rent

Should You Rent or Buy a Car?

January 25, 2016 By Alexa Mason 2 Comments

Buying a second car can be a stressful and costly task. However, depending on your reasoning for needing a second car, renting a car from a rental company may be better than buying another car. Of course, a rental car is never truly yours, but how often do you really use that second car anyway? Here are a few things to consider when you are wondering whether you should buy a second car or rent.

Do You Need a Car?

Do you really need that second car? Some people like the convenience of having a second car, but if you’re not going to be using it every single day, then it goes to waste. If you want a second car for occasional errands or trips, you’re better off renting a car instead of buying a second one. There’s no need to spend the money on a second car if you don’t truly need it every day.

Lowered Insurance Costs

Depending on the insurance plan you have for your first car, you might be covered if you rent a second car. Some insurance plans make you register a second car, which drives up your yearly rate. However, some insurance plans cover a rental car under the original plan. Additionally, most credit card companies also cover car insurance on rental cars. By renting a second car, you’re saving money that you might have spent insuring another car.

Maintenance Costs on a New Car

Depending where you rent your car, the rental car agency might cover any maintenance costs. Maintaining a car is very expensive, especially if your car is prone to breaking down or needing new parts. If you’re already paying for the upkeep on one car, why pay for a second? If you decide to rent, make sure you rent from an agency or dealer that cover the cost of maintenance. It could save you hundreds or thousands of dollars.

The Fuel Costs With a New Car

Many rental agencies only have newer car models. While a used car might seem like a good second option to buy, you’re going to be paying a lot of gas. Most newer car models are fuel efficient. So renting a newer car with a better gas mileage is a great benefit. No one likes paying for gas, especially when it seems to be rising higher and higher each year. So why wouldn’t you choose to rent a cheaper, newer car that has better fuel efficiency?

Free Gas With Rental Cars

If you’re only using your second car temporarily, renting might be the better option, especially if you rent from a company that offers free gas. For instance, when you rent a car from ZipCar, the cost of gas is included in the price. So, if you’re renting a car for $8 an hour for half the day, you don’t need to worry about how far you’re driving or how much you’ll need to budget for gas. All you have to do is use their prepaid gas card and you’re good to go.

Change Your Car With Rental Company

Depending on the car rental agency or your contract with them, renting a second car instead of buying one might allow you the opportunity to change car styles. Say you need to rent a sedan for a family trip one month, but you need a truck for a construction project the next month. By renting a car, you’re able to make that change. Buying a second car means you’re stuck with that model and might be forced to temporarily rent an additional vehicle to suit your needs. Renting affords more opportunity and is more beneficial for those with ever changing lifestyles.

Renting is Flexible

If you sign a one or two year rental agreement, you have the flexibility to use a different car once the rental agreement expires. If you buy a car, especially if you buy it under a loan, you’re stuck with it until you finish paying it off. Some people buy second cars and then decide a year later that they don’t actually need them. With a rental car, if you don’t need that second car, you won’t be stuck paying for it after your agreement is up.

Rental Cars Can Be More Cost Effective

Renting a car might be more cost effective overall, and you probably won’t have to take out a loan to afford it. If you were thinking of refinancing or taking out a loan to pay for a second car, you’re heading for financial trouble. Shop around and see what car rental agencies offer in terms of price. You might find that the prices are reasonable, and then you won’t have to consider the loan you would have taken out to purchase that second car.

Upfront Cost is Lower With Rental

By renting a second car, you’ll end up paying less money upfront. If you decide to buy a new car – or even a used car from a dealership – you generally have to pay a large down payment. With a rental car, your down payment will be significantly less since you’re not permanently purchasing it. Additionally, your monthly fees will be less than if you had bought the car.

Business Cars Can Be Tax Deductible

If you’re thinking of buying a second car for business reasons, renting one will allow you to claim it as a business expense. Buying a car would be considered owning an asset and as the years go by, the asset depreciates in value, meaning less money for the owner.

Photo: Flickr: Atomic Taco

Try Before You Buy

September 14, 2012 By Jennifer Derrick Leave a Comment

Over the years, I’ve made many purchases that I wouldn’t have made if I’d just tired the item before I bought it. Sometimes the item hasn’t lived up to my expectations (video games that turn out not to be fun or challenging, for example) or it’s had unexpected downsides (the refrigerator that was incredibly loud). Whatever the reason, I kick myself because I know that if I’d just tried it first, I wouldn’t have wasted the money.

