You’ve heard of renting a car or bike, or even textbooks for that matter. However, renting just about anything seems to be gaining popularity. Need a fancy dress for an event? Why buy a new gown when you can rent one and the jewelry and handbag to go with it for a fraction of the price? Working on a weekend DIY project but don’t have room for that industrial-size saw in your garage? Rent one for just the amount of time you need it!
But it doesn’t end there. You can find websites dedicated to loaning out everything from pets for a day (hey, you might be out of town and lonely) to (gasp) a casket (only if the person is cremated, of course).
However, you may be wondering if it makes financial sense to spend on temporary in lieu of permanent, because that can add up too, right?
When it comes to weighing the pros and cons of renting an item or service versus purchasing it outright, consider the 3 C’s:
There are two parts to this: First, you have to compare the monetary difference of owning and renting. Second, you have to determine your cost-per-use when justifying your decision.
Imagine you’re going to buy a camera. Write down all of the things that would cost you money upfront, as well as all the costs that would go into maintaining it in optimum condition. For example, if you want to invest in a professional camera, there’s more than just the cost of the camera body – you may need additional lenses, a tripod, a protective carrying case and additional accessories that can definitely take a toll on your wallet.
Once you have your dollar amount, estimate how many times you will use your purchase. Is it daily? Once per month? Special occasions only? Divide that number into the cost, and you’ll uncover your cost-per-use.
Now, do the same exercise, but use the rental figures instead. Don’t forget to include any deposits, insurance, shipping/handling fees or damage fees that may be required.
Compare your cost-per-use of owning with the cost-per-use of renting to determine which one makes financial sense for you.
If renting still seems appealing, is it also convenient? Do you have to travel far to obtain what you need? If the item is being shipped to you and you need it by a specific date, will it get there on time? Will a customer service representative be available if you have a question or an issue? What are their hours? If you want to rent a pet for a 7:00 p.m. walk, but the pet rental place closes at 5:00 p.m., that’s hardly convenient.
Know the terms and conditions under which you’re renting. Read the fine print – there may be significant costs involved if damage is incurred while the item is in your care. Some companies offer an insurance fee you can pay in advance to protect you. When it’s time to return your rental, are you responsible for shipping fees or insuring the item to make sure it gets back safely? Does it need to be postmarked or arrive by a specific date or time? Are there penalty fees if there’s a delay?
For items that you use on a regular basis, perhaps owning the item will make the most sense for you. However, equipment for a special project or clothing for an annual event may make renting a cost-effective and maintenance-free alternative for your budget.
What have you rented before? Why did it make sense for you to rent instead of buy? Share with us in the comments below!