I’ve been traveling more lately. Each time that the trip involves flying and a rental car, I have to go through the gauntlet of financially stupid offers. Some of these offers just plain rip-offs, and some are just stupid.
Bad Airline Offers
The airline business is very competitive. They are trying everything they can to get you to fly with them rather than their competitor. Some of the airlines lure you in with low prices only to charge extra for each bag you check. For some airlines, it feels like the transaction is more about how they can get your money rather than how much value they can provide to you.
We certainly have to be careful to understand all the fees and charges when we pay for airfare. Here some stupid airlines offers that you should avoid.
1. Upgrade to first class
Prior to my most recent trip I kept getting emails from the airline telling me I only had X weeks left to upgrade to first class. “Hurry Now! before it’s too late.” Flying business class, or first class is always a luxury. In every case I’ve experienced, coach, business class, and first class all arrive at the same destination at the same time.
Remember your trip is about what’s happening at the destination. You didn’t schedule the trip for the airplane ride.
2. Credit card offers
On many flights, there are offers to sign up for a credit card. You get some number of air miles added to your account just for signing up. On a recent trip I took, it was very much in-your-face credit card advertising. The airline stewardess even walked down the aisle with the application in hand.
I know many people will disagree with me here, but here’s why this is bad for you. You’re making a decision to borrow money based purely on the rewards. There’s no consideration of the interest rate (they don’t even mention it.) And there’s no consideration or plan for how the card will be used.
What typically happens is the use of the credit card (to get more airline miles) ends up messing up your ability to stay in control of your money. The money spent and the bills are separated in time by about a month, making the sense that you are spending your money almost non-existent. Answering the question, “Can I afford this?” almost becomes an unanswerable question.
Don’t let the lure of a free flight suck you into a financial mess.
Bad Rental Car Offers
These days the rental car business seems worse than the airlines in terms of the type and number of bad offers they provide.
1. Upgrade your car
I was in line at the rental car place, and I was watching the interactions with one of the clerks and a customer. I feel sorry for that poor customer. The clerk was running full steam ahead with a hard sales pitch about why the guy needed to upgrade to an SUV.
When you’re on a trip, all you need for a vehicle is a reliable set of 4 wheels and a steering wheel. Unless you really are going to be in the vehicle for hours, just about any car will be sufficient and will get you where you need to go.
Just like the flight upgrade, you probably didn’t plan your trip so you can drive around in a rental car. So, don’t waste money renting a luxury car.
2. Rental Car Insurance
I’m guessing that you don’t buy two insurance policies for your own car so that you can place claims on one and avoid increasing the cost of the other. You would be paying twice as much in car insurance than you need to. But this is what the rental car salesman suggests you do. The price is astronomically high too. You pay around $10-$15/day for the insurance. If you multiplied that out, the annual rate is $3,000-$5,000 per year. That’s the most expensive car insurance anywhere.
Unless you’re in a unique circumstance, just about any car insurance policy you have will cover rental car incidents. Don’t pay extra for the rental car insurance. It’s a rip-off.
3. Prepaid Gas
Prepaid gas at the rental car counter is just a pure rip-off. There’s no other way to describe it. They will quote you this price per gallon that looks cheaper than the going rate at the pumps. You think “Sure, I’ll pay now. I hedge against the prices going up, and I don’t have to stop at the station before I return my car.” So, you prepay for a tank or half a tank of gas.
What they don’t tell you is that they charge for the same number of gallons no matter what type of car you rent. I prepaid for the 1/2 tank of gas once and was charged more money than it costs me to completely fill up my Jeep at home which holds 18 gallons. By the price I paid, I’m guessing that I paid for about 20 gallons of gas for that “half tank”. I looked it up, That rental economy car I had only holds 11 gallons.
Just stay away from prepaid gas. It’s a rip-off.
What about you? What bad deals have you encountered when travelling?