If you don't shop around ahead of time, you may realize you are seriously overpaying for your car rental, financial adviser Ray Martin reports on The Early Show.
Millions of U.S. vacationers rent vehicles at airports to get around the cities they are visiting. City dwellers who don't own a car often rent one for weekend getaways. Still, renting a car isn't something you do frequently and, if you don't pay attention, you'll pay too much, get stuck with extra fees or worse, owe thousands in damages caused by you or someone else.
To be sure, there are lots of choices: Hertz, Avis, National, Enterprise, Budget and Dollar are just a few. With all the competition, prices for a given make and model can vary widely.
Where you rent has as much to do with the price as what you rent, according to Runzeheimer International, a Wisconsin-based publisher of The Guide to Daily Travel Prices. Its survey found the most expensive locations include Cleveland, New York City and Newark, N.J. The least expensive cities include Honolulu, Fort Lauderdale and Sioux Falls, S. D.
Apparently, the local mass transit prices have a lot to do with rental car prices. The rental companies know what travelers usually don't: the taxi and parking fees at your destination.
When looking for a rental deal, you have two options: Use the toll-free central reservation number or use the Internet. Most cars are rented through phone services, but some recent "secret shopping" surveys indicate you may not be fully informed about all fees, discounts and charges.
In some cases, smart shoppers will find discounts on the Internet and all disclosures are there in black-and-white to read. Whatever route you take, here are the things you should know before you rent a car:
- Comparison shop. Prices among the major companies in the same area can vary as much as 25 percent. Be careful to ask about availability; some companies can be short on local supply and pull a last-minute switch to a vehicle less to your liking. Also, compare prices online versus the phone reservation centers. Some companies will offer the same prices; some will provide discounts if you do the shopping and reservations on their Web site.
- Get discounts. Almost anyone can get something knocked off the standard prices. The key is that you must ask. Discounts of 5 to 15 percent are offered with memberships in popular groups such as AAA, AARP, Costco, and Sam's Club and even through certain credit cards.
- Ask about upgrades. Ask about upgrading the size of your car. Occasionally, you may get this for free, or for as little as an additional $1 to $2 a day.
- Buy insurance wisely. Car renters will gladly sell you additional personal accident, personl effects, collision-damage and loss-damage waiver coverage. Most individuals who have auto, homeowners or renters insurance may already have this coverage. Credit cards used to charge car rentals may do the same. It's advisable to call your insurance agent and credit card companies to be sure the coverage you already have adequately protects you. This is particularly important when it comes to the cost of settling personal injury or property damage claims.
The laws vary by state and even by counties within a state, sometimes holding renters liable for every dollar spent by the rental company on these claims. Even if the accident was not your fault, in some locations a car rental company can settle a personal injury suit and obtain full reimbursement from you.
- Taxes and surcharges. These run an additional 10 percent and include charges such as airport fees, surcharges towards local projects such as convention centers and parking taxes. The extras can be stated as a percentage of the rental fee or in a flat dollar amounts.
- Vehicle registration, recovery and drop-off. This always sets me off when I see this fee charged by some car rental companies. I'm the one returning the car and the cost of registering it should be built into the rental fees. The fact is that some stick this 3.5 percent charge to renters and some do not, so shop around.
- Age-related surcharges. Drivers under 25 will pay more and have fewer choices in what they can rent. Most states require drivers to be at least 21 to rent a car, so it's not an option for many college students. The surcharges for these drivers can be steep - an extra $20 to $80 a day. There are no reports of a maximum age for drivers in the U.S.
- Second driver fees. These fees can range from $4 to $25 a day and can add up for couples who travel together and share a rented car.
- Late-return fees. This is where you can really get stung. Return a car an hour late and you can get charged by the hour or for a full additional day. Avoiding this is simple enough: Stick to your travel plans and return your car on time.
- Gas fill-up charges. Bring the car back with a partial tank of gas and you'll pay dearly. Car rental companies will fill your tank for you for as much as double the cost of local gas prices. Alternatively, they'll offer a fuel-purchase option, where they'll charge you for the full tank of gas when you pick up the rental. This is a good deal for the car rental company, as they know most cars are returned with some gas in the tank and therefore they get to resell the same gas to another customer. Making a stop at a local gas station and filling up before you return the car will avoid this extra charge.