Kimiko Kidd
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Hidden Costs of Car Rental

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While car rentals can be incredibly convenient, this handy service can have hidden fees, making your trip more expensive than you bargained for. When you look for a rental, it can be easy to think that you’ll only be paying the price you see on the company’s website. However, even if you’re the most judicious driver you will likely to pay some hidden fees. Don’t get hit with sticker shock — here’s a look at what you could be charged for, and how to avoid unnecessary charges when possible.


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Basic fees and expenses

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Let’s start with the obvious ones. These aren’t really hidden charges, but they are worth keeping in mind.

  • Sales tax: As with most goods and services you purchase, sales tax will be added on to your car rental rates.
  • Gas: If you don’t fill the gas tank before returning the vehicle, the rental car company will most likely charge a significant price to do it themselves. Some rental companies give you the chance to pre-pay your fuel, but this is often costlier than simply refilling the tank yourself before you return the rental.
  • Insurance: Buying insurance through the rental company is optional, and you’re likely already covered through your personal auto policy or credit card. Double-check with the staff to make sure that you’re not purchasing unneeded coverage.

Beyond those charges, which most of us already know about, there are several other charges that can catch you off guard.

Other fees to consider

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  • Authorization hold: Typically, your rental agency will warn you of this one. Whether the staff notifies you or not, it’s important to know that many rental companies will “hold” an extra few hundred dollars on your credit or debit card on top of the rental fee price, then credit the money back to you when you hand over the keys. They do this to secure funds for damage you may cause while driving the car. However, this can be particularly annoying since you may not have planned for an extra $200 in your account to suddenly be unavailable, especially while travelling.
  • Additional extras: Satellite radio and GPS may make your road trip easier, but you’ll likely be charged extra for a vehicle with these amenities. Instead of using in-vehicle tech tools, consider loading your phone with relevant navigation info, as well as playlists, audiobooks, and podcasts to keep you entertained on the road.
  • Charges for damage: It’s important to note and document any and all damage to the rental car before driving off the rental car lot. You could be charged for even the smallest dents or scratches if they aren’t on record as pre-existing. Save yourself any hassle by doing a thorough inspection and photographing the vehicle with your phone prior to departing the lot.
  • Cancellation fees: If you make a rental car reservation and then cancel it, you’ll likely be charged a fee – often around $10. Even worse, if you don’t cancel and don’t show up, expect to pay around $50.
  • Extra day charges: Typically, rental cars operate on a 24-hour schedule. If you pick up a vehicle at 5:00 p.m., but return it at 6:00 p.m. on the day it’s due back, you’ll be charged for an extra day. Try to factor this in when you decide to pick up your vehicle — you may not want the pressure of rushing back to the car rental company before 8:00 a.m. on a Monday.
  • Returning the car at a different location: If you plan to rent a car at one location, and return it to a different location, this will incur additional charges.
  • Upgrade charges: When you show up to pick up your rental, you may not feel penalized when you’re presented with an upgraded model. However, that step up will probably come with a price. It’s a good idea to inquire about any increased fees and associated charges. For instance, if you have to purchase insurance for the vehicle, you will be charged more to insure a fancier vehicle. However, it’s ultimately up to you whether or not to go with the upgraded model. You can also ask to see what other vehicles the rental agency has available — you could opt for a cheaper model instead of a pricier one.
  • Highway tolls: If your route takes you through toll roads, be aware that you’ll be charged for going through an electronic toll transponder lane. It’s easy to slip through one of these gates without even realizing it. Typically, the rental company will charge you an “administrative fee” on top of the price you’d normally pay to drive on the toll road. According to Consumer Reports, even if you rack up a toll that’s less than $1, you may still get stuck paying an administrative fee of $15. Luckily, there are a few ways to avoid this charge. If your route takes you to a toll road, make sure you go through a lane where you physically pay the toll, instead of letting the transponder take care of it. And of course, you can always plot a route that avoids toll roads altogether.
  • Higher costs for airport rentals: This should generally be reflected in your daily rate, but rental car companies usually have to pay a concession fee to the airport in order to operate near it. These fees are usually passed along to the customer, and most are willing to pay it in exchange for the convenience associated with an airport pickup. It might be worth looking into daily rates for companies in town, especially if you plan to rent the car for a long period of time.
  • Under 25 penalty: It wasn’t long ago that you couldn’t even rent a car if you were under 25 years old. Nowadays, most companies allow anyone over 21 to rent a car but will slap a big fee on the bill.
  • Extra Driver: If you plan to have anyone besides yourself driving the car, you’ll have to pay a fee. This one’s not worth fibbing about, because if you get into an accident when a non-authorized driver is driving, you might not be covered under insurance. In other words, you could be out a significant amount of money. However, you can shop around to avoid this fee, because some companies will waive this fee — especially if the other driver is the primary driver’s spouse.

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Want to learn more about renting vehicles? Check out our post on when you should say no to a rental car.