Renting a car used to not be a big deal. Gas was cheap, and rental agencies constantly competed to see who could go lower in price. The consumer was the beneficiary; renting a car was never a major vacation expense. Those days are gone. Whether traveling for business, pleasure or simply to have wheels for a week while your vehicle is in for repairs, renting a car can now add up to a major cash layout.
The most obvious way to save money on a rental car while vacationing is to book it in advance at the same time you buy your airplane tickets. This works especially well with budget airlines (e.g., Allegiant or JetBlue). As you book your airfare on the airline's website, you may notice a screen or pop-up window that offers a deal on a rental car. Consider booking it: Renting on short notice later in the game along with the business travelers will almost certainly result in a higher price.
When you go to pick up your car, ask the rental agent if she has any current deals available. If you're flexible with your choice of make and model, she might be able to help you. Always get a list of the extra fees and expenses you might incur. For example, if you bring the car back without a full tank, the agency will fill it up but will also charge you ridiculously high per-gallon rates in the process.
Car rental agencies closer to the airport will be more expensive. Do your research beforehand and look for businesses located a few miles or more away from the airport. Many will even come pick you up at the airport for free. Remember the lower-budget agencies, too, no matter where they're located. Don't be scared by names like Rent-A-Wreck. Their cars may have higher mileage, but they're clean and well maintained.
You might even want to take the time to go beyond franchise car agencies completely. In most towns, you'll find businesses like car lots and repair shops that also dabble in rentals on the side, usually at a lower price than the big boys. And don't forget aggregate online-travel businesses like Priceline and Travelocity. They deal in car rentals also.
Your car is in the shop for a week for repairs and you have no wheels. With a job, school and kids' activities, this can be a tremendous problem. If you're looking for wheels to use locally, it probably makes sense to bypass the rental chains if you're looking for the best price. Find a local business and be prepared to swallow your pride: It's going to be much cheaper to rent that tiny box with a lawnmower engine than a massive luxury SUV. Smaller cars can be found for $20 per day or less. Renting for a week at a time might also save money over the regular daily rate.