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Thinking about taking a road trip? The rising cost of gas might put a dent in your budget if you’re not careful. But how much will you spend on gas for a trip? What should your budget be?

Using a trip cost calculator can help you determine what you are likely to spend filling up your tank on a longer trip. Then you can use that information to decide whether it’s more cost-effective to drive, take a train or bus, or fly.

Let’s look not only at a gasoline cost trip calculator table, but also why you should calculate how much you’ll spend on gas and how you can save money filling up at the pump.

Why Use a Gas Cost Trip Estimator

You may think nothing of filling up your gas tank every few weeks when you’re only driving to work and the store. But consider how much gas you’d use for a trip from, let’s say, San Diego to New York City. With gas prices on the rise, understanding what it will cost you to fuel up for an entire trip can help you better budget your expenses.

Using a gas trip cost calculator can help you figure out how much of your entire trip budget will be dedicated to fueling up.


💡 Quick Tip: Online tools make tracking your spending a breeze: You can easily set up budgets, then get instant updates on your progress, spot upcoming bills, analyze your spending habits, and more.

How to Calculate Your Gas Cost Trip

To figure out how much gas will cost for a road trip, you can, of course, use a trip cost calculator. You’ll need to input basic details, like your type of car (different sizes and types of cars burn gas at different rates) and your route, and the calculator can estimate with real-time gas prices.

But a simple method is to look at your route and the total distance in miles, and divide this number by the number of miles per gallon your vehicle gets. (You can check your owner’s manual to find this out if you don’t already know). This will tell you the number of gallons of gas you’ll need for the entire trip.

Now you’ll need to know the price of gas so you can multiply it times the number of gallons you need. Since gas prices by state may vary wildly, you might take an average of prices found in five places along the way. Tools like Gas Buddy let you search for gas prices in a given city, so you can use this for research.

Gas Cost Trip Calculator Table
Let’s use the process I outlined above to illustrate how you can be your own gas calculator for trip costs.

As you can see, it would cost about $410 for gas for the entire trip. Of course, this is based on an average cost of gas, and prices will fluctuate over time and in different towns and cities.


💡 Quick Tip: Income, expenses, and life circumstances can change. Consider reviewing your budget a few times a year and making any adjustments if needed.

Examples of Gas Cost Trips

Let’s look at a few other examples of trips and how much they would cost in gas.

Reasons to Calculate Your Gas Cost

So why should you bother using a road trip cost calculator? Well, most people don’t have unlimited funds when it comes to taking a road trip, so for starters, it can help you see how much you’d spend. You might decide it’s not worth driving if the cost exceeds what you’d pay for a flight, bus, or train ride.

Even if you’re not planning a big trip, looking at how much it costs to drive on a tank of gas can be helpful for maintaining your month-to-month budget. Once you understand how much you’re spending on gas, you might explore how to improve gas mileage to get more bang for your buck or you might limit how often you drive to save money.

Tips on How to Save on Gas Money

Speaking of saving money, let’s look at how to save money on gas.

Plan Where You’ll Fuel Up

If you’re planning a road trip, use a tool that shows you exactly where the cheapest gas can be found. You might be able to save $.10 or more a gallon simply by planning ahead. There are even some trip fuel cost calculators that will help you plan where to stop based on gas prices.

Consider How You Pay

There are different types of credit cards that can help you save at the pump. Branded gas credit cards often offer rewards that will shave off a few cents per gallon or give you a bonus after you’ve charged a certain amount of purchases.

You might also consider a cash back credit card that gives you cash or credits for your purchases once you’ve hit a certain threshold.

Look into Alternative Transportation

You may be quick to rely on cars to get around, but there are often other overlooked methods of transportation to consider. Whether it’s a bus, train, Uber, or plane, you might be able to save money by leaving your car at home.

You can also cut your gas costs by splitting them with a friend.

Another way to stick to your travel budget? A money tracker app, which can help you keep tabs on where your money is going while you’re on the road.

Only Use Premium if Necessary

Most cars run just fine on regular unleaded gas, which can be significantly cheaper per gallon than premium versions, especially if you’re on a long trip. Check your car manufacturer’s recommendations to see if you can use regular unleaded gas.

Drive an Empty Car

The heavier your car is, the more gas it burns. So if you’ve been lugging around something heavy unnecessarily, consider leaving the load at home before you drive.

Who Should Save Money on Gas

The real question is, who shouldn’t save money on gas? We could all benefit by keeping a little extra cash in our pockets.

That said, if you’re planning a long road trip, you’ll probably want to explore ways to improve gas mileage and to save on gas. Also if you have a long commute to work, you might be spending more on gas than necessary.

