During the transition between high school and college, kids often crave independence. As a financially responsible parent, here are a few things to consider when helping your student buy a car.
Buy or Lease?
There are pros and cons to both. Buying a car can be a terrific way to build one’s credit. However, leasing a car might make sense if you are unsure about long-term commitment and want a little flexibility.
New or Used?
While new cars are almost always more expensive than buying used, you’ll generally save money on maintenance and repairs on the former.
Big or Small?
This is definitely important for new drivers. Some drivers feel that larger and heavier cars tend to be significantly safer, but consider staying away from vehicles with a lot of power that could entice a novice driver into poor road choices.
Buying or leasing the car won’t be your last expense. Factor in insurance rates, costs for fuel and typical repairs before making the final decision.
Are you the parent of a college student wrestling with this purchase? Let us know in the comments below.