Everyday Cheapskate: Your Very Own Hedge Fund
Several years ago, when gas prices were at their highest in Los Angeles, I paid $4.26 a gallon -- $102 to fill my Chevy Silverado.
As I write, at $1.97 a gallon, the cost for a full tank of regular-grade gasoline for my truck has plummeted by half to $48.
Regardless of where you live, it's likely that you're experiencing and enjoying the same thing -- cheap gas. You're saving a ton off the peak prices of past summers.
It's so easy to ignore it, though, and let that "saved" money stay in your bank account, where it will inevitably be spent on something useless -- or just evaporate unnoticed, the way money in a checking account has a way of doing.
However, the truth remains: Because fuel prices have dropped dramatically, all of us are spending a lot less on gasoline compared with what we were spending a year or so ago.
Now is the time, before you get too comfortable with the cheap prices, to create an automatic transfer of the money you're not spending on gas into a special account to protect you when the prices go higher. You cannot predict what prices will do, but you can get prepared.
Call it your hedge fund -- a term that describes an investment position intended to offset potential losses/gains in the future. That's what big-shot investors do; they hedge against future losses. So can you. Here's a painless way to do it.
NO. 1: OPEN AN ACCOUNT
Set up an online savings account at SmartyPig (my favorite) or Capital One 360 Performance Savings. You want an online account that has no fees, no minimums, is Federal Deposit Insurance Corporation-insured and allows you to set up automatic transfers.
NO. 2: DETERMINE THE AMOUNT