With gas prices reaching an all-time high, many people wonder what that may look like for the overall economy and for their bank accounts, rightfully so, with some parts of the country reaching four dollars and 33 cents a gallon and in california over seven dollars. For a gallon of gas, it's very obvious that this is going to hurt some people's bank accounts and if it were to hit 10 a gallon, it may just break citizens of the united states. I want to dive into today what that would look like logistically for you and why you should be concerned about current gas prices. Looking at all households with a 50 000 a year, salary about 80 percent of these people have a vehicle that they will drive to and from work with, and about 20 percent of these people will use public transit in order to get where they want to go.

You may be thinking to yourself if i live in california and i'm using public transit. Maybe i don't have to worry about gas prices, but these people will also be affected by the rising price of gasoline. So the question is: can americans actually afford the currently rising prices of gasoline? Well, let's just break down what the average american makes a month and spends a month and do a little bit of number crunching basic napkin, math basic american expenditures could include things such as rent falling at about 997 dollars a month utilities for 166 dollars a month. 113, a month for their phone service 75 a month for cable and internet 550 a month for groceries, 465 a month on their car payment 65 a month for car insurance, 104 a month for an individual health insurance plan and whatever other expenditures that may include for The average american well that doesn't seem too bad right that comes out to about 67 000 a year, but it's all about income versus expenses and if you were to add up the average expenses of all the things that we listed above just taking the average american.

Excluding emergency money and excluding taxes about 2 535 dollars needed for just basic essential needs going out to eat hanging out with your family travel. It's very obvious that most americans making the median salary are living just barely above paycheck to paycheck, for the time being, factoring that, in it's very obvious, that rising gasoline prices can be a cause for concern for the average american and i'm going to punch those numbers For you right now so first to understand why gasoline could be an issue and a cause for concern for the average american. You have to understand how much americans drive, and this comes into some basic data information which will be sourced down below the us vehicle fleet returned an average of 24.9 miles per gallon commuting around 32 miles round trip per day. Your average car on the road can carry about 16 gallons and with current gas prices on average, reaching 4.33 cents a gallon.

When you pull back that joe biden sticker on the pump revealing the total cost for a fill up being 68.96, some people have reason to be concerned. But i personally believe that you are just starting to witness what is actually going to happen with gas prices increasing. Why is this issue for concern? Well because we haven't seen gas prices like this since 2008 and what happened after 2008 when gas reached nearly four dollars? Is it stayed high for years to follow up until right, around 2014 and 2015.? We got really close in 2012. Around 3.78 cents a gallon and that trend rode until 2014, but americans have been used to the median price of 233, a gallon for a couple years now, to say the least.

So now that we know right all the basic expenditures and expenses of an american. You know totaling most of their paycheck, excluding taxes and if you take the median of about 22 tax uh, most americans are taking 500 off of that 4800 a month. So, let's factor gas prices reaching a total of 10. What would that look like the average person fills up their car once a week which would total about 160 dollars a week, which is also 640 a month, resulting in 7 680 a year at 10, a gallon doing only the basic commuting of about 30 miles a Day, but what if you have a longer commute to work? What if you, you drive an hour an hour and a half back and forth just to get to your job? Well, if you're filling up two times a week that totals about 320 a week or two hundred and eighty dollars a month, that's about fifteen thousand three hundred and sixty dollars a year, which is a very large chunk of your sixty seven thousand dollar average income.

For an american, if you're filling up three times a week, forget it you might as well look to public transit, but not actually. Why? Because public transit is going to get hit just as hard public transit prices, typically move in tandem to offset their fuel costs at the individual level. Higher gas prices mean that each of us pay more at the pump the average american. If you can't afford a car and you're going to public transit, well you're going to be hitting just as hard as those who would be fueling up at the pump as you pay more for your fares at public transit at a bus, stop! Well! What about electric vehicles right? There's those people who drive teslas they've got their model threes they're model-wise, who are probably pointing and laughing at uh people driving gasoline-driven vehicles.

You know: that's not really accessible to a lot of average americans, the cheapest tesla being in the range of uh. You know not the average cost of a lower class, or maybe even a mid-class american. Most people don't have that sort of accessibility for the time being. At least until tesla can make a more affordable electric vehicle or another company can do something similar given supply issues already with us.

Car market newer vehicles are few and far between, especially at an affordable price point for the average american elon musk and tesla have been trying to reach that 30 000 price point for years now and haven't quite been able to do it, leaving potential gas savings and Tax benefits as a way to convince potential buyers that is affordable. Potentially, although higher gas prices eventually encourage consumers to cut back on driving or switch to more fuel-efficient vehicles in the short run, they may have few options but to cut back on their spending and what that would look like for the economy. So now that we've done some basic napkin math, you understand the options sort of available to americans. You realize that you know an electric vehicle really isn't an option for a lot of people.

Sometimes people who take public transit won't be able to afford that gas prices. Taking up maybe a quarter of your your monthly expenditure uh, it's obvious that there's going to be some tolls, some some repercussions to the economy and to the average american and to you to what your bank account is ultimately going to look like. So, let's go over that since low and moderate income families spend most of their income on average in the very short run, they can only choose between spending less on other items and going further into debt. So what does that leave you? It leaves you i'm either going to go further into debt, maybe use a credit card on the pump swipe now pay later or you have to cut back on other expenditures.

Maybe this means people aren't making their rent payments on time. Maybe this means that they're not putting cash back into the economy, which could actually decrease the amount of spending that you see out of the average american, especially the middle class or lower class american, and by the way, this average income of about 67 000 a year. Definitely does not consider the lower class americans, perhaps college kids, who are only able to work a part-time job and maybe their monthly income is a thousand or two thousand dollars a month. You're gon na be going to work to make a check only to fill your gas tank to go back to work.

It's very obvious that there's some conflicts here in terms of what this is going to mean for the average american, and on top of that, if we can learn anything from history, you look back between 2008 and 2014 and it's very obvious that gas prices stayed high For a prolonged period of time, so if you think this is a blip, if you think this isn't something to be concerned with, i think history would say: that's a mistake. I think history would point in the direction of this is actually going to make an impact on how much americans are able to spend and save on a month-to-month basis. In addition, less spending on other items operates much like higher taxes and slowing an incipient recovery. That means that these families got hit twice once by the direct impact on their household budgets, but a second time when higher prices hamper the economic recovery with electric cars, often reaching a price tag unattainable by the middle class.

It seems that it is an unrealistic option in the short term, at the very least until there are more optionalities for your average american. Even turning your current vehicle for a cheaper one seems like an unlikely option. As the used car supply is currently dwindling, with no reversal in sight, this leaves many people wondering how they will survive if gas price is worth to continue and to be completely frank, unless you're able to increase the amount of money that average american can make or You can decrease the cost, you're kind of at a loss for words right now. You have to choose whether or not as an average american you'd like to include more debt, or you would like to decrease your amount of spending, maybe miss some bills and that's not a place that i think americans should be in.

So how will gas prices affect? You and what will this mean for you as an average american if gas was to hit ten dollars? So let me know in the comment section down below what you think of this appreciate you taking the time to watch. I'd appreciate it also, if you drop a like on the video consider subscribing if you uh, if you want to see more stuff like this, that's what we've got for this video. So, at the end of the day watch your bottom dollar take care of your pockets and let's hope that joe biden and the politicians within our country can find a way to keep gas prices a little more affordable for the average american or we're going to be Buying horses to ride into work, just like just like the old days, that's what i've got for! You guys appreciate you tuning in peace.