Car Ownership for Teen Drivers

Getting that first car is a rite of passage for many new drivers.

But while you’re dreaming about the freedom and excitement of your first set of wheels, you also need to think realistically about what it’s actually going to cost you.

Expenses

Sticker price

The amount you pay to purchase your car. The best cars for teens average around $11,000.

Other purchasing fees

This includes your taxes, tags and title, and averages around $1,000, depending on your car’s sticker price.

Finance charges

If your family takes out a loan to pay for the car, you’ll have to make monthly payments plus interest to pay it back.

Insurance

Young and inexperienced drivers can be expensive to insure. Annual insurance cost averages range from $1,000-$3,000.

Maintenance and repairs

The more you drive, the more upkeep your car will need, including oil changes and new tires, as well as miscellaneous costs like parking and car washes.

Gasoline

Annual fuel costs can average close to $1,000 or more, depending on your car’s fuel efficiency and how much you drive.

Depreciation

It’s the largest cost of owning a car. In five years, your car will be worth about 65% less than when you buy it.

Car ownership isn't cheap — for you or your parents. Have an open discussion with your family about what you can afford, what you’ll be expected to pay for, what your parents will help you with and whether or not it’s the right time to take the plunge into car ownership.

Sources:
Driving-tests.org
Ameriprise Auto and Home Insurance