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Question of the Day - 15 May 2009

Q:
I have submitted my question a couple times. I know you have lots of questions each day. If you don't want to answer my question, please just e-mail me and let me know who I should contact. We come here at least six times a year for a couple weeks at a time. I would like to buy a car instead of renting each time we come. I'm sure I'm not the only one in this situation. Our home is in Aliante so it would be expensive to take a cab each time I come. I'm wondering what people do who are in my same situation.
A:

This seems to us to boil down to an equation requiring some simple arithmetic and involving, on one side, the cost of the car (plus annual registration and insurance) and making the round-trip between Aliante and the airport every couple of months, and on the other side, the cost of renting a car for 12 or so weeks a year.

For the sake of argument, let's say you buy the car for $10,000 and pay another $1,000 for annual expenses and a $100 for cab fare and tip to and from the airport each trip. So the first year, you spend $11,600.

Let's also estimate $500 for your rental car each two-week period. The first year, you spend $3,000. So buying the car is $8,600 more expensive initially.

The second year, you spend another $3,000 on rental cars, but only $1,600 on car-owning expenses, so you're only down $7,200. The third year, you're down $5,800. Assuming a stable $500 for each rental period, $100 roundtrip to the airport, and no car repairs, you're at breakeven after seven years and two months. That's a long time to pay off a quickly depreciating asset like a car, in our humble opinion.

Now let's look at ways to cut down the $600 estimated airport cab fares, your main concern.

First, and this is a technique used by some locals we know who live way out by Red Rock Station, you can rent a car for one day. This worked better in years past when rental-car prices were much much lower, but it can still save you a little money, and a lot of time (considering the other alternatives; read on) if you shop around and get the smallest car at the lowest price. After all, you're just going from the airport to your house. The next day, or even later the same day, your spouse follows you back to the airport in your own car, then you're home free. Then you repeat the process in reverse on your way back to the airport.

Let's say this saves you half the cost of a cab, $25. So you've cut $300 off your yearly nut and the breakeven on you Vegas car is right around seven years.

Second, let's do the arithmetic for taking an airport shuttle to a downtown hotel ($15 for two when you buy the roundtrip), which gets you roughly halfway to Aliante, then grab a cab from there (say $25) for a total of $40 or a $10 saving. Do the same in reverse and save $20 round-trip and $120 per year. Spending $480 instead of $600 for transportation to your vacation home, your breakeven on the car is seven years and eight months. Obviously, this option consumes more money and time than renting a car at $25 for the day.

Next, we'll assume you travel lightly, since your vacation home is presumably furnished with all the necessities you'd ordinarily have to carry with you. Thus, you could conceivably ride the bus from the airport to Aliante. (Take Bus 108 from the airport to Flamingo; transfer to Bus 202 westbound to Paradise; transfer to Bus 119 to Aliante.) The trip each way, including transfer times and walking from the bus stop to your house, will take approximately two hours and cost only $7 roundtrip for two, $84 annually. So now you're saving $516 per year on getting to and from your house, which adds up to breakeven on the car in only five years and four months, a significant saving, we think.

Of course, you are spending four or five hours each trip to Las Vegas riding the bus, but assuming time is less important to you on your frequent vacations than money, it could be worth it to you.

Finally, if you can't hack the thought of riding the bus for two hours or so each way, but you like the $84 a year, one other idea is to take your chances leaving your car in a casino parking garage near the airport. The MGM Grand garage, for example, has thousands upon thousands of spaces and the only telltale sign that a car has been left there for a couple of months would be the fine layer of dust that accumulates on it. You could try it once and see how it feels; if it's no big deal to you, you'd park the car there (or at Excalibur or Luxor or Tr

Update 14 May 2009
Great minds think alike: "In response for the QOD tomorrow -- we have a home in Mountains Edge and have a Vegas car. While our home is presumably closer to the airport than Aliante, we still were paying $35-$40 for a one-way cab AND found the cab going back to the airport to be very unreliable in picking us up -- we almost missed a flight one time (I believe you discussed locals cabs during a QOD a year ago or so). "We rent a car for one day on the day we arrive in Vegas and the day before we leave. Often we can get a car for around $25 (including tax/fees) with some pre-planning and rate shopping. This has given us the freedom to dive right into Vegas vacation (shopping for groceries, a quick casino drop-in, etc.) before we even get to the house on the first night and the comfort to know that we are in control of our return to McCarran on our day going home. "The only problem with this is that you end up having to drive the extra car 2x to the car-rental facility (day after you arrive and day before you leave) to pick-up/drop-off rental car. I have also found that some agencies have local car rental locations and often have very good rates and will allow you to drop off at the airport. "One other benefit. You get to avoid the long taxi line at the airport AND your frequent one-day rentals can add up to a free rental (through programs like Dollar's Fast Lane: 16 days = 1 free day)." And another interesting suggestion from a reader: "Make friends with a couple of neighbors. Certainly you have someone watching over your property when you're not there. Offer to fill up their gas tank, or take them out for a nice dinner or something equally thoughtful if they'll pick you up and/or take you to the airport during your visits. You don't have to always use the same neighbor, unless of course you're lucky enough to become really good friends with someone who you know doesn't mind making these trips or who could certainly use the gas, meal, or cash you would be offering. I know that as a retiree I am often called upon to shuttle folks back and forth to the airport and actually enjoy the opportunity to do something useful for my friends. Fortunately, I'm able to afford to do it on my own dime, but I'm always offered something by those I transport. This way you could garage your car at your own property and have it available when you arrive, but wouldn't be incurring the expense of a cab, the hassle of double trips to and from rental-car facilities, or spending hours on and off shuttles and city buses trying to get home." And we figured we were missing something that someone would point out to us; here it is: "You left a very important variable out of your calculatons. While cars may 'quickly depreciate,' they do not drop in value to nothing instantly. Even after seven years, there is a residual value to your auto, while there is no residual value from renting a car. This residual value must be taken into account and it can be several thousand dollars even on a cheap economy car. This makes buying a car a much better deal than you calculate it as."
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