Many people succumb to the appeal of renting which allows consumers to make smaller monthly payments instead of paying a large lump sum. Sometimes renting makes sense but other times it’s a money trap. To help you decide when to rent, MSN Money has put together a list of things you should and should never rent. The list, inside…
You should rent:
5. Pickup trucks
Unless you frequently need to haul stuff, you might be better off renting a pickup for the occasional load and driving a car with good gas mileage on a daily basis.
4. Vacation homes
Owning 2 homes is often more than twice the cost of owning one. People often underestimate the cost of insuring and maintaining a mostly unused home.
3. Anything you use once a year or less
Floor buffers, power washers and expensive power tools can be cost effective if renting. Another idea is to go in 50/50 with a neighbor on infrequently used equipment.
2. DVDs
Unless you repeatedly watch the same movies over and over, it makes more sense to rent. If you haven’t heard about Netflix by now, it’s time to check them out.
1. The next car you plan to buy
If the rental agency offers the particular car, it is a good way to get a feel for a potential new car without the pressure of the salesman.
You should never rent:
5. Wheel Rims
Being a player can be expensive especially since the least expensive rims cost $1000 and up. Rent-A-Center will rent you VCT Grissini wheels for $62 dollars a week for 12 months. However, at this rate you end up paying twice as much as they are actually worth.
4. Furniture
Renting furniture can quickly put you in the red. You can easily spend 100% more than the furniture is actually worth if you rent-to-own. You are much better off by checking out Craig’s List or a thrift store.
3. Computers
Unless you are running a small business, renting computers is usually a bad idea. For example Rent-A-Center offers a Dell system for $39.99 a week for 62 weeks totaling $2,479 while the cash price is about $1,100.
2. Televisions
At Rent-A-Center, a 50 inch Toshiba rents for $34.99 a week for 116 weeks totaling $4,000 while the cash price is only $1,200
1. Your Paycheck
Payday lenders loan you cash for a fee. For example, you may be charged $45 to cash a $300 dollar check. This works out to an effective APR of over 400%. If you fail to pay back the loan, even more fees are added leaving you buried.
As a rule of thumb, rent-to-own stores rarely ever make financial sense. These stores profit on people who don’t have enough money at the moment but feel they cannot live without certain luxury items. Even carrying a credit card balance for a few months on purchased items is ideal compared to rent-to-own. However, as we see in the list, sometimes renting does make sense, but you can rest assured you will never see such items in a rent-to-own store.
5 things you should never rent [MSN Money]
(Photo: Getty)
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Did you ever wonder why Rent-A-Center and the check cashing places are always in the crappiest part of town? If you did, you probably figured out that both of these places use a business plan that depends on people living beyond their means. Thanks, marketing guys.
OH I also wanted to mention that if you can often get a better selection of rental options if you rent from a dealership. The dealership near me will pretty much rent you anything in their lineup except expensive halo cars. It may cost a little more, but if it saves you from buying a car you end up hating, it’s a win.
Proof that the Louisiana edumacational system doesn’t teach math: 18 months ago, wheel rental places were popping up every other week in north Baton Rouge. No insurance available and a $1000.00 deposit.
If you’ve ever seen how cheaply most wheels over 18″ are constructed and how bad the streets are in virtually every corner of Louisiana, you’d know what a sucker’s bet this is.
@spoco: People driving $40000 BMWs and paying for food with food stamps.
You must mean south California. In the southeast United States, people just steal their food.
@spoco: Why work when you have people in congress fighting for your ability to stay home and collect unemployment/welfare
I haven’t seen it for a few months, but for a while there was a minivan in my neighborhood with spinning rims. The possibility that they may have been *rented* rims makes my brain hurt.
@Bladefist:
exactly. don’t get me started.
@spoco: But i want to get you started. I got paid today. I just saw huge % of my money go out the door to programs, I’ll never use, and worse, I don’t support. Lets get rev’d up!
@Greeper: “I’m surprised they didn’t include Storage in the “never rent” category.”
Probably because lots of people use storage for good reasons and it is a “definitely rent” in those cases. For example, my husband and I made a complicated series of four moves in a row while he was leaving a job in one state, I was finishing law school in a second, we were taking two bar exams in a third, and moving to the new job location else where in state #3. We pitched everything in storage progressively as we moved out (and were able to stay in a smaller place for the first part), and then lived out of suitcases and crashed with family for a few months. SOOOOO much easier and cheaper than renting somewhere for a few months and trying to fit all our furniture in a tiny place.
You might also be renting storage because you’re working out-of-state for the summer, or a college student going elsewhere for a semester or summer, or working overseas for two years and renting out your house while you’re gone … there are plenty of excellent reasons to rent storage, so it’s not a “never rent.”
@Bladefist: Another insight from the “poor people are just lazy” Republican.
