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Don't let summer car rentals crash your wallet

"Today" financial editor Jean Chatzky shares some cost-saving tips to help you enjoy fun-filled road trips without breaking the bank.
/ Source: TODAY

Despite high gas prices, nearly half of Americans will take a road trip this summer, according to Mapquest.com. If you're doing it in a rental car, that likely means paying up twice — each time you visit the pump and to procure the car in the first place.

Not only are you renting during peak season, but car rental rates this summer are up significantly over a year ago. Prices at airport locations have jumped 8 percent from last year and 20 percent at off-airport locations, according to Abrams Consulting Group in Purchase, N.Y. Plus, high gas prices will add an average $30 to $50 extra to the cost of your typical summer trip, according to the Travel Industry Association. To make matters worse: "Right now is peak season for rentals," says Neil Abrams, rental car expert and president of Abrams Consulting Group. "If the rental companies don't make (the bulk of their profits) in the May through September window, they are not going to make it."

Of course, none of that means you should stay home. Instead, follow these savings tips.

Book as early as possible. The less expensive economy cars generally go first. To make sure you're not forced into an SUV that will in turn cost you $30 or $40 more per day, book as far ahead as possible. Then monitor prices until your departure day. Unlike airlines, car rental companies typically do not charge a fee if you cancel your reservation, says Abrams. So if prices drop, simply call and cancel, then rebook at the lower price.

Fill 'er up yourself. The rental agent at the counter generally asks you if you want to pre-pay a tank of gas. That means you will not have to fill up before returning the car. "We recommend declining this prepaid gas," says Philip Reed, consumer advice editor at the car Web site, Edmunds.com. You are paying a very hefty premium, as much as two times the retail rate on gasoline, for the convenience. Plus, if you return the car with even a gallon of gas, you do not need to pay for an entire tank. So find a gas station within 50 miles of the drop-off location, generally the distance you can drive before the gas needle moves off of full, and fill the tank yourself.

Decline insurance and waivers where you can. The agent at the counter will explain to you (often in unfortunately cumbersome language) that you will be responsible for the entire monetary value of the car if you waive the collision damage coverage. What happens? More than 25 percent of consumers who buy it do so because they are unsure if they are already covered by their personal auto policy, and 15 percent feel pressured into it, according to a survey by the Ohio based Progressive group.

A large number of these people are paying $9 to $20 a day for coverage they don't need. The solution is to figure out what coverage you already have before arriving at the rental counter. This coverage often duplicates insurance you have through your auto and homeowner's policies. If you charge the car to a credit card (particularly a gold or platinum one) you may be covered by your card issuer as well.

Avoid airport rentals. You can save 10 to 20 percent by renting a car from an off-airport location. When you rent a car at an airport, companies add all sorts of surcharges and fees. So if possible, take a shuttle or cab to a location away from the airport, especially if you are headed downtown. (Note: You'll even see a price difference renting from the same company by going to an off-airport location.)

Return on time. In years past, if you returned a car within one hour of the designated return time, then you were off the hook from paying for additional time. But some of the larger car rental companies have reduced that grace period to 30 minutes, says Abrams. Depending how late you are, you will be charged an hourly fee or even for an additional day — or more. If you return the car on a Monday and must pay for an additional day, the one-day rate for Tuesday may cost you as much as the total bill for the weekend, because weekday rates are often much higher than weekend charges, warns Reed.

Go local. You can typically save money by renting from non-household name brands. Many regional and local companies exist that provide quality cars at very affordable rates, says Abrams. Search sites such as carrentals.com and carrentalexpress.com to find these second or third tier players. For example, companies like Advantage Rent-a-Car and E-Z Rent-a-Car cater to leisure travelers. They don't necessarily provide all the bells and whistles of a Hertz, but do you really need all that?

Jean Chatzky is an editor-at-large at Money magazine and serves as AOL's official Money Coach. She is the personal finance editor for NBC's "Today Show" and is also a columnist for Life magazine. She is the author of four books, including "Pay It Down! From Debt to Wealth on $10 a Day" (Portfolio, 2004). To find out more, visit her Web site, .