The Takeaway

Paying attention to how much gas costs, particularly for a road trip or long commute, is just smart financial planning. Whether you use an online version or crunch the numbers on a piece of paper, a gas trip cost calculator can help you figure out how much you may want to budget for fill-ups.

Take control of your finances with SoFi. With our financial insights and credit score monitoring tools, you can view all of your accounts in one convenient dashboard. From there, you can see your various balances, spending breakdowns, and credit score. Plus you can easily set up budgets and discover valuable financial insights — all at no cost.

See exactly how your money comes and goes at a glance.

FAQ

How do I calculate gas cost for a trip?

To calculate gas for a long road trip, divide the number of miles of the route by the miles per gallon your car gets. This is the number of gallons you’ll need to drive the distance. Then, average the cost of gas on your route and multiply this times the number of gallons to get the total cost of gas for your trip.

How much would 1 mile of gas cost?

Divide the cost per gallon by the number of miles per gallon your car will go. For example, if you pay $3.99 per gallon and your car gets 22 miles per gallon, driving one mile would cost about $.18.

How do you calculate fuel to destination?

To calculate how much fuel you’ll need to get to your destination, divide the number of miles of the remaining route by the miles per gallon your car gets. Then, average the cost of gas on your route and multiply this times the number of gallons to get the total cost of gas for your trip.

Photo credit: iStock/georgeclerk

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Fixed income securities are a vital pool of investments that are an important part of investors’ strategies, whether they’re institution or individual investors. And while the public is more likely to hear about the ups and downs of the stock market on the news, the fixed income security market is worth trillions, and of vital importance to the overall financial system.

Understanding fixed income securities, and how they fit into an investing strategy, can be critical for investors of all stripes.

What are Fixed Income Securities?

To understand fixed income securities and investing in fixed income securities, it’s important to understand what “fixed income” means, and how that designation sets these financial securities apart from other investments that can be bought and sold.

“Fixed income” refers to the structure of the security itself: fixed income securities like bonds return a preset payment that legally can not change, known as the interest, and also the principal, which is returned at a set time in the future, known as “maturity.”

And like other types of securities, they have their upsides and downsides, and potentially, a place in an investor’s portfolio. With that in mind, too, it can be a good idea for investors to know how to buy bonds.


💡 Quick Tip: Look for an online brokerage with low trading commissions as well as no account minimum. Higher fees can cut into investment returns over time.

Pros and Cons of Fixed Income Securities

Here’s a quick rundown of the advantages and disadvantages of fixed income securities for investors.

Pros of Fixed Income Securities

Perhaps the biggest advantage of fixed income securities is that they are relatively low-risk, and experience less price volatility compared to equities. They can also offer more or less guaranteed returns through regular interest payments (stocks, by comparison, offer no such guarantees other than perhaps dividends), and some of them may offer tax benefits or advantages, too.

Cons of Fixed Income Securities

Fixed income securities can have their downsides, too. For most investors, there are lower potential returns to be derived from fixed income securities (lower risk and lower returns). Given that they tend to be less volatile, too, there can be fewer opportunities to sell them for a sizable return. They can also be subject to things like interest rate risks, which may not apply to other types of securities.

How Fixed Income Securities Differ from Other Securities

The payments (dividends, potentially) from a fixed-income security, like a bond, are likely known in advance. Investors know what they’re getting, in other words, and can more or less depend on a fixed income stream. The trade-off, though, is that many of those same securities do not typically have the same potential for price appreciation as stocks, as discussed.

It’s worth noting, too, that some bonds are “callable” (versus non-callable). Callable bonds can be riskier for some investors as the issuer can “call” it, requiring an investor to perhaps reinvest their money at a different rate. So, in that sense, callable bonds may not be quite as “fixed” as they seem.

Utilizing Bonds as a Fixed Income Security

Bonds are the heavy hitters of the fixed income world. Bonds are, in effect, investments in the debt of a government or a corporation, or sometimes consumer debts like mortgages or auto loans.

Think of bonds vs. stocks like this: Because of their predictable yield, bonds are generally more low-risk than stocks, which have a value that can fluctuate minute to minute.

There are a few different types of bonds, each of which have their own unique attributes. It’s also worth noting that some bonds can be “callable” — meaning, the issuer can choose to repay investors the face value of the bond before the maturity date arrives. In those cases, interest is not always guaranteed.

Corporate bonds

There are trillions of dollars worth of corporate bonds outstanding that run the gamut from very safe, low-yield bonds issued by huge companies to the riskier, higher-yield bonds, issued by companies whose prospects for future earnings are more uncertain.