@Bladefist:
My thought is that anyone who is able-bodied and takes a handout from the government has some serious issues. There are enough jobs out there for everyone and then some.
@CaliforniaCajun: No. Like spoco just said, able bodied. You missing legs? you missing legit mental facilities to provide for your family? I have no beef from you.
You full physical and mental abilities, and you live in my middle class neighborhood, on welfare, then we’z has a problem.
Poor people aren’t lazy. Actually, a lot of the people who have ‘poor’ jobs work a lot harder then most of us. People who use the system, those are the people I don’t like supporting. Maybe you don’t know any who do. I know of some.
You’re just another pity-me democrat. You know, if they got out and worked, their quality life would be better, they would have more pride. I’m all about empowering the people. If you don’t need welfare, you’re running amuck on our economy, you’re causing the need for higher taxes on the working, that includes the working poor. ah u got me started. Forget it. Go pity everyone.
@MameDennis: I’ve seen a decked-out brand new Dodge Caravan with rims. It was black with all kinds of chrome. That thing was f-ing badass! When I have kids, that will totally be my wheels.
IN THE SOUTH:
boiled peanut/Indian river fruit- 1,000,000 shops
Florida T-shirts(when not even in that state) 5 for $10 100,000 shops
Waffle house/krystal 10,000 shops
@Bladefist: I agree with you in principle but in reality the system makes it hard for those that needed help for awhile to get off the help, they get addicted and there is no easy path to recovery if you will.
I am all about providing a safety net for those that need temporary help but we also need to provide some sort of gradual re-entry program for them as well, not just taking everything away as soon as they get a minimum wage paying job, that encourages them to stay in the safety net longer then they need.
Safety net good, dependence on the system bad.
The south is a weird weird place….
And equally as bad as those who take advantage of the system are private businesses like Rent-a-Centers and payday lenders that prey on the poor.
My mistake – I am in management at a convention center. Aaron’s Rent to Own had their annual convention here last year and their big pet peeve was being called Rent to Own. Their new term is “Lease Ownership” and I have noticed that it is now popping up on their trucks.
@homerjay:
if I placed you in my middle class neighborhood in my middle class suburb, you wouldn’t know that you were in the South. 15 miles each way are like two different countries. 15 miles south and you are in the run down city where you see the $500 cars with the $2000 rims. 15 miles north is the rural area where you see the welfare fraud at its finest.
@Greeper: I understand the junk argument for storage, it’s probably not cost effective. But what about something like a motorcycle, or a jetski, etc if you live in a major city. Things that can easily be stored in small self storage for $30 a month or whatever. To say it’s not cost effective to store anything is a bit of a stretch.
@Bladefist: I also assume you are against corporate welfare for able bodied corporations, like the oil industry, farm industry, and any other company doing well but still receiving subsidies (corporate handouts) and huge tax breaks.
I learned my lesson on the furniture thing, after several months of renting, I simply bought some cheap stuff outright. Best damn decision I ever made, unfortunately I’m still trying to pay off some of the debt from the bad decision that preceeded it.
@Eyebrows McGee: Whether you rent storage in a storage facility, as a larger apartment than you would otherwise rent, or as a larger house (with its larger mortgage) than you would otherwise buy, it’s still renting storage. Even if you build a shed on your property, you still have to figure the cost of it over its lifetime, including depreciation, as a cost of storage. I don’t see the big beef about storage really.
@battra92: “I agree with the pickup truck angle.”
Not to mention how many people will ask to borrow it. (Having owned one is also why I now rent one instead of asking my friend.) On the other hand, it is a good way to meet people.
If you plan ahead, renting a pick-up shouldn’t cost more than $50 a day. Whenever I need to move something big, I go to U Haul (for a big moving truck) and they quote me a price, and I just walk out laughing my ass off. Heck, would you rather pay $800 to move 300 miles or $100 and take two trips in a pick up truck?
@jscott73: Just remember the great maxim that should be stamped on the foreheads of all who work in welfare: You get what you pay for. If you reward shiftlessness and stupidity with money, then it simply encourages people to act shiftless and to do stupid things.
I’m not against charity. I’m against handouts. I’d be for a welfare system structured something like this: Say, for example, the truly needy (sick, children, and so forth) were assured coverage of a decent level of basic necessities. Anyone able to work (including senior citizens able to hold a job) would have to have a written plan for getting self-sufficient within, say, six months to a year. The plan could include milestones for getting a job, housing, transportation, and so forth. The caseworkers should work with them and with other community agencies to identify other ways the client can stay on target. Falling behind the plan without a good reason, or failure to follow up on progress with the caseworker, might be grounds for termination of benefits.
