Rent a Truck vs. Buy a Truck
Today’s topic is the comparison between the benefits that come from renting a truck as opposed to buying one. Many people love their trucks. This is great, and we are not saying that you need to go out and sell one if you have it, or that you should never buy one. This post is for those people who think it would be nice to have an extra truck to haul things occasionally, and are trying to determine if it is worth it to buy one. It is our conclusion that in most cases it makes sense to just stick with the car you have, save money on gas & insurance, and help the environment by renting a truck when you need it (hopefully through this site). To bring up a specific example, we will discuss Tim’s sister and her decision three years ago to buy an extra truck. They needed to haul things from time to time, and wanted the ease of just having a truck always available. They planned to do a lot of work on their yard over the coming years, and found a good deal on a truck. But did it make sense to buy it? That’s what we will analyze here.
Cost of Owning a Truck
So let’s look at what she bought. She bought a 1997 Chevy Silverado 1500. At that time she spent about $12,000. Today that same truck is worth about $7,000. So in the last three years she has lost about $5,000 on the value of the truck. So the first cost we will list to own this truck for three years is $5,000.Cost 1 - $5,000
But what other costs has she had? Well the next most obvious one is insurance. We called her and asked what she paid in insurance every month, and she told us $40 a month, which comes out to $480 a year. Multiply that by three years and you have another $1,440 in insurance payments. That will be cost number two.
Cost 2 - $1,440
Besides these costs, let’s assume they did the recommended oil changes every 3 months or 3,000 miles. An oil change every three months over three years comes to 12 oil changes. At JiffyLube that is about $35 a pop, so at 12 times over 3 years that makes another $420. That will be cost number three.
Cost 3 - $210
Of course you need to maintain your truck, but as Tim’s sister didn’t drive it around much let’s just say she ended up spending $1,000 over three years. That is the cost to replace the tires, get new windshield wipers, replace a headlight or two, fix a couple parts, and just basically keep it in running condition. That will be cost number four, basic maintenance.
Cost 4 - $1,000
There are other costs that we will not add on, but need to be considered. How about the annoyance of having a truck sitting in your driveway for three years gathering dust & moss? The fact that you need to wash it probably once a month. The fact that you have to move it every now and then to get beneath it. Maybe it drips oil in your driveway? There is a real annoyance factor to having this truck, but since it is hard to quantify we will leave that off the cost.
So let’s add this all up.
Cost 1 - $5,000
Cost 2 - $1,440
Cost 3 - $420
Cost 4 - $1,000
Total = $7, 870 over three years.
So that is the true cost of the truck. And how much did she use it? Well the first year they used it a lot she said, as they were doing yard work. She estimated it at about 20 times. Then the next year it was used a lot less, but they let some friends use it to move a couple times, so we will say it was used 10 times. This last year they have probably used it twice, so their usage has really tapered off. That is a total of 32 uses over 3 years. I rounded it up to 36 trips to make it an even once a month. That is approximately $218 per use of the truck!
Cost of Renting a Truck
So how much does it cost to rent a truck? We checked on U-Haul and it was $19.95 a day plus mileage. So let’s say you spend another $40 in mileage (which is a lot more than normal). We left the gas out because you would be paying it either way. Adding those costs it totals $60 a day to rent a truck from U-Haul. That means that Tim’s sister paid about $180 more per trip by buying a truck than she would have spent on U-Haul! Yikes!
So let’s see what this would have cost Tim’s sister over the course of three years if she had rented every time, and this includes lending it to her friends. Again we rounded up the number of trips to 36 to make it an even once a month for three years.
Cost Per Day - $60
Total Number of Trips – 36
Total Cost = $60 * 36 = $2160 or let’s just say ~ $2200
Over the course of three years that comes to a total difference of about $5,500 that she spent to have a truck sitting in her driveway 365 days of the year. That is a steep price to pay for convenience.
But maybe she is a bad example? How about if you planned to use the truck two times per month? Ignoring the facts that this may increase the amount you have to maintain the truck, let’s see what the difference would be.
Cost Per Day - $60
Total Number of Trips – 62
Total Cost = $60 * 62 = $3720
It still costs almost $4000 more to own the truck than to rent it. So at what point do you reach a breakeven? You would need to rent a truck 127 times to equal the cost of owning it. That is almost once a week, every week, for three years. That is a lot of truck rentals!
So what if you want to have truck instead of a car, and drive it all the time? Maybe you are thinking, “Hey, I like trucks. I want to drive my truck every day.” Well if this is true then great. Don’t let us stop you from getting and driving what you like. But let’s continue to do the comparison so that we can quantify what the difference is between owning and driving a truck and owning and driving a car.
The first cost difference that comes to mind is gas mileage. There are many different models of cars and trucks with different gas mileage, but just for comparisons sake let’s say that a typical truck gets 20 miles per gallon, and a typical car gets 30. The standard that Americans are supposed to be driving each year is 12,000 miles. So our typical truck would need 600 gallons of gas over the course of the year, and the typical car would need 400 gallons of gas for the same amount of miles. At $4 a gallon that is a difference of $800 for the year. For that price you could rent a truck more than 13 times within the year and still break even.
Of course, if you do have a truck, and you use it as often as Tim’s sister – list it on this site! That way you can start making back some of the money you are losing from owning it.
Popularity: 8% [?]
Loading ...