High-yield bonds used to be called “junk bonds.” These are bonds issued to fund companies that often don’t have long track records of steady profits or have fallen on tough times recently and thus have to pay more for the privilege of borrowing money.

While these bonds are considerably more risky than bonds in the so-called “blue chip” market, they also provide more opportunities for profits, both because their value tends to sway and that they have higher coupon payments.

Typically the easiest way for an individual or retail investor to invest in corporate bonds is to use an investment product like an exchange-traded fund, what’s known as a “fixed income” or bond ETF, specifically for bonds.

Know, too, that there are a multitude of investment funds on the market, many of which may include or use bond investments.

Government bonds

While the corporate bond market is almost unfathomably big, it’s actually a smaller portion of the world of bonds. Government bonds are issued by governments or public agencies that issue debt to fund their activities, and pay it off with either tax payments or a stream of fees that governments have special access to.

Whenever you hear about the “national debt” of a country, you’re hearing about a set of outstanding bonds that a country uses to cover the gap between taxes and spending. This concerns the federal government in the U.S. There’s also debt issued by states and local governments, some of which offers tax advantages for investors, and debt issued by government-affiliated agencies, like Fannie Mae and Freddie Mac, the two housing finance corporations.

Debt issued by the federal government tends to have the lowest possible yield of any debt for its duration (meaning the time during which an investor gets the coupon payments), because it’s assumed by the market to be risk-free. (Think government savings bonds.) This is why corporations or institutional investors with a large amount of cash will sometimes buy government debt in order to earn something back but not risk their overall investment, compared to keeping it in cash.


💡 Quick Tip: Investment fees are assessed in different ways, including trading costs, account management fees, and possibly broker commissions. When you set up an investment account, be sure to get the exact breakdown of your “all-in costs” so you know what you’re paying.

Similar Investments to Fixed Income Securities

While bonds do most of the heavy lifting in the fixed income securities world, they’re not the only types of investments that behave in roughly the same way, or which can be used by investors to provide the same type of service in a portfolio. Here are some examples.

Dividend-paying or Preferred stocks

Preferred stocks may have fixed payouts like a bond and are given a “preference” over common stock, meaning that before dividends are paid to common stockholders, they need to be paid to preferred stockholders. Preferred stockholders are also prioritized when a company liquidates or goes out of business — the “senior debt,” aka bondholders, get paid out first, then the preferred stockholders, and finally the common stockholders get paid last.

Money market funds

Money market mutual funds are invested in short-term instruments, and investors can use them as a sort of buoy to try and maintain portfolio stability. These accounts typically invest in short-term debt investments that provide low yield but are low-risk as well. One way to think of a money market mutual fund is as a fixed income investment product that you can always sell out of and into at a stable price.

They can be used in a similar way to checking accounts but do not have the type of Federal Deposit Insurance Corporation (FDIC) insurance that bank products will have.

Certificates of Deposit (CDs)

One of the most well-known types of fixed income security, Certificates of deposit (CDs) may not seem like a “security” at all and are typically purchased through a bank, not a broker.

Unlike a bank account, however, CDs cannot be accessed for a set amount of time, which makes them more similar to traditional fixed income investments. Likewise, with a CD an investor gets a contractually obligated stream of payments that is predetermined when they purchase the security. It may be worth reading up the differences in bonds vs. CDs.

One unusual aspect of CDs is that they’re insured by the FDIC for up to $250,000, which can be attractive to some investors. They’re generally low-risk investments, too — but that lower risk tends to come with correspondingly low interest rates, making CDs a savings product more than an investment one.

Investing with SoFi

Fixed income securities like bonds, preferred stocks, money market accounts, and CDs offer steady payments and little to no income fluctuation. But with that low level of risk comes a generally low level of payoff. For investors who like knowing exactly what they’re getting, fixed income securities can be an asset to a portfolio.

The potential downside of investing in fixed income securities is lower potential returns, which may turn many investors off of them. However, depending on your investment strategy, they may play a huge role in your portfolio, too.

Ready to invest in your goals? It’s easy to get started when you open an investment account with SoFi Invest. You can invest in stocks, exchange-traded funds (ETFs), mutual funds, alternative funds, and more. SoFi doesn’t charge commissions, but other fees apply (full fee disclosure here).

FAQ

Are fixed income securities debt or equity?

Fixed income securities are typically debt securities, which includes assets like bonds. Though they can sometimes be equities, like preferred stocks.

What are the risks of investing in fixed income securities?

The primary risks of investing in fixed income securities are increased chances for lower returns compared to other asset types, and risks associated with interest rate changes.

What is the difference between a bond and fixed income securities?

A bond is a type of fixed income security, so there isn’t really a difference – one is an umbrella term over the other.

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