Renting rims is expensive, but you can offset the cost by getting your car wrapped in advertising. I kid you not – if you’re down in Gulfport, Mississippi, you’re bound to spot one of the three Candy Cars: the red Skittles Cadillac, the orange Reese’s Cadillac, and the brown Twix Buick. They all have dark tinted windows and large chrome wheels, and they’re driven by fine young gents in baggy clothes with the shiniest grills you ever seen!
@Kurtz: Oh, that’s just scary. But, it does make good financial sense, if you can stomach riding around in a rolling billboard. I wonder if the sponsors chip in on gas, too…
@Homer: No, We’re just so so much prettier in the South and you know it.
@jscott73: sure am!
Really welfare is hard to debate about. Lots of emotions involved, lots of different scenarios. Tons of scenarios makes making better laws impossible.
In the end, I just think people on welfare, be it temporary or perm, cannot have a better lifestyle then people who work. And you know it happens. There are miners out there living worse lifestyles then people on full welfare. That’s wrong.
@Ariel.Sanders: No, We’re just so so much prettier in the South and you know it.
I’d agree with that. Southern Belles have that cute accent that Massachusetts gals just lack.
camera lens: If I like it, I’ll buy it, but renting it for a weekend for $20 is a great deal
Crazy idea here, instead of renting movies, go to your library, you’re already paying for it and the more you use it the more funding they’ll be able to get to expand their selection for you.
@RoboSheep: Whoa, keep your crazy ideas to yourself
This is a rent vs buy debate, not a rent vs buy vs borrow debate, that is just craaazy.
The what you should rent is useful advice, but the second part is just kinda dumb. The whole business model of rent-a center is to rip you off, so you can replace the whole list with “anything at a rent-to-own store”.
Seriously, they’re down there with check cashing places in terms of scamminess.
@WhirlyBird:
Granted, but it’s still hilariously expensive considering any bank, credit union, or thrift institution will cash your check for $0 if you have an account there.
I know a guy with a Nissan Titan (a supertruck, so to speak) which he bought because he was doing a lot of landscaping work. But the trucks cab is so gigantic that the truck bed is smushed down, the end result being that his wifes minivan, with the seats taken out, has considerably more cargo space than his truck, so that is what they use to haul things. He still drives the truck everywhere, presumably because 13 MPG is awesome for him, but he just never uses it for, like, truck stuff. He’s an idiot. With compensation issues.
@l951b951:
[www.ezrims4rent.com]
@Ariel.Sanders: Well…. you’re tanner.
Just to jump into the welfare debate:
I work in an urban area, one of the worst cities in the country (formerly the worst for violent crime) due to poverty; in the 60s and 70s, factories pulled out of the city and crime went up, so the middle class ran and things just spiraled downward.
Yet, in my job working with such people, I’ll tell you what I see.
I see people missing arms, people with broken backs, people with mental retardation and autism, and other people who would qualify for welfare bust their arses at jobs. I see people who come from foreign countries illegally work crappy jobs that are almost abusive, not because they can’t get handouts (trust me, they could easily get false documents around here) but because they want to work. There are people that come to me and they are thousands of dollars behind in child support, but they’ll pay $10 or $5, whatever they can scrape up in change, to pay the bills.
I work with a paranoid schizophrenic whose disorder is prominent even with her various medications. She’s also diabetic and severely overweight. She has trouble walking. Until a few years ago when things got worse, she didn’t miss one day of work in 27 years. Now she works a 4 day work week and is getting ready to retire on a tidy middle class pension.
I also see welfare cases. Often, not always, not even most of the time, but often, their disability is drug use. Or their disability is a criminal record. Or their disability is chronic pregnancy. Unlike people missing limbs or severely disabled, a lot of people simply do not want to work. Maybe they’re disheartened because they come from poverty and had a rough time of it in school, but they’re able bodied and they don’t want to work. The government started giving them money for their first child or because they had a temporary injury (broken wrist is one example) on the job and got a taste of that sweet welfare cash.
There are also a lot of people on SSD/welfare because of very debilitating illnesses. MS and severe Lymes that went untreated until it was too late are too big ones around here. I see people who can’t make child support payments because they’re dying of AIDS and get SSD/welfare money. People paralyzed in accidents. Etc. But these people are the ones who want to work, who are depressed because they can’t work. These are the people I’d gladly give money to.
But that should be my choice, where my money goes and who to give it to, because I hate to see the professional baby farms get the cash. God only knows they get enough from state and federal funds as well as the baby daddies. Hell, one was industrious enough to keep residencies in two states and file for each child support case in a different county so that she’d get the maximum of all her benefits. Probably lives rather well with what children she has that CPS hasn’t taken away from her.
The only thing I really disagree with are DVD’s, and that’s largely because my tastes are specific, and I tend to only buy ones that are either uncommon or rare, and stuff I will treasure and watch repeatedly- not just any ole flick.
