海角大神

As you鈥檙e undoubtedly aware, gas prices are spiking 鈥� again. And as always happens when gas prices spike, the media will soon begin gushing tired and obvious advice on ways to save.

I鈥檝e been watching, and participating in, this well-worn parade of stories for more than 20 years. But no more. Because while the advice offered is largely sound, it misses the point entirely. Here鈥檚 the point: When it comes to gas prices, even the feared $5 gas level, if you can鈥檛 beat 鈥榚m (you can鈥檛), join 鈥榚m (you can).

By way of illustration, here鈥檚 an article I wrote the last time gas prices spiked. It was published on Dec. 8, 2010. I reprint it here exactly as it was written. Check it out, then I鈥檒l give you a short update鈥�

28 Ways to Save on Gas You Already Know 鈥� And Maybe One You Don鈥檛 (see below)

The last time you were at the pump, you probably noticed the price of gas is creeping skyward. According to the American Automobile Association (AAA), a gallon of unleaded is now averaging $2.95: up 10 percent in the last year and nearly 4 percent in just the last month.

Get used to the idea. As the world economy improves, rising world demand for oil, coupled with a weak dollar, virtually guarantees higher prices. Oil yesterday broke the $90/barrel barrier 鈥� the highest it鈥檚 been since 2008. And some experts are predicting $100/barrel won鈥檛 be far behind.

Just as predictable as higher prices at the pump are the plethora of articles you鈥檒l soon start seeing offering advice to save on gas. As you did the last time prices spiked, you鈥檒l see ideas like 鈥渟hop around,鈥� 鈥渟low down,鈥� or 鈥渦se a gas聽credit card聽that offers rebates.鈥� If they sound familiar, that鈥檚 because you got them in 2008.

Last week SmartMoney published an article called聽3 New Ways to Save on Gas. But I guess they don鈥檛 read their own work, because one of their 鈥渘ew鈥� ideas (buying gas from a warehouse club like聽Sam鈥檚,聽Costco聽or聽BJ鈥檚) was in an article from June 17, 2009, called聽7 Ways to Save on Gas.

To save you from having to surf the web for obvious advice, here鈥檚 a condensed version recently culled from popular personal finance sites. After you check these out, I鈥檒l tell you the best way to deal with higher gas prices 鈥� really.

The 28 ways to save on gas you already know

1. Pay cash聽(If you get a discount for it 鈥� which is rare indeed)
2. Fill up at the warehouse club聽(I know 鈥� you told me: twice)
3. Shop around聽(You mean some places have lower prices than others? I never knew that!)
4. Slow down聽(Oh, is that how that works? The slower you go, the less gas you use? Thanks.)
5. Take the extra weight out of your car聽(Good advice 鈥� that鈥檚 why we gave it years ago.)
6. Get a tune-up聽(See above)
7. Get a gas rewards card聽(See above)
8. Get a tire alignment聽(See above)
9. Clean your air filters聽(See above)
10. Check your tire pressure聽(See above)
11. Eliminate jack-rabbit starts聽(You mean to save gas, I shouldn鈥檛 stomp on the pedal?)
12. 颁补谤辫辞辞濒听(this came from an article called聽8 New Ways to Save on Gas聽from U.S. News & World Report in 2008 鈥� but believe it or not, I suggested every one of these tips in a TV news story聽in 1991)
13. Ride a bike聽(Great idea 鈥� unless it鈥檚 4 degrees outside or I鈥檓 taking my girlfriend with me)
14. Buy a car that gets better mileage聽(Spend $25,000 to save $5 a month 鈥� how ingenious!)
15. Use a smart phone app to find nearby low prices聽(This is a good idea 鈥� that鈥檚 why we suggested it in 2008)
16. Brake the right way聽(Meaning as little as possible. Here鈥檚 an idea: how about disconnecting the brakes entirely!)
17. Turn off your air conditioner聽(You turn off your air conditioner 鈥� I live in Florida)
18. Close your windows聽(They are closed: My air conditioner is on)
19. Pick a better route聽(Really? I try to find the longest, most indirect route possible whenever I drive)
20. Combine trips聽(Good common sense 鈥� which is why we already knew it)
21. Ride the slipstream聽(better yet 鈥� drive onto a car-carrier at a truck stop)
22. Target the best time of day to get gas聽(I鈥檇 suggest when the attendant is in the restroom)
23. Don鈥檛 fill up until you鈥檙e empty聽(I guess that means I should carry a gas can in my trunk?)
24. Make sure your gas cap is tight聽(What鈥�I鈥檓 not supposed to leave it on the trunk of my car?)
25. Don鈥檛 idle聽(This suggestion was to turn off your car if you鈥檙e going to idle for more than聽30 seconds. Save $5 on gas 鈥� spend $500 on a new starter)
26. Don鈥檛 use high octane gas unless your car is pinging聽(That was good advice when I first gave it in 1991)
27. Don鈥檛 top off your tank聽(The sticker on the gas pump already told me this)
28. Watch traffic ahead of you so you can anticipate slow-downs and avoid stops聽(this is especially important if you鈥檝e disconnected your brakes)

