That magical moment when your teenager reaches driving age can be both exciting and stressful. While you’re thrilled your child is now old enough to get behind the wheel, the reality of what that means will quickly begin to affect your wallet. Having a teen driver means extra expenditures, including higher insurance, dealing with potential accidents, and dropping the money for a new vehicle. If you’re not careful, these numbers can add up, leaving you overwhelmed and even more stressed out. If you have a teen who’s ready to hit the road, consider this your guide for understanding the true costs involved.
The right vehicle
The most important step for a teen driver is finding something to drive. Unless your teen is prepared to handle the full cost on their own, it’s likely you’ll need to at least partially cover the cost of their first vehicle. Finding that vehicle will be a balancing act between overall affordability, and giving your child the safest vehicle you can. Since the vehicle you choose will likely be used, making sure that everything works properly is also a priority. Michael Evans, writing for Bankrate.com, cites vehicles in the $10,000 to $15,000 range as being the best candidates for new drivers. By staying within this range and making sure each vehicle you test drive meets your safety requirements, your teen will be ready to get driving in no time.
Climbing insurance
Adding an extra vehicle to your garage will, of course, result in hiked insurance rates. The amount your rates will increase depends on a number of factors, including the type of vehicle your teen is driving. Young drivers are notoriously expensive to insure, with rates often in the $1,000 to $2,000 range. In an article for CNBC.com, contributor Paul Eisenstein states a doubling of your insurance after adding a teen driver is completely possible. “A 16-year-old will cause the typical premium to go up 99 percent, a figure that dips to 90 percent for a 17-year-old, 82 percent for a driver aged 18, and 65 percent for someone aged 19,” writes Eisenstein. So if you plan on adding your youngster to your plan, be prepared to pay extra.
Maintenance and accidents
According to the IIHS, the age range at highest risk of experiencing a serious car crash is 16 to 17 years old. That said, it’s best to be financially prepared in the event of an accident. First, there’s the maintenance fees. Everything from a minor fender bender to a major crash will result in your teen’s vehicle needing repairs, and that can get pricy fast. And then there’s the insurance. As previously mentioned, adding a teen driver to your policy isn’t cheap. If an accident occurs, those numbers will increase even more. You could be looking at thousands of extra dollars added to your bills.
Other expenses
The financial strain doesn’t end at vehicle purchases and insurance. There are plenty of other pricey expenditures to consider before your teen starts driving. A big one is driver’s education classes, which can range from $200 to $800 according to DriveSafe, depending on your state’s requirements. Before your teen can drive a vehicle off the lot, they’ll need the proper tags and a title. Depending on the vehicle’s sticker price and the added taxes involved, this could cost an extra $1,000. Finally, your teen will have to fuel their vehicle, and that can add hundreds of extra dollars into the mix.
By keeping these numbers and facts handy, you’ll be better prepared to welcome your teen into the world of driving and vehicle ownership.