Should we buy our teenage child a car?

Hi WhichCar,

My kid is finishing high school this year and they've done a really good job. My hubby says we should buy their first car but I wonder if it isn't a better life lesson to get them to buy their own? He argues that less money means a less safe/suitable car - what does the WhichCar team think?

Leone,

Camden, NSW

Hi Leonie,

Great question! The next batch of Year 12 grads are very much nearing the end of the school year, and their minds are surely turning towards things like uni, jobs and gap years.

Minds are also turning towards first cars, and we should be helping them to find - above all else - the very safest set of wheels that it's possible to get, whatever the size of the budget.

It's a great time to actually assess what kind of car is going to suit your younger driver, too. Is it just for a short run between uni and home? Will it be parked at a station for long periods? Is there some country miles on the horizon with new jobs, friends and adventures?

It all needs to go into the decision pot, whoever is paying the bill.

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The same discussion about who should fund it rages on here – and I’m on your side, even though the game has changed a lot when it comes to accessing cheap cars for new drivers.

Everyone’s parental styles differ, and I’d suggest that it’s probably easier for our generation to fund the purchase of a car for your kids.

Virtually every financial expert I polled about whether a parent should buy their kids a car, though, said the same thing – if you do, then you aren’t teaching him or her a thing about financial responsibility. “It’s financial abuse!” proclaimed one prominent (if slightly sensationalist) commentator.

Listen to Tim Robson's radio interview on buying kids their first cars

While I wouldn’t go quite that far, the act of saving for and buying a car is a terrific life lesson in real-world economics, isn’t it? Budgeting to put money aside for rego and insurance, learning about preventative maintenance, dealing with things when funds are tight… it really gives youngsters a valuable snapshot into dealing with their finances in the real world.

Besides, handing over a brand new car to a debutant driver doesn’t sound particularly clever on a number of fronts. For starters, the inevitable parking dings and day-to-day scrapes are easier to bear on a $5000 beater than a $30,000 freshie.

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And its new owner may – if the lounge, TV, bathrooms and kitchen appliances in our house are anything to go by – not be as discerning or careful about something he/she hasn’t paid for.

Encouraging our young ’uns to aim at a financial goal is a smart thing, and a lot of our friends have various schemes in place – dollar for dollar matching, for example, or guaranteed help with first-year expenses – to incentivise their young charges to keep up the good fight when it comes to saving for a set of wheels.

Of course, it’s still about having money to start with and, depending upon where you live, the car may need to come before the job in order to become mobile at all, so the Parental Credit Union might need to come to the rescue in the first instance.

As for the car itself, there is a FAR bigger pool of machinery to pick from now than there was we were younger, and they are, as a rule, a lot safer as well.

Buying a new car for your teenager will, of course, guarantee that your progeny is driving something that has stability and traction control at a minimum, a decent number of new airbags and more high-strength steel in its construction than something that’s older and cheaper.

Having said that, stability control (to look at one safety system) has been compulsory for Australian-delivered cars since 2013, and there is any number of examples of cheap machinery with more than basic safety on offer. Big caveat here, though; make sure the car has been cleared for any and all Takata airbag recalls.

One hurdle we had to climb over with our car-mad son was the fact he wasn’t going to find a mint Mazda MX-5 with $5000! Keeping expectations in check is not a terrible idea, lest they come home with something that will cost more than the car’s worth to repair.

Overall, our advice is to leave your kid to find the desire and the discipline to want to save for a car, and if you can incentivise and encourage, that’s a great thing.

The brand new compact SUV in the driveway with a giant bow on it might be a short-term joy, but it may not help your youngster learn the realities - and the responsibilities - of car ownership in the long run.