Renting a car for a trip makes financial sense

Dear Car Talk:

My husband always talks about how taking a long vacation by car puts too much wear and tear on a car. He thinks renting a car (at least $25 per day in our area) makes better financial sense. I think that is crazy. What are cars for if not to drive and enjoy? The type of trip I am talking about is from Dallas all the way up the coast of California and back, over about three weeks. Who is right here? — Jan


Dear Jan:

I know this is hard to believe, but your husband may be right.

Take a look at the math. The first thing you need to do is figure out the “cost” of taking your own car. The best estimate comes from our pals at the Internal Revenue Service, who have determined that the use of a personal car for a business purpose is worth 57.5 cents per mile. That factors in things such as gas, oil, tires, wear and tear, the money it costs you to “own” the car for that mile, insurance and depreciation.

So if we map out a trip from Dallas to San Francisco, that’s about 1,700 miles each way, or 3,400 miles round-trip. At the IRS rate, the cost to use your own car for that trip would be $1,955.

Let’s compare the rental option. Assuming you can rent a car with unlimited mileage for $25 a day, your three-week rental will cost you $525. Of course, the advertised price of a rental car doesn’t include a bunch of fees they always charge, so let’s say it’s $35 a day. Then your cost for 21 days is $735. Maybe you can do better, but let’s use that number.

Now, that’s not your only cost in renting the car. While you don’t have to pay for maintenance, repairs or insurance (if you have comprehensive insurance on your personal vehicle, it almost always covers a rental car), you do have to pay for your own gas.

So if we assume that you get a combined 20 miles per gallon in your rental car, you’ll need 170 gallons of gas for that trip, and at 3 bucks a gallon, that’s another $510.

So you can see that, based on our simple calculation, the total cost of your rental car is $1,245, and the cost of driving your own car is $1,955.

Now, I say “simple” because, while you’re out running Hertz’s newest Mustang into the ground, you’ll still be paying your car loan while your car rests comfortably in your garage. So you may want to add three weeks of your monthly payment — since you’ll have to pay it, even if your car is at home. But I think the rental still will come out ahead.

And here’s the real advantage of a rental car: It’ll be a newer car, so it’ll be unlikely to break down. But if for some reason it does sputter off the road on a highway near Fresno, you just call the rental car company, and they’ll give you another car. No triptus interruptus. No trying to figure out if Rocko from Roadside Rocko’s Repair Refuge is right that you really do need a new $4,000 transmission while you’re wasting your vacation at the Bates Motel next door.

Even more important, when you’re on a road trip for three weeks, you’re often eating and drinking in the car. And if you’re going to spill something with steamed milk onto an absorbent car seat, you’ll want it to be someone else’s. It’ll be a great feeling to be pulling into that “rental car return” lane before it really starts to stink. Good luck, Jan. Have a great trip.

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