Could Situational Car Rental Instead of Ownership Save You Money?

by Gina Blitstein · 0 comments

Despite the popular myth that most Americans own a own car, it’s common for urban residents to be non-car owners. With the convenience and affordability of mass transit in large metropolitan areas, it’s not surprising that city-dwellers choose to let someone else do the driving the majority of the time. When they need automotive transportation, urban dwellers do what many people do only when they travel: They rent.

It’s becoming more common, however, for residents of other-than-urban areas to forego buying and rent a car when needed, thereby incurring a car expense only when they need wheels.

Consider these scenarios to determine whether renting a car may be a cost-effective option for you:

Temporary ride – When there are multiple drivers in one family, there may not always be enough cars to go around. Even in multi-car households, temporary or short-term situations could arise when another car is necessary. Another car payment may be deemed unrealistic and unnecessary but renting a car for those particular occasions may prove to be the perfect solution.

Try before you buy – Test drives answer a few initial questions about a vehicle but renting a model for several days or weeks can give you decision-making experience with a car. Things like seat comfort may not be easily determined during a half-hour test-drive. By renting the car, you’ll have the opportunity to experience driving it in a variety of situations and locations, e.g. city, highway or long distance driving, providing intel that will help you make an informed purchase.

The right vehicle for the situation – You may need a sedan that seats the family and handles well in inclement weather most of the time, so that’s what you own. But maybe you’re planning a second honeymoon cross-country trip during the summer and would prefer driving a two-seater convertible. Renting a SUV might be appropriate for taking the kids and their friends skiing. Renting a vehicle you want or need situationally is the practical solution.

Avoiding car ownership expense – For some people, incurring the expenses associated with owning a car is simply not practical. Those expenses include its initial cost (which, for many people translates to a monthly car payment for a number of years), auto insurance, license and registration, maintenance and repair, and possibly even parking/storage fees. If these costs exceed the cost of renting a car situationally (and you have reliable alternatives available for emergencies) renting may be something to investigate in the interest of saving money.

If you do decide that car ownership is something you can forego, it’s important to still take the issue of auto insurance into consideration. While it’s true that you don’t need auto insurance when you don’t own a car, if you frequently rent or borrow vehicles, you may want to look into “non-owners car insurance.” This type of policy provides additional liability insurance to protect your assets from being at risk in the event that damages caused by your accident exceed the liability limits of the rental policy or that of the owner of the vehicle. Non-owner car insurance policies generally cost about half the premium of a standard car-owner policy.

In a country where it seems that car ownership is more a “right” than either a necessity or convenience, the concept of non-ownership can seem foreign. There’s no escaping the fact, however, that owning a car is an expensive proposition. It’s an interesting exercise to really assess the cost vs benefit of car ownership. Renting is an option that could, in some situations, prove financially wise.

Could situational car rental (as opposed to ownership) work for you?

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