The one way to deal with higher gas prices you might not have considered

While this way to deal with rising gas prices has probably also been written about before 鈥� everything has 鈥� I offer it nonetheless:聽Hedge against higher gas prices by owning a few shares of an oil company鈥檚 stock. Not only will your shares likely rise with rising oil and gas prices, added bonus: You might earn a higher聽interest rate聽on your savings as well.

If you check out聽my online portfolio, you鈥檒l note that I bought 300 shares of ConocoPhillips in the spring and summer of 2009 at an average price of about $37/share. So I invested about $11,000 in this stock. It鈥檚 now at about $64/share and worth about $8,000 more than I paid. Some of that 70 percent gain undoubtedly comes from the fact that the entire stock market has rebounded nicely since then: The Dow was only at about 8,000 in July of 2009 鈥� it鈥檚 37 percent higher now. But a lot of the gain is probably due to oil prices. When I bought ConocoPhillips, oil was $59 a barrel 鈥� now it鈥檚 $90.

So the gains I鈥檝e made by owning this stock have more than offset any extra money I鈥檓 paying for gas. In addition, ConocoPhillips pays a nice dividend: $2.20/share, which comes out to 3.42 percent at today鈥檚 prices. Are you earning 3.4 percent in your savings account? I鈥檓 not.

In short, owning an oil company like this one can pay in two ways: The dividend may offer a heck of a lot more interest than your bank, and the stock might be a very effective hedge against rising oil prices.

Are there drawbacks to owning shares in an oil company? Of course. First, while doing things like rolling up your windows or properly inflating your tires cost nothing, buying ConocoPhillips means coming out of pocket to the tune of $64/share. Second, as with all stocks, there are obvious risks involved. While it鈥檚 unlikely ConocoPhillips will go belly-up, I just told you it was $37 a share less than two years ago. There鈥檚 no law that says it can鈥檛 go there again. Nonetheless, if oil prices do go higher in the weeks and months ahead, it鈥檚 highly likely that owning shares in an integrated oil company will be more effective than rolling up your windows.

I鈥檓 not particularly touting one oil company over another 鈥� if you like the concept, do a little research on your own. To get you started,聽here鈥檚 the page of analysts recommendations re ConocoPhillips.

But humor me 鈥� Assume you buy a few shares of ConocoPhillips at today鈥檚 price of $64/share. If gas prices go up, see if it goes up with them.

And even if you hate my idea to defend against higher pump prices, at least give me credit for not serving up 20-year-old tips and calling them 鈥渘ew鈥�.

2012 Update

While it鈥檚 true that using some or all of those tired tips will help you save gas, when I wrote that article two years ago, gas was $2.95. Now it鈥檚 approaching $4. Use as many tricks as you want 鈥� they won鈥檛 keep you ahead of this game.

And what鈥檚 happened to ConocoPhillips?

Yesterday ConocoPhillips closed at just under $75. Which means it鈥檚 gone up $11/share, or 17 percent. It鈥檚 also increased its dividend 20 percent, from $2.20/share in 2010 to $2.64 today. Since I鈥檝e been reinvesting my dividends into more shares of stock, I now own 332 shares instead of 300, which are now worth just under $25,000, compared to my purchase price of $11,000.

Now we鈥檙e talking about keeping up.

The lesson

Personal finance isn鈥檛 about pinching pennies, it鈥檚 about becoming wealthier, or at least maintaining your current wealth. In the case of combating rising oil, while pinching pennies doesn鈥檛 hurt, it doesn鈥檛 come close to solving the problem. Nor does republishing gas saving tips from 2008 or 1991.

Want to become wealthier? Whenever you find yourself the victim of price hikes, see if there鈥檚 a way to also become a beneficiary. In this case, there is.

As I said in my 2010 post, stocks are risky. If you can鈥檛 afford the risk, don鈥檛 take it. But if you can 鈥� even if it鈥檚 just with a couple of hundred bucks 鈥� you鈥檙e potentially going to go a lot farther than you will by rolling your windows up.

Has this train left the station? If I thought so, I wouldn鈥檛 still have 25 grand in Conoco.

鈥撀燬tacy Johnson聽is a journalist, author, and executive producer and publisher of聽Money Talks News, a consumer/personal finance TV news feature that airs in about 80 cities as well as around the Web. This column first appeared in Money Talk News.