Sending your teenager off on the open road is an exciting but incredibly nerve-wracking experience. With hours and hours of driver’s ed behind them, and your words of roadside wisdom running through their minds, you know they’re prepared, but you can’t help but worry as their parent. If you’re planning to buy a vehicle for your teen, you want to make sure it’s as safe and practical as possible. But since you probably won’t want to purchase a luxury car for their first years on the road, picking out a good first car for your teen is a little different than selecting a vehicle for yourself.
In this article, we’ll be discussing our top tips and tricks for shopping for your teen’s first car.
1. Determine a budget
Even if your kid’s been working part-time already, they likely don’t know the true value of a dollar just yet, so they might be unsure of how much a car should cost and what’s a good deal. To avoid any drama on the dealership lot, it’s best to determine a budget ahead of time.
Your budget depends on your own financial situation but considering whether you shop from a new or used car inventory should be something all families consider. Data shows that new cars depreciate in value an average of 10 percent or more the moment that they’re driven off the lot and 20 percent or more after the first 12 months of ownership. Why such an extreme drop? When you buy a new car you’re paying for the “newness” of it—hardly any miles, untouched leather seats, brand new entertainment tech, etc. The second this car is driven, its “new car” label is stripped away and the value decreases.
A used car could be a great option for anyone buying a car since they’re typically in great shape anway, but it makes even more sense if you’re shopping for a vehicle for your teen.
If you need an auto loan to finance your purchase, be sure that you and your teen are on the same page about paying off the balance. Consider your financial situation, credit score, interest, and the length of the loan before determining if it’s the right decision for your circumstances.
2. Compare safety ratings
Above all, safety should be your first priority when buying a car for your teenage son or daughter. Once you have an idea of the kind(s) of vehicles your teen wants, use a car safety comparison tool to help you determine which vehicles are the safest options to consider. The National Highway Traffic Safety Administration has their own safety comparison tool which can be used to look up the rankings of certain makes and models.
3. Calculate efficiency
Another thing you’ll want to consider when shopping for a car is the fuel economy, especially if your teen is planning to drive several miles to school, work, and social commitments. If they are driving a lot or have an eco-conscious mindset, a hybrid or electric vehicle might make sense for them. Use FuelEconomy.gov to test and compare fuel economy ratings for different cars.
4. Eliminate extras
When you’re shopping for a car with your teenager, they’ll probably be tempted by all of the fancy features of the display models and advertisements at the dealership. Remind them that almost all of these extra items can be added on aftermarket to save money. Aftermarket car stereos, for example, are widely available and easy to install.
5. Pick the right insurance
Ensuring that your teen’s car is safe is paramount, but making sure they’re legally protected in the event of an accident is also extremely important. In fact, many states like California, require drivers to have auto insurance. To make sure that your child is protected and abiding by state regulations, be sure to pick out the right auto insurance plan for them. Many insurance companies offer teen driver coverage that’s built specifically for younger drivers with features like roadside assistance and lifetime repair guarantees.