Teenager Pays to Drive

When your kids turn 16 (in the United States) they’ll be able to start driving. This is an exciting time for them, and a nerve wracking experience for you as a parent. While you may be glad that they’ll finally be able to drive themselves all over the place, you’ll likely still be nervous for them being out on their own.

As kids approach the age where they can drive, it’s important for them to understand that driving is not free. Getting gas in the car, or having insurance on that car costs money. If your child doesn’t see or feel these costs as they start driving, at some point in the future it’s going to be a real shock when they come to realize that they have to pay for those things, in addition to paying to own a car.

As a parent, you likely want to provide everything you can for your child. Buying them a car would be awesome. Paying for their insurance and gas money will make it easier for them right now. Your child won’t complain that you’re doing those things for them right now either. If you don’t, you’ll likely hear some complaints from them. It’s definitely easier to do those things for them if you're in a financial situation that allows you to.

Unfortunately, paying for all of the costs associated with driving for your child will not help them get a grasp on how the world actually works in relation to paying for a good that they want/need. In these times where many struggle to understand their finances, it’s important to teach your child about how finances work and that most everything costs money.

There are varying levels as to how much you make your child contribute to be able to drive:

• Make your child pay for gas. This should be the minimum level that your child contributes to driving. If they want to drive places on their own, they need to pay for their gas to get to those places. You want to go to your friend’s house, then you’ll pay for the gas. Depending on the car situation, it may be a little tricky to figure out how much they should pay for gas, but figuring this out should be a starting point.
• They should pay for their insurance. Adding a child to your insurance is expensive. There’s a good chance that your insurance bill will double when you add a new teenage driver to it. Having your child help pay for their portion of the insurance cost will help them be prepared for that cost when they get out on their own. It’s probably best to get the payment for this on a monthly basis from your child. Not every parent will feel comfortable making their child pay for their own insurance. If you don’t want to charge your child for insurance, then setting a baseline for what they have to do to not pay for insurance should be part of the plan. For example, saying that your child will earn certain grades, or participate in certain extracurricular activities would earn them free insurance. Basically, your child is being productive with their time.
• Have them pay for the car. If you’re getting your kid a new car as part of them beginning to drive, having them help pay for that car can also be an excellent lesson in what it costs to own a car. Whether or not you’re going to have your child help pay for a car, you should not get your child a brand new car. Kids are at high risk of getting into an accident, and having the nicest/newest car is simply not worth it during their early driving careers. If your kids are simply driving an existing car, it may not make sense that they have to pay for car payments either.

These are just a few ways your child can help pay for driving the car. While doing all of these things may not make sense for your family and your situation, having a child help pay for the costs of driving is something that you should do to some degree. Learning to drive is a great privilege, and one that should not be taken lightly. Teaching your kids about the responsibilities that come along with that privilege will be a great learning opportunity for them.