In this day and age, there are more ways than ever to actually try a product before you buy it. The bigger the purchase, the more important it is to try it before you plunk down the money. Many retailers are so desperate to compete for your business that they will help you test out even the most cumbersome appliance or tool. Sometimes you have to be brave enough to ask, but if they want your money they’ll find a way to help you. Here are some ways that you can try almost anything before you commit to buying it.

Rent It

You can rent tools, appliances, video games, movies, and many other things. For a small fee, you can try out the item, see how you like it and then decide whether or not to invest in one of your own.

Borrow It

If someone you know has the movie, game, CD, electronic gizmo, or tool that you’re thinking about getting, see if you can borrow theirs for a few days. Try it out and see if it’s really what you want. (Just be sure to return it in the same condition, or offer to pay for any dings you put in it.)

Join A Group

Sometimes you can join a club or group that will let you try things you’re interested in. I belong to a board gaming group and I get to try a lot of games that other people bring to the table. You may be able to find a movie or video game group or other hobby organization where members will bring in their items and let you try them.

Play With The Demo

Many video games offer demo versions online that you can play and see if you like it. Stores put out demo models of appliance’s, TV’s, computers, etc. so you can play with them and see how they work. If you can find a demo model of your item, by all means play with it. If a demo model isn’t out and you think it would help you decide, ask the store manager if you can take one out of the box and play with it. Many times the manager will agree.

Play/Read The Samples

Many books on Amazon have the “See Inside” feature where you can read the first few pages of the book. If you have a Kindle, you can download a sample for free. In the case of music, Amazon and iTunes have song samples available. You can also listen to songs on YouTube and see clips from TV series/movies. Take advantage of these snippets of a work to see if it’s something you like.

Free Samples/Trial Sizes

Don’t buy the biggest package of a new product. Try a small size, first. If you find someone giving out free samples in the grocery store, try that. You can find samples of perfume in magazines, and sometimes other products like dryer sheets or shampoo. Free samples of other products can also be found if you ask. If you can’t find a free sample, buy a trial size or simply the smallest package you can find. It’s better to buy a small jar of that face cream and discover you hate it than it is to sink the money into a big jar.

Try It On

Even if you’re sure something will fit, try it on anyway. Manufacturers change sizing templates all the time and what fit yesterday may not fit today. If you can, try the item on with others that it will be worn with. For example, if you’re looking for shoes, wear or bring the outfit you’re trying to match with you. You’ll be able to see how the whole thing looks together.

Watch The Videos

Sometimes you can’t find a way to try a product yourself. If you go to YouTube, though, you can probably find a video of someone else using the product and giving a review of all its features. I’ve done this with board games and my most recent cell phone purchase. I watched videos of others playing the game and describing the features of the phone and was satisfied that I would enjoy the real things.

Test Drive

You’d think that test driving a new car would be a given, but I’m always amazed by the number of people who seem to skip this step. Drive it on the highway and on residential roads to see how it handles, how it sounds, and how all the features work. When we bought our RV, the dealer allowed us to camp in it overnight on his lot before we bought it so we could spend time making sure all the appliances and systems worked. If you have the opportunity to put the item through it’s paces, take it.

Plug It In/Turn It On

You’d think that a refrigerator would be a refrigerator, or a dryer would be a dryer. But sometimes these things make a huge racket or emit weird smells. Like I said above, I once got a refrigerator that made so much noise I had to shut the bedroom door at night. It was great in all other areas, but it was too loud. Ask the salesperson if you can plug in the demo model of the appliance before you buy it. You want to turn it on and see how loud it gets. Also, ask if you can try things like vacuum cleaners. You don’t want to be surprised by something that’s too heavy for you to lift, or that doesn’t suck up dirt well.

Visit At Different Times

When house/apartment hunting, you want to visit the place at different times of the day to see how the traffic and noise are, check the sun coming in the windows, and all those other things that can be annoying. You also want to visit on a weekday and a weekend. How does traffic differ? Is parking a problem on the weekend or at night? Are kids running amok every weekend? Try to visit several times over a few days to get a feel for how life really is.

