Take a Taxi or Rent a Car? Which is More Cost Efficient? - Quicken Loans Zing BlogI’m not very good at sticking within a budget. That point becomes even more clear when I’m on vacation. While I at least try to limit the amount of money I spend in my everyday life, it seems like nothing is out of the question when it comes to vacation. I go out to eat two or three times a day, go on day-long cruises and spend money buying as many t-shirts and souvenirs as possible. It’s like I completely forget that I’m on a limited budget.

Whenever I begin planning a vacation, I tend to only think about how nice it’ll be to get away and hang out at the beach. Instead of thinking about how nice it would be to have some money saved up, all my attention is focused on how much fun I’ll have. From there, it’s all downhill. Do I have fun? Yes, but it comes with a cost.

One of those costs is due to transportation. For the last two years, whenever I’ve taken a vacation, I’ve decided to take taxis instead of paying for a rental car. You may think I’m crazy, but let me give you a little background information. Until this past September, I was under the age of 25. When it comes to renting a car, 25 is the magic number.

The magic number for what, you ask? To rent a car at a reasonable price. Until recently (within the last 10 years), you weren’t even allowed to rent a car until you were 25. Since then, the laws have changed. While drivers under the age of 25 can now legally rent a car at most companies, they’ll find the price is considerably more expensive.

It’s kind of like paying for insurance. Teen drivers are more at risk for accidents, therefore they pay more for car insurance. It’s the same for renting a car. Statistics show that people under the age of 25 are still more at risk than people aged 25 and over.

What about after you turn 25? What’s the difference in cost between renting a car and taking a taxi? Let’s take a look.

When I take a vacation in Florida, I always stay at my family’s condo. It’s located about eight miles from the beach. A round-trip taxi ride from the condo to the beach costs about $60. I know, I know. That’s a lot of money to drive less than 20 miles. However, when you consider that drivers under the age of 25 who rent a car are often charged an additional fee of $60–$90 a day, taking a taxi may actually save money.

For example, say you’re 23 years old, and you need to rent a car for six days. For those six days, you’re looking at a fee close to $200 for a basic car. The initial $200 isn’t bad, right? However, once you start tacking on all the additional costs, you’ll likely change your mind. Let’s say the company you rent from charges an “underage” fee of $70 a day. For six days, you’re looking at an additional $420, making your total come to $620 before taxes. Don’t forget about filling up the gas tank and rental insurance, if necessary.

On the other hand, you could take a taxi and pay $60 a day. For six days, you’ll pay a total of $360, which comes out to $260 less than you’d pay for a car rental. It’s important to remember that the taxi ride only gets you to and from the beach. It doesn’t include any additional trips you may want to take. Since I spend all my days at the beach, taking a taxi wins every time.

It’s also important to take into consideration where you’re traveling. If you’re like me, you’re terrible with directions. You know left from right but that’s about it. If helplessly driving around doesn’t sound like a good way to spend your vacation, I’d recommend taking a taxi. You’ll get to and from your destination in no time, and you won’t have to worry about getting lost.

Another often overlooked detail is parking. If you’re staying in a big city, there’s a good chance you’ll have to pay for daily parking. The first time I traveled to Chicago, I had no idea what to expect. I arrived at my hotel only to find out the hotel had no parking lot. It was up to the customer to find their own parking, or pay $50 a day to park at a garage located a few blocks away. Parking costs can increase the cost of a rental car tremendously, so be sure to check ahead.

A week from today, I’ll be back in Florida on the beach. Even though I’m 25 now, I still opted to ditch the rental car and take a taxi. It also doesn’t hurt that I’ll be with a friend so we can split the cost each day.

What do YOU think? When it comes to deciding between renting a car and taking a taxi, what do you think is the most cost-efficient method? Let us know in the comments section below!

 

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This Post Has 13 Comments

  1. I didn’t know you needed to be over 25 to rent a car. I guess agencies don’t have that rule anymore. I’m flying into Vegas and considering getting a rental.

    1. Hi John:

      Traditionally, most car rental companies will require you to be 25 years of age or older in order to rent a car, but some will still rent to you at 20-years-old as long as you have a valid driver’s license and a credit card that’s in the driver’s name. However, the car rental company may require an additional daily fee if you are under 25 years of age. Hope this helps!

  2. Car rental has become an option which has been utilised by more and more users frequently. I prefer to rent a car then to take a cab, due to the fact that renting a car provides me with the option of freedom of movement, whereas when you take a taxi the driver will drop you at a certain location. Due to intense competition among various providers, you get the best deals and a wide range of cars to travel into. With car rental service you can visit some of the most remote locations, which is something that taxi’s won’t offer you. Lastly, it offers luxury and comfort as you can rent cars like Mercedes and BMW, unlike a taxi service which have their conventional vehicles with zero comfort. There are a number of rent-a-car services, but the one I recently used and was quite pleased with the service was EZ Trans Express, there service was splendid and took me to all the location I wanted to.

  3. Without regrets, hiring a taxi is fantastic. I was also having this sort of conversation with my friends about the regret of spending several thousands of dollars owning my own car rather than hiring a taxi or leasing a car. Perfect blog post. I go for a taxi hire, it’s as simple as that.

  4. I love riding in cabs, and every time I go somewhere like New York, I always go and ride on them. The only downside I see with cabs and taxi’s is the cost. Taxi’s are not cheap, and I prefer paying for the rental car transfer services rather than the fare for a cab.

  5. I read few posts on this website and I conceive that your post is very clear and has sets of fantastic information.

  6. I am really impressed to see this useful post. We need some more good information. You are doing great job and keep it up.

  7. I prefer to hire a taxi as it is more reliable when going somewhere . I believe that it has more benefits as we dont have to drive and we dont get tired.

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