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People under the age of 25 are at a significant disadvantage when renting a car. The underage surcharge (a.k.a. young renter fee) for those not aware, is a (hefty) extra per day fee that all rental companies tack on for drivers under the age of 25. While statistics show that drivers under the age of 25 have more accidents, you would think that as long as the driver has the necessary insurance that they rental company would be protected, however as is typical in the car rental industry, there are fees for everything. Given the meteoric rise of rideshare companies like Uber and Lyft, you would think that rental companies would be falling all over themselves to try to attract millennials, but unfortunately this seems to be a case of maximizing short term profit over long term growth.

Before I turned 25, all of my business travel rental cars were through Dollar Rent A Car. I held no affinity at all for the firm but through a small annual fee to a group called Student Advantage, I received a waiver of the underage fee in a time of my life where I spent about 15 days per month on the road. The Student Advantage program consistently got watered down (as most loyalty programs do) and I stopped paying for the membership once I turned 25.

More recently (e.g., "in the current century"), a great organization for drivers under the age of 25 has been USAA. Young members have been consistently able to avoid underage fees with Avis, Budget, Enterprise, and Hertz. The one downside with USAA is that it can be difficult to qualify if you're not a current or former member of the military or the child of a veteran.

Sporadic offers from rental car firms (namely Hertz) have also waived the fees for certain timeframes, such as the beginning of semester "back to school" rush. Ranging up to $30 per day, these fees frequently exceed the cost of the actual rental car! AutoSlash is all about finding the cheapest possible rentals for customers and for someone under the age of 25, the "Young Renter Fee" imposed at the counter can be exceptionally expensive.


AAA and Hertz

Suddenly, there's a quick and easy game changer available to any licensed driver between the ages of 20 and 24. AAA membership now removes the "Young Renter Fee" with Hertz and we hope that other rental car firms will follow! A fee of $30 per day can now disappear for young renters for an annual membership to AAA. The payback time for a new AAA membership could be as little as 2 days for a driver under the age of 25! And that's just from the benefits for an underage driver; further benefits provided by AAA membership (such as roadside assistance and other discounts) simply make the membership more valuable for drivers.


Why does the AAA offer matter?

Hertz waiving the Young Renter Fee for all AAA members immediately creates value for the young renter. AAA New York (as an example) has a base fee of $52.00 per year (plus a one-time enrollment fee of $15) that can be lower for initial sign-ups or drivers joining through an employer's program; that fee can be entirely recouped with a single three-day rental while the driver still has the benefit of AAA for the remainder of the year. Many of the AAA affiliates also have provisions where immediately family members can be added to accounts for little or no incremental increase in costs!

Not only does an AAA membership provide roadside assistance coverage with any vehicle - privately-owned or rental - there are also discounts on other products and services (such as hotels and yes car rentals too) around the world. For those under the age of 25, we suspect that most travelers would easily recover the cost of AAA membership through just a one or two car rentals per year.


What are the catches?

Drivers under the age of 25 still do encounter some restrictions, even with the waiver of the Young Renter Fee. Hertz - like many other firms - restricts the rental of many car classifications to young renters. For those under the age of 25, the exotic vehicles in Hertz' Prestige (Audi, Infinity, and Mercedes), Adrenaline (Corvette and other sports cars), and Dream Car (Jaguar, Porsche, and Tesla) Collections would all be entirely off-limits.

Another stumbling block we see with the youngest renters is that customers still must be able to meet the basic rental requirements of Hertz. Those requirements do include a credit card, in the driver's name, with a sufficient limit to cover the vehicle as well as the authorization for additional services. For the youngest of renters in the 20-24 age group, this might be more of a challenge after the passage of the Credit CARD Act of 2009 placed restrictions on issuing credit cards to those under the age of 21 (an unintended consequence of U.S. government regulations).

Another stumbling block we see with the youngest renters is that customers still must be able to meet the basic rental requirements of Hertz. Those requirements do include a credit card, in the driver's name, with a sufficient limit to cover the vehicle as well as the authorization for additional services. For the youngest of renters in the 20-24 age group, this might be more of a challenge after the passage of the Credit CARD Act of 2009 placed restrictions on issuing credit cards to those under the age of 21 (an unintended consequence of U.S. government regulations).

Lastly, for those still in their teens (18 and 19 year olds), AAA membership unfortunately won't help you (yet) to avoid the underage surcharge. For you teens, you'll want to try to find some way to qualify for USAA membership. Hertz is unique in that they are the only one to waive the underage fee for 18-20 year olds, but only with a USAA membership. In fact, if you try to sign up for the Hertz Gold Rewards program, the dropdown menu to select your age doesn't even show 18-19 unless you link to it from the USAA member page. Note that USAA membership is typically restricted to active, retired and discharged members of the U.S. military or adult children of existing USAA members. If one of your parents served in the military, you are probably eligible through them.


Our Take

For a budget-conscious young traveler contemplating AAA membership, the new underage fee waiver through Hertz is effectively a slam dunk. While Hertz isn't always the cheapest rental car option via base rates, avoiding a Young Renter fee that's otherwise $20-30 per day at competitors is clearly going to make Hertz the lowest all-inclusive rate much more often, not to mention the Hertz AAA discount and associated coupons is often one of the best as well! We're happy to help young renters book the rate appropriate for their local AAA affiliate to save on their car rentals - helping others save is what we do!

Current AAA members can click here now to get a discounted rate quote from AutoSlash. Be sure to select AAA on the membership screen. Note that once you book with Hertz (and only Hertz), it's important to email us to ensure that the AAA discount is applied to your reservation so the underage fee is waived for your rental.

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