It gets worst when it comes to HD; on top of that,[and I know I sound like an ass/snob] I’ll only buy it in bluray if it’s a movie that’s cinematography warrants the step up.
When I had just graduated from college and moved cross-country, renting furniture for a few months was the only feasible option, so I would not call it “never rent.” For about $80 a month, I was able to fully furnish my apartment (including full bed set, living room, dining tabless, etc). If I had outright bought all that stuff as soon as I arrived in town, I would have had to drop $500-800 at the minimum.
After a few months I did return the rented furniture and bought some cheap stuff, but I didn’t have that kind of cash to drop all at once on furnishing my first place like that. And, having just graduated from college, I only had $500 in total credit lines available to me.
Hookers… Rent or buy? Discuss…
If it floats, flies, or f***s, you should rent as opposed to buy.
I’m not sure why I’m posting about welfare in a rent/buy post but there is a perfectly good reason for permanent welfare as they have found out in Europe: not enough jobs. If you mechanize industry and increase productivity there simply isn’t anything to do for everyone. One solution is realize that Utopia is now and reduce the work day to a couple of hours, and allow people to live their lives outside of work; the other is to train fewer people to work more hours, and create a permanent underclass. You can try cutting off welfare, but the underclass have to exist somehow. They will start stealing your stuff unless you put them in prison (expensive) or kill them (line them up to save money).
What would have been on this list a few (10) years ago?
Telephone
But who rents their phone any more? I think there’s probably still some people out there who just pay the monthly bill and never look at it.
Gas furnace.
We had a “lease” on an in-room gas heater from the gas company, and as it turned out, it had already been full depreciated it had been there so long. I found out that we could ‘buy’ it for $2.00 and save the $10.00/month lease fee. Of course, if it broke we’d be on the hook for it, but it was a rental house. However, the gas bill came to the renter, so I wasn’t about to keep paying the lease.
The next car you plan to buy
I actually did this, it wasn’t a cheap thing to do but on a vacation out to las vegas I rented the car I had my eye on through hertz’s prestige collection. That one-day rental cost just about 50% as my current monthly lease payments. But overall was totally a worthwile thing to do. I don’t think I would ever buy/lease a car without being able to take the car on a nice long salesmen-free drive.
I remember seeing one of those wheel rental cash advance place commercials in Virginia and thinking it was an SNL skit or something. Seriously..if you’re financially strapped, DON’T BLOW MONEY ON STUPID SHIT. I guess Whoopie Goldberg disagrees with me though…since wheels are an important part of the culture of the “deep south.”
@jchennav:
Not sure about flying… when I got my pilot’s license, we ended up buying a used Skyhawk….3 months and 120+ hours later, we sold it for roughly the same. Even once you factor in maintenance, insurance, taxes, etc…the cost per hour came out to about half as much as the rental rate!
@captadam:
The Cobalt, at least, seemed better than the Ford Fusion, which was the other car in its rental class. The Fusion was the only compact model available when we rented from Hertz at PDX recently.
Wheels are strange, in the South. Sure, you see those spinning silver rims, and gigantic 30-inch tires on the 1973 Chevy Impala low-rider, but there are just as many folks driving old beaters around with mis-matched hubcaps, or no wheel cover at all. I noticed a new Cadillac at the grocery store yesterday, and the wheel-cover was nearly non-existent. You could see the brake and pads from the outside! Crazy.
I think my parents would disagree disagree with the vacation home one. My parents bought a beach house for cheap when I was younger, and now it accounts for about 2/3 of their total wealth. They rent it out over the summer so it’s basically paid for itself.
Seriously, how small must your penis be if you need to rent (or have, for that matter) rims?
Shiny compensation.
@Tmoney02: Ditto. My wife and I make our every month and a half Costco runs easily with a Mazda3 hatchback. I don’t make many impulse buys for large TVs, patio furniture (we don’t have a patio anyway!), etc., so its a non-issue anyway. *IF* I do need to haul something large, I politely ask my father in law if I can borrow his truck and/or trailer that I can pull behind our Wrangler (which hasn’t seen much use in the past two months with gas as high as it has been) for the occasional hauling trip.
Most of the trucks that people claim they “have” to have are so shiny that I doubt they’ve seen more than picking up some small loads of lumber or have made an occasional run to the county landfill. If you’re REALLY using a truck for stuff around the house on a regular basis, it’ll show it. My dad’s trucks, even those purchased new, only maintained that new look for maybe two years, before the dirt accumulated in the bed, scratches appeared on the tailgate and bedrails and a permanent accumulation of dirt appeared in the wheel wells. Somehow, he’s always managed to get by with smaller trucks too…like F-100/150s and Rangers. Yet you get these guys buying F-250s to pull a 20 ft camper (saw that plenty of times last week at the Grand Canyon) and make the occasional run to Lowes. I just don’t get it.