Gas Price Relief: Potential Government Stimulus Payments Explained

Gas prices have been soaring -- will the government step in?

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Key points

• Gas prices have risen sharply since the start of the Ukraine conflict.
• Now, lawmakers are discussing a stimulus payment to help consumers cover their gas costs.

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It's hardly a secret that inflation has caused the general cost of living to soar. But while consumers are grappling with sky-high costs across the board, they're especially feeling the pain at the pump.

Ever since the start of the Ukraine crisis, the cost of gas has risen substantially. That's squeezing a lot of consumers who were already struggling to make ends meet.

Read more: Could Your Tax Refund Save You From Inflation?

But soon, help in covering the cost of gas may be on the way. And it could spare many consumers a world of financial stress.

Could a new stimulus program be forthcoming?

In 2020 and 2021, lawmakers sent three separate rounds of stimulus payments to Americans' bank accounts, and those checks served as a lifeline at a time when the economy was sluggish. Now, a group of Congressional Democrats is proposing a new stimulus bill designed to help Americans cover the rising cost of gas.

Dubbed the Gas Rebate Act of 2022, the bill is calling for an energy rebate worth $100 per person, per month in 2022 for any month in which the national average cost per gallon exceeds $4. The bill also calls for an additional $100 per dependent -- so a family of four might be in line for $400.

To be clear, not everyone would be eligible for an energy rebate. Rather, eligibility would mimic that of the most recent stimulus check round.

As such, single tax-filers earning less than $75,000 would be eligible for a full $100 gas stimulus, and that payment would phase out at earnings of $80,000. For joint filers, those earning less than $150,000 would get the full $100 gas stimulus, and that payment would phase out at earnings of $160,000.

So far, there's little information as to how the payments would actually go out. To be fair, there's also a strong chance that this energy rebate will not come to be.

Lawmakers have been hesitant to dish out stimulus aid in light of an improved economy. So they may not be so eager to send out an energy rebate, even with today's high gas costs.

How to cope with rising gas prices

If you're having a hard time covering your gas costs, it could pay to make some changes to the way you drive. That could mean planning out your errands more strategically. Maybe you could put together a carpool with your colleagues, so you can split the cost of getting to and from work.

It also pays to make sure you're paying for gas with a credit card that offers a generous amount of cash back. Some cards, for example, offer 3% back at the pump, so if yours only offers 1%, you may want to consider applying for a new card.

Unfortunately, we could be in for many more months of ultra-high gas costs. And despite lawmakers' efforts, we can't count on a stimulus payment to help offset those costs. The best most consumers can do, therefore, is be strategic about how they drive and aim to eke out as much savings as possible by using the right credit cards.