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Advice & More August 2012

Dollar Sense

Renting a Car for Your Summer Travel? Tips for Saving $$ and Avoiding Problems

By Teresa Ambord

Don’t assume you will be told about all available discounts. Ask. And while you are asking, be sure you are made aware of all restrictions. For example, it may be cheaper to rent for a week than for two or three days. Ask!

You may be an old pro when it comes to dealing with renting a car. But for many, it can be confusing. Like most industries, car rental companies have terminology of their own. Those terms may change the way their fees are calculated, so you need to know what they mean. If you are not familiar with the terminology and common practices, you could end up spending much more than you should.

Points You Should Know Before You Rent

  • If you have some flexibility in your plans, ask the agent when the best price breaks are. You may see an advertised special that looks good, but be sure you know when the blackout dates are, and what restrictions and conditions apply.
  • Decide in advance how much car you really need and how much you are willing to spend. Otherwise you may feel pressured to make a rush decision when talking to an agent. Be sure you know how a car size is defined with the company you are considering. Is a compact car more likely to be the size of a Chevy Cavalier, or a Geo Metro? How does this company define “luxury car?”
  • Get a good estimate of your mileage needs ahead of time, and find out if the deal you are getting limits your mileage. Leave plenty of room for error so you don’t end up paying overages. Mileage fees are usually assessed on a cents-per-mile basis or as a flat fee when you exceed the allotted miles.
  • Don’t assume you will be told about all available discounts. Ask. And while you are asking, be sure you are made aware of all restrictions. For example, it may be cheaper to rent for a week than for two or three days. Ask!
  • If you need the car only for 24 hours you may be required to pay for two full days of rent. Ask!
  • Be sure you get a definite time and date when the car must be returned to avoid extra charges, and ask if there is a penalty for returning the car early.
  • Be clear on the fueling policy. For example, are you better off filling the gas tank down the street rather than letting the rental company fill it? Policies vary.
  • Find out what additional fees could pump up the price, such as deposits, fuel charges, airport surcharges, drop-off fees, additional driver fees, underage fees, taxes, equipment charges (such as for car seats or luggage racks).
  • Rental car insurance can be puzzling. You can buy insurance from the company, but you may already have such coverage on your auto and homeowner policies. If you have medical insurance, it likely covers any medical attention you will need, but if you aren't certain, ask your insurer.

The rental company will offer what is known as CDW or Collision Damage Waiver. This is an optional fee of $9 to $13 per day, according to the Federal Trade Commission (FTC). CDW is not technically collision insurance. It is a guarantee that the rental company will pay for damages to the car you rent. If you decline the coverage, you are accepting responsibility. Do not rent until you have contacted your insurer to find out what your existing policies will cover.

  • If you're traveling on business, find out if your employer already has you covered before you pay for coverage you don't need.
  • If you're a member of a motor club, like AAA or, depending on which credit card you use to pay for the rental car, you may have free protection through them.
  • Finally, before you drive away, have a rental agent employee go with you to look over the car for existing scratches and dents.

Will You End Up Hitchhiking?

Maybe. The FTC warns that if your driving record is questionable, you may not be able to rent a car. The rental company will take your reservation, and they most likely will check your driving record. But the record check may come after the reservation is made, and after you left home and boarded a plane. If time is short, you may arrive at your destination and be denied a car, so be sure to book your car rental early enough that you can check to make sure your driving record won’t leave you hitchhiking.

If you have rented a car and suspect you have been treated unfairly, you can visit the FTC at, for information, or call 1-877-FTC-HELP.


Teresa Ambord is a former accountant and Enrolled Agent with the IRS. Now she writes full time from her home, mostly for business, and about family when the inspiration strikes.

Meet Teresa