Decide: To Drive Your Own Car or Rent

It’s that time of year again. The road trip to wherever. What if you’re a mathematically-minded, budget-conscious person?

You’ve probably wondered if renting a car would be cheaper than driving your own. Wonder no more. The post below describes one approach.

I warn you though, it’s complicated. Ready? Keep reading:

First, look at how much a new version of your car would cost. Not the car or truck you want; your current vehicle. Let’s say a new version of your vehicle costs $30,000. If you wish to be more accurate (or more pessimistic), then figure out much you actually end paying. In my case, after paying the interest on the loan, the taxes, and the title fee, the final cost is often about 20% more than the listed sales prices. So, in this case, assume a total cost of $30,000 + (0.20*30,000) = $30,000 + $6,000 = $36,000 Second, look at how long cars like your last. Look up used car listings, and sort by “most miles”. You probably should exclude the extreme cases of someone driving a 1,000,000 miles by the time the vehicle is 10 years old. Once you start finding several models for sale that have 300,000 or 200,000-something miles, then you might guess that your vehicle may not last too much beyond that. Finding old vehicles with lots of miles is easy if you are looking for something like a Ford F-150 or Honda Accord. Both of these vehicle have decades of history behind them.

There is a counter-argument: There are many mechanical differences between a 20-year-old version of your vehicle and a new one. Looking at how many miles a 20-, 30-, or 40-year-old version may not apply to yours. If you have a lot of evidence for an alternative method, then use that to estimate how many miles your car will last.

What if you drive a vehicle that has no history behind it? No 20-year-old versions exist. In that case, look at analogs: similar-sized vehicles from the same manufacturer, similar technologies (hybrids, Hemis, or whatever) in different manufacturers. If all else fails, then you could ask yourself and your friends what’s most amount of miles they’ve ever seen in a car that they’ve driven themselves.

 However you find that number, let’s say that you find a couple of 25-year-old versions of your car for sale with 300,000 or so miles on them. With these two numbers ($36,000 for the cost of a new version of your vehicle, and 300,000 and the reasonable maximum that your vehicle can be driven), divide the cost by the miles. In this example, the math is $36,000 / 300,000 miles = $0.12 / mile.

Then, you have maintenance and repairs. This can be as complicated and detailed as you want. I would suggest including at least the oil changes (done every 3000 to 6000 miles), and the 15,000, 30,000, and 60,000 mile services. Your owner’s manual may have different service intervals. I recommend going up to 60,000 miles (or 5 or 6 years), but not much further, for two reasons:

1) To capture the expensive maintenance services. The recommend services to be done at 60,000 miles may cost well over $800 (as of 2019). That’s over 1 cent per mile.

2) Getting cost data for maintenance intervals beyond 60,000 miles or 5 years is tricky. Often, the maintenance recommendations have changed (or will change), compared to what is in your owner’s manual. Several years may pass before the first 100,000 or 120,000 mile interval, never mind the second 100,000 or 120,000 mile maintenance (at 200,000 and 240,000 miles respectively). Inflation will make the first 100,000 mile service look cheaper than the second time at 200,000 miles. That is, unless you are driving 30,000 miles per year.

Repairs are even more complicated. In my experience, they tend to vary between a linear and exponential increase over time. Not only that, but also they are almost random in their occurrence. It is hard to project a stable cost per mile. Repairs may cost anywhere from $500 to $10,000 per incident, and occur maybe once, twice, or four times in a year. Let’s say that after crunching numbers to your heart’s delight, you find that maintenance is about $0.06 per mile.

Did you include replacing the battery and the tires? These are “infrequent” repairs, but the cost of batteries and tires are easy to look up. Let’s say that batteries last about 5 years (or 60,000 miles) and tires last about 6 years (80,000 miles). A new battery may cost $120, and tires may cost $600. Doing the math here, that is ($120 / 60,000) + ($600 / 80,000) = $0.002 + $0.008 = $0.01 mile.

Finally, there’s gas. Gas prices fluctuate enough that you are better off waiting until your travel dates are firm before doing the math. With that in mind, let’s say that gasoline costs $2.10 per gallon, and that you get 30 miles per gallon on the highway. For the math, keep your units organized: ($2.10 / gallon) * (gallon / 30 miles) = $2.10 / 30 miles = $0.07 per mile. I’ve left off insurance and registration, since those become cheaper per mile (often) the more you drive. Whether you include them is up to you.

As of now, you have the following numbers:

Cost of vehicle (and interest and taxes) per mile = $0.12
Maintenance per mile = $0.06
Batteries and tires = $0.01
Gasoline = $0.07

The total for this example is $0.26 per mile.