Take Advantage Of A Trial Offer

Sometimes a service provider (like a landscaper or maid) will offer a freebie so you can see how he works. Or you can try larger items like a mattress in your home for a few days/weeks before you commit to the purchase. If you can get a free trial, take advantage of it.

If possible, find some way to try a product or service before you buy it. There is very little that you have to buy totally blind. You can find a way to try almost anything. Trying before you buy can save you a lot of headache and regret later. Not to mention money.

(Photo courtesy of GoonSquadSarah)

Get More Money Without a Second Job

December 10, 2009 By Jennifer Derrick 8 Comments

When thoughts turn to getting more cash every month, many people assume that they’ll have to take a second job. That may be true. If your financial situation is dire or if you have your heart set on some big ticket item, a second job may be the only way to get to the necessary level of income. However, it is possible to bring in large sums of money without getting a second job, just by changing the way you currently live.

You can do this three ways (singly or in combination): Sell your stuff, cut your fixed expenses, and find ways to earn money that are not a “job” (online surveys, entering contests, a little freelance work, etc.). The easiest and quickest way is to cut your fixed expenses. I hear you now, “But a fixed expense is just that. Fixed. It can’t be changed so we’re stuck with it.” That’s just not true. Nothing is “fixed” in stone. Yes, getting the expense reduced may mean some time, inconvenience, or sacrifice on your part, but it is possible to reduce or eliminate every expense that you think is fixed.

If you are in a financial situation where you need a lot more money fast and you don’t want to get a second job, then reducing your fixed expenses is one avenue you need to look at. So how can you reduce those supposedly “fixed” expenses? Here are a few ideas for some common expenses:

Mortgage payments: Downsize to a smaller, less expensive house. Refinance and take advantage of lower interest rates. See if you have any extras like PMI on your mortgage and find out if you qualify to have them removed. Rent out a room and use the rent money to cover your mortgage.

Rent: Move to a different complex. Move to a smaller unit within the same complex. Take on a roommate. Ask the landlord for a reduced rate in exchange for working in the office two days a week or doing some landscaping. Ask the landlord for a reduced rate based on your status as a long term, good tenant.

Utility bills: Conserve water and energy (take shorter showers, only run full loads of laundry/dishes, stop watering the lawn, turn off lights when you leave a room, switch to CFL bulbs, etc.). Ask your energy company if they offer reduced rates for off-peak usage. Ask if they have an energy conservation discount. See if your utility will give you a discount for paperless billing. Get a programmable thermostat and have it turn your heat/AC up or down when you’re not home or asleep. Unplug anything not in use and put everything else on power strips you can flick off when you’re not using it.

Phone/Wireless/Internet: See if a bundle will lower your bills. Drop extras like call waiting, caller ID, unlimited data, text messaging, and long distance. Switch to a slower speed Internet connection. Drop the phone or Internet service altogether if you aren’t using it. Switch to prepaid cell service. Consider dropping the landline if you only use your cell phone.

TV/Cable: Switch to a lower priced package. Call your provider and ask them to match a competitor’s deal or see if they can lower your bill (many have unadvertised packages or customer retention deals they can offer if you ask). Drop the service entirely and rent movies from Netflix, Redbox, or free from the library, or watch TV shows over the Internet at sites like Hulu.com.

Car payments: Sell the expensive car and get a cheaper one. Turn in your lease and buy a beater. Get rid of one car and become a single car family. Become the carpool leader at work and use the money your riders give you to pay your car note. Sell the car and use public transit, walk, or ride a bike.

Insurance: Shop around for the best price. Drop unnecessary coverages. Ask about discounts for safety features, group memberships, taking a class, healthy living, holding more than one policy with the company, etc. Raise your deductible. Sell something (like a car, expensive jewelry, or art) to get out from under the insurance payment. Sell the expensive-to-insure car and buy one that costs far less to insure.

Taxes: Appeal if you think your property valuation is too high. Contribute to an IRA or 401K to reduce your taxable income. Take all the tax deductions you’re entitled to. Donate to charity. Move to a lower tax area or sell the house and buy a smaller one that carries less of a tax burden. Sell the new car that has a high property tax and buy one that’s worth less.

Debt payments: Ask your credit card company to reduce your interest rate. Move balances to cards that offer zero percent on balance transfers. Look into consolidating student loans. Sell the things that caused the debt (cars, electronics, “toys,” designer clothes, etc.) and use the money to pay down the debt. Negotiate with hospitals and medical providers to lower your payments.

Services: Any service that requires a monthly/annual payment can be discontinued. Alarm service, gym memberships, lawn service, maintenance contracts, subscriptions, dues, etc. can all be cancelled. Try renegotiating the rate on anything you think you must keep.

Food: Use coupons. Shop sales and stock up. Don’t eat out often. Eat less meat. Shop non-traditional markets like Aldi’s and bakery outlets that specialize in overstocks. Don’t waste food; eat it before it expires. Shop local farmer’s markets for in season produce. Buy fewer processed convenience foods and stick to more natural foods.

Fuel: Drive less. Combine errands and don’t make unnecessary trips. Trade in the large SUV for a smaller, fuel efficient car. Use sites like GasBuddy.com to find the cheapest stations. Use mass transit or walk. Start a carpool.

Fixed expenses won’t magically reduce themselves, but neither do they have to remain at their current levels. All expenses can be changed, you just have to be willing to make those changes happen. Some of those changes are hard and may seem like an inconvenience or a burden but if you need money fast and you don’t want or can’t get a second job, then you can still generate a lot of cash by drastically reducing your “fixed” expenses.

Renting Responsibly: How Not to be a Victim of Foreclosure

January 11, 2009 By Ann Hartter 4 Comments

The business section of the Denver Post included a bit about Fannie Mae signing interim rental contracts with tenants of properties their landlords couldn’t pay for. What does this tell me? A renter doesn’t know the financial position of their landlords. It used to be that was a just fine arrangement, but maybe it is time to reconsider how renter contracts are signed.

I’ve lived with two specifically rocky landlords in my life. One was plagued by having to replace the century old sewer system, and having to raise the rent. Shortly after the job was completed, the place was sold and we had to sign a new contract with the new owner. Since the excavation was occurring in our front yard, it was easy to see the potential financial blow such a project could land on our lessor, so we were relatively prepared for the hike in rent and only mildly surprised at the subsequent sale.

Two years later, we rented from an elderly couple, and the next thing we knew we were paying a property management service instead. The chatty lady behind the management desk informed me one of the previous landlords had died, and that the property was being sold to their son in a different state. The elderly couple had been more than happy to reimburse us for some improvements on the property, but their son was not. We struggled with the tagged-on management fee to the rent in addition to the cost of the repairs we had already done. We managed to move before the property was sold a second time.

Today, these scenarios are playing out across the country: sales on the horizon and financial trouble for those who own the property. Hardworking, prompt-paying renters are being dealt the shoddy hand as there are no buyers and the banks take over. Good renters with steady incomes are finding themselves struggling through no fault of their own.

While the government bailed-out institution Fannie Mae can help some people in the coming months, and Freddie Mac not far behind, what can the rest of the renting population do to ensure they aren’t standing on the soft earth above the invisible hole their landlords are digging?

Check the public records of your rental property. The county assessor’s office has records on sales price, owners, tax and purchase information. Is your rent commiserate with a mortgage beginning that sale date for that sale price? Is your rental income enough to cover property taxes, too? If not, you may not be covering the expenses of the owner.
If you have a property manager, read your lease or call to determine if the company is legally responsible to you if your lessor goes under. If they are, you may be able to rent under them if you are removed from your home due to foreclosure.
Talk to your landlord. Find out if the place you’re renting is paid off or if they’re able to manage the mortgage responsibility. Ask them to call you if there are money problems ahead that may endanger their contract with you.

If you are served with an eviction notice due to foreclosure, there are tips in the article including

Find out how long you are legally allowed to stay after notice.

Find out if the lender is willing to sign a contract, as Fannie Mae is

You have a right to know if the house you’re renting is actually available for you to rent. Just because the place is vacant and someone is willing to sign a contract with you and take your money does not mean that you have a place to live. Being a good tenant is not just about being good to your landlord by paying rent on time, it also means you are good to yourself and your family by making sure there is a solid roof over your head.