So you’ve been clipping coupons, you bought that 35 mpg Ford Focus, you’ve lived frugally and now you’re faced with $7/gallon for gas. What next? What’s your game plan for $7/gallon gas?

How much more time and energy will you spend trying to cut corners so you can buy a gallon of gas?

I’ve been having some rather interesting and disturbing discussions with associates, family members and friends and most of them are hurting or know of people who are hurting. I was driving over an overpass recently overlooking a CarMax lot and was shocked to see the lot full of SUVs: Suburbans, Expeditions, etc were parked in the grass because the paved lot was full!

I bring this up because I’ve been catching up on some analysts reports that project oil to be around $200/barrel within a couple of years. There are solid analysts who’ve been in the industry for decades and not your typical CNBC jar-heads that haven’t done their homework.

The obvious antidote to the poison of high fuel prices is greater income and NOW is the time to position yourself to handle the increase.

I’d suggest:

Refresh your education – get that certification, go back for that professional training, finish that degree or get another one.

Prepare your employer for the upcoming pay increase you’re expecting because of high energy prices. Don’t wait till late 2009 to tell your employer you need a raise, start telling him/her NOW that you’re worried about $7/gallon gas and you’ll need a big raise to compensate you. Giving your boss more time NOW will allow him/her to work with the executive management group to start preparing for dramatic increase in salary requests.

Prepare yourself to potentially move to a new employer near your home. At $7/gallon gas, it becomes difficult to justify driving 40 miles for a job that pays $20/hour on that gas guzzling 10 mpg SUV. Selling your old home might be a problem in today’s real estate market which is why you should start NOW.

Adjust your portfolio. As ironic as this sounds, high gas/oil will lead to a lower stock market and this is the time to INCREASE your savings and contributions to the stock market when things turn sour, you’ll be getting in at a big discount. Unfortunately, high gas prices will likely mean you’ll have less cash on hand and that’s the irony.

Have a second stream of income. Whether you start blogging about your belly aching high gas prices or you start selling tamales on the side, you’ll need a second income stream.

Hedge your expenses. If gas hits $7/gallon then it might be worth it to invest in UGA as a hedge.