When your first son or daughter reaches the sweet age of sixteen, it can mean a new freedom for both you and them -- they get the freedom to drive themselves to school, work, friends' houses, etc. and you get the freedom of getting back the time that you used to use driving them to all of those places. In fact, it can free up even more time for you because you can send them on errands, like going to the grocery store to pick up some milk, instead of having to go yourself. However, this new freedom can come with a price (buying a car isn't cheap). Follow these tips to help save some money when your teen starts to drive.
Teens are what the auto insurance industry refers to as "high-risk drivers," so their insurance can be costly. However, there are many ways you can make things cheaper: bundling with your own insurance, getting a multi-car discount, and simply shopping around for the company with the best rates for your teen.
Your teenager can also do several things to bring down their insurance cost. After they've finished with regular driver's ed, they should look at taking a driver's safety course, which will help them be "safer, more skilled, [and] involved in fewer collisions with fewer injuries," according to TeenSMART. On top of being a safer driver, most insurance companies will also offer a discount for teens who have completed the course. Most auto insurance companies also offer discounts for teens who get good grades. While you should always encourage your teen to do their best in school, this is a nice extra incentive for them to do well on their report card.
Buy an Older Car
At sixteen, your teen doesn't need to be commuting on the highway or going on long road trips -- they just need something to get them a few miles around town. Teens also aren't the best drivers, so you probably don't want to get them a nice, new car just to ding-up. Buying your teen an older car can have several cost benefits, as well as the peace of mind that it won't matter as much if they accidentally scrape it on the curb.
It's cheaper to purchase -- Obviously a well-used car will be cheaper than buying new. Look for an older-model of car with low miles for the year and be sure to check online resources to ensure that you're paying fair market value for the vehicle.
It's cheaper to insure -- As a general rule, older cars are cheaper to insure. Be sure to look over the specific model you're buying to determine if it has a good safety rating and reliability, and check with your insurance company before you purchase the vehicle to find out exactly what your rates will be.
It's cheaper to fix -- When your teen does end up damaging a fender or breaking a headlight, it's likely that there will be lots of used replacement parts available for the car, which will cost you significantly less than buying new. Get familiar with the scrap yards in your area, like City Auto Wreckers, and find the one that specializes in your teen's type of car (many auto scrap yards will specialize in domestic, European import, Japanese import, and, more recently, South Korean import -- some even specialize in trucks and SUVs). Before you go to the scrap yard, look at how to remove the part from your teen's car and bring any tools you need with you to the scrap yard, as most of them will have you pull the parts off the junk cars yourself.
It's an exciting time when your teen gets their driver's license and a new-found freedom. Use the tips above to save yourself some money and stress when helping your teen get their first car.