The Car Purchase Project
by Barbara Frank
4 Ways to Reduce the Cost of Teen Auto Insurance
Kids and Wheels
Can Your Budget Handle a Teen Driver?
When the urge to buy a car hits your teenager, it will be time to do this project. His interest level will be high, and he will be more than happy to work his way closer to the day he has his own wheels.
This project is most effective when done with a car chosen by your teenager. Chances are, he already has his eye on one, so use that, unless it's something totally out of the realm of possibility. In that case, have him set his sights a bit lower. This is a reality project, not a fantasy.
If he has no specific model in mind, have him point out a vehicle that appeals to him while you're out driving, and use that. Or, if a friend or relative is getting ready to sell a car, and there's a possibility it might end up in your garage, use that.
For example purposes, we will use a Jeep Grand Cherokee, made by Chrysler. Since most teenagers have limited resources, and since the majority of homeschoolers are single income families who also have limited resources, we'll research a used car. Please note that unless you intend to culminate this project with an actual vehicle purchase, make it clear to your teenager that he is doing this research for educational purposes only.
Once you and your teenager have decided which car to research, the two of you need to discuss who would be paying for it, and how much money would be spent on it. Then you can put him to work doing the following steps:
Your teenager should look through the cars-for-sale section in your local newspaper, and highlight the Grand Cherokee ads. (The weekend ads usually have the widest variety of models.) He should include any within $2000 of the price chosen by the two of you.
He should highlight those that include the mileage. If none of the ads specify mileage, have him call a few sellers and ask how many miles are on their vehicles. He should take notes, as savvy sellers will mention other features of their cars, and he can use their worth to determine a fair price.
Direct him to one of the following websites:
Or try any other car site that includes a search engine requiring the user to input the model, year, mileage, condition and features of the specific vehicle. For example, at edmunds.com, your teenager would click on "used cars," and then click on "what is your car worth." He would type in the model, style and year he's researching, and then he would get the opportunity to type in the mileage and any options that were added to the car. Those features are all considered adjustments, which are used when the site computes the prices on the pricing report (which comes up after he's selected all the options).
He should study the pricing report. At edmunds.com, three prices are listed. They are trade-in, private party, and dealer retail. Explain to him why there is such a difference between the three, and that he should be most interested in the private party and retail prices. Explain also the benefits and risks of buying from each type of seller.
Now that he knows how to do it, he should obtain pricing reports for several other cars he found in the want ads, so that he can compare them to determine which cars he can afford. This is easily done by filling in a simple comparison chart, made by listing each model across the top of the page, listing the titles "Price," "Mileage," "Options," and "Seller" down the left side of the page, and then filling in the information for each car in the appropriate columns.
By studying the completed chart, he should see that there is not always a direct correlation between age and price, since mileage and options effect the price.
Once he starts to favor one specific model, he should click on one of the site's links to a ratings site. There he will see how that car has been rated by past owners. Other ways to determine the consumer rating of a vehicle include:
- going to a