If that seems cheap, it’s because I left out insurance and registration. I’ve also not included depreciation, because the mathematical model assumes that the car may be driven until it’s not longer drivable. Depreciation becomes a factor if you sell the car in a drivable condition. In that case, you estimate how much money you would get when selling the vehicle, and do the math: (Cost of purchase – sales price when you sell) / miles driven between your buying and your selling of the vehicle. By all means, if you can sell a vehicle for almost the same price that you bought it at, go for it.

Anyway, if you’re planning a 1000 mile road trip (500 miles there and 500 miles back), then the cost of driving that distance is $0.26 / miles * 1000 miles = $260.

Now, look up the cost of renting a car for that trip. Remember that most rental car companies charge by the day, not by the mile. Check to be certain. Let’s say that you found that you could rent a vehicle for $250, with unlimited miles. Does that mean that you would save money by renting?

Not necessarily. You still need to pay for gas on this 1000 mile trip. You thought this calculation was not complicated enough? You don’t really know what you’re going to get at the rental place, and the “free upgrade” may cost you at the pump.

Let’s say that you’re willing to accept a vehicle (like an SUV) that may only get 25 miles per gallon on the freeway In that case, you will need to buy (1000 miles * 1 gallon / 25 miles) = 40 gallons of gas for the trip. At $2.10 per gallon, that is $84 for the trip. Since you would spend $260 to drive a 1000 miles in your car, the rental car (or SUV) would have to cost no more than $260 - $84 (for the gas) = $176.

In summary, to know whether you should rent a vehicle vs drive your own, calculate the following costs:

Cost of vehicle (and interest and taxes) per mile = ______
Maintenance (oil changes, 15,000 mile services, etc) per mile = ______
Batteries and tires = _____
Gasoline (dollar per gallon times gallon per miles) = ____
Total cost per mile= ________
Driving distance = ________ miles
Total cost of trip = distance times cost per mile = ________

The cost of gasoline for driving the rental cal (dollar per gallon times gallon per miles times miles driven) = ______
The cost of the rental car = _______
Total cost of renting the car plus gas = _________

Renting a car is often better for long-distance trips over a short number of days. Essentially, you need to drive a certain amount of miles per day in order to make renting a car cheaper than driving your own. This applies to rental contracts with “unlimited miles.” If the car rental company charges for miles, then you need to find out how much that will cost for the entire trip.

I did not include the cost of insurance for the rental car, for the following reasons:

1) If you have collision and comprehensive insurance for your own car, then your insurance company may already cover the damage to a rental vehicle. Call your insurance company to be sure. If you don’t have collision and comprehensive, then consider getting a credit card that offers that insurance coverage as primary, not secondary. If you don’t have auto insurance at all, then you may have to buy the rental car company’s insurance, if only for the liability coverage. If you have car insurance, then call your insurance company to be sure that your liability coverage also applies to rental cars. If you have health insurance, then your health insurance company should* cover your medical costs.

*(Notwithstanding all the billing chaos that occurs with emergency medicine and out-of-network providers, etc).

Side note: Retaining collision and comprehensive may make sense if the yearly cost of the insurance (plus deductible) is less than 10% the value of your car. The idea is that if you’re in a car crash once every 10 years, then the cost of paying for your vehicle should be spread out over that 10 year period. Of course, if you’re crashing your car every five years, you are probably paying more for insurance anyway.

2) If you pay for the rental car with a credit card, then the credit card may offer collision and comprehensive insurance (but usually not liability or medical). Call to be sure. If they do offer it, then ask if it is primary (you can file with claim without going through your own auto insurance) or secondary (you need to first file a claim with your own auto insurance). If your credit card does not offer any coverage, then apply for a credit card that does have (primary) rental car coverage. The challenge there is that the credit cards that I know that offer any rental car coverage often charge an annual fee.

In summary of the insurance situation (in 2020, from my personal experience; I’m not a lawyer, insurance agent, etc. Always contact the relevant professionals for advice, etc.):

1) If you have collision and comprehensive insurance for your personal car, then call your insurance company to see if it covers rental cars. If they don't, then:

A) Find a credit card company that offers (primary, not secondary) collision and comprehensive coverage, or

B) Pay for that coverage at the rental car company.


2) If you have liability insurance for damages that you cause with your personal car, then call your insurance company to see if that applies to your driving a rental car. If they don’t, then:

A) Find an insurance company that will sell you liability insurance that would apply to you renting a car, or

B) Pay for that coverage at the rental car company.


3) If you have health insurance, then your health insurance company should* cover your medical costs.

*(Notwithstanding all the billing chaos that occurs with emergency medicine and out-of-network providers, etc).

Otherwise, you should do one or both of the following:

A) Get health insurance if you don’t already have it;

B) Find supplemental or travel insurance that covers accidents and hospital stays at your destination (and on the road).


That was a lot of information. Asking questions to your insurance and credit card companies is rarely fun. While renting a car can be cost advantageous (especially for long-distance small number-of-days trips), one accident can remove all the cost savings.