4 types of cars you should never let your teenager buy, and why a Tesla might be one of them

It’s time for your teenager to buy a car. You’ll want to set some ground rules. The last thing you want is to put your child in the driver’s seat of the wrong car.

The best way to avoid disagreements is to set clear expectations and boundaries with your teen before the navigation begins. While holding your teen back may initially dampen their enthusiasm, it could become a valuable learning experience that will guide them once they leave the nest.

4 prohibitions for choosing a car

In many cases, the budget will limit the options available. But once you’ve decided roughly what your price range is, you can tactfully define your no-go areas for selecting a car.

Here are the four biggies to avoid:

Major power

The statistics on young drivers are quite alarming. “Crash risk is especially high during the first few months of clearance,” according to the Centers for Disease Control and Prevention. The younger the driver, the higher the risk. The risk of a crash is 1.5 times higher for a 16-year-old driver than for an 18- or 19-year-old, according to data from the Insurance Institute for Highway Safety.

And today, we put our children behind the wheel of cars with power almost unimaginable a generation ago. For example, a Toyota MC,
-0.92%
The Rav4 Prime hybrid produces 302 horsepower, about what a Ferrari RACE is,
-0.15%
manufactured in 1990. A Tesla TSLA,
-1.79%
The Model 3 sedan produces nearly 500 horsepower and sprints to 60 mph in less than four seconds, faster than a Corvette the year today’s 16-year-olds were born.

When inexperience meets temptation, bad things happen. Mistakes are more costly at high speeds and crashes are more serious. Worse still, street racing has surged during the pandemic, as The Associated Press reports. Your child can still decide to ride the family Honda HMC,
-1.29%
Civic, but it’s hard to resist the call of a Dodge Charger V8.

Speed ​​isn’t just about power, of course, but choose the slowest car possible. It will probably be faster than anything you drove as a teenager.

Also see: Why a Used Electric Vehicle is a Great Choice for Your Teen’s First Car

Luxury cars are past their prime

It is surprising how quickly the price of a luxury car drops, especially when there is no shortage of new cars. In a non-pandemic environment, some high-end cars lose about half their value in just three years, according to car search engine site iSeeCars. This might lead your teenager to suggest a seemingly affordable old Mercedes as a good choice.

Unfortunately, these cars have a hidden cost: repairs and maintenance.

Take a lesson from Carvana CVNA,
-6.59%,
the online powerhouse that sells hundreds of thousands of cars a year. If you bought a 2013 Honda Fit with 96,000 miles from Carvana, its basic two-year powertrain warranty would cost $1,150. Buy a 2013 Mercedes C-Class with 96,000 miles for just a little more money, and the powertrain warranty costs $4,300.

This cost would cover unexpected large expenses. It doesn’t include maintenance — oil changes, filters, coolant flushes, wiper blades and the like, which CarEdge.com puts at around $2,000 a year for a 10-year-old C-Class. , which is about double its estimate for the Fit.

Moral of the story: Avoid used luxury cars unless you have the money to maintain them.

Lily: How to use telematics to monitor your teen’s driving

Upper-Fixers

Unless your young driver is also an expert mechanic, buying a project car that doesn’t run or has serious problems is a bad idea. While cars that are sold “as is” have low prices, it’s hard to know how much it will cost to run them. Also, without the benefit of a test drive, once you begin the repair process, additional issues may be revealed.

As the old adage about used cars goes, you don’t want to buy someone else’s problems. If it “just needs a battery”, chances are the owner would have replaced it.

Party wagons

It’s tempting to buy your child a big car that can fit their siblings, all their sports gear, or whatever else they’ll need to haul. While this might make your life a little easier, you should be aware of how many friends — read “distractions” — your child can fit in the car.

This is because the CDC has found that having teenage or young adult passengers increases the risk of a crash for the driver. In fact, the CDC found that “the risk increases with each additional teenage or young adult passenger.”

Also see: The spendthrift life of teenagers: Nike, Chipotle and Snapchat

How to buy a car with your teen

Now that you’ve eliminated the negatives, here are some positives to make this a collaborative project for you and your first time buyer.

Set a budget

Decide who will pay for the car – parent, teen or both – and what your price range is. If you want to finance the car, your child will get a great introduction to learning how to choose an affordable car payment and shop around for a loan.

Go through the total cost of car ownership to make sure your teen understands this financial commitment and is budgeting appropriately.

Get pre-approved financing

Applying for a loan in advance will reveal what you, your teen over 18, or both of you, if you co-sign, will be eligible for and provide a breakdown of interest and monthly payments. In addition, a loan offer in hand will become a useful negotiation tool to obtain the best interest rate from the dealer.

Choose target cars

Finally, here comes the fun part. Now that you know how much you can spend, you can start researching specific cars. Think about how it will be used and how often. Check safety ratings and fuel economy, and estimate insurance costs.

A car buying app is a good place to start. It’s a good idea to search for multiple target cars because you never know what you’ll find nearby and what condition it is in. You have to choose from what is available.

See: Keeping these things in your car will prepare you for almost any emergency

Get an inspection

A pre-purchase inspection of a used car costs between $80 and $200.

Monitor the case

Your child may want to lead the negotiations, but you’ll want to keep an eye on all the paperwork. Review everything: the deed of sale, the title, the sales contract if you are financing. Whether you’re buying from a dealership or privately, you’ll need to negotiate smart and methodically check the numbers.

It will be a learning experience for both of you.

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Philip Reed writes for NerdWallet. Email: [email protected] Twitter: @AutoReed.

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