Getting a car is an incredibly exciting point for any teenager; however, getting your first car is an incredible financial and personal responsibility. Many financial experts agree that teenagers should help pay for their first car. Here’s why:
1. It Teaches Them to Save
Many adults have a hard time saving money or learning the discipline to make saving a regular practice. In fact, according to a survey completed by Bankrate’s Security Index, 29 percent of people don’t have an emergency fund at all. So, this is a great skill to teach your children so they grow into successful adults who are able to save with ease. Teaching them to put away money in an account is an acquirable skill, and a great way to incentivize this is to get them to help buy their own car.
2. It Shows Them How to Meet a Goal
Teaching your children to be goal oriented is a skill they can take with them their entire lives. The key to reaching goals, of course, is to make them manageable. So, don’t set your kids up to fail by telling them to save for a luxury car. Instead, give them the goal of saving for 50 percent of a $10,000 car, telling them that if they meet it, you’ll match them with the other 50 percent. This helps them learn to set goals that are challenging, but reachable.
3. It Builds Confidence
There’s no greater feeling than reaching a goal you worked so hard to achieve. Many people suffer from a lack of confidence, but teaching kids early what it feels like to work hard and reach their goals will help them to build that confidence. Not only that, but once they realize what they can achieve, they’ll be much more likely to work hard to achieve goals in the future.
4. It Instills a Work Ethic for the Future
Even if you can afford to give your child a nice car and pay for it in cash, you should still encourage them to contribute to buying their first car and working for the funds to get them there. There is no better way to teach work ethic than by linking working hard to an awesome reward. To a teenager, a car and the freedom it brings is everything. Teach them to build the work ethic, and they’ll know what it takes to work hard to purchase even bigger investments in the future.
5. It Helps Them to Care for the Car
Last but not least, encouraging your kids to pay for part of their first car as a teenager will make them take care of their car. If the car is just handed to them, they might drive a little faster or be a little rougher with it. Many teenagers get into accidents, which is why adding them to your insurance plan costs so much. However, if they worked hard and spent a few thousand dollars of their own money on their first car, they will be much more likely to drive carefully and treat their car well (and that’s what every parent wants from their young teenage drivers).