus 3 percentage points at the 95 percent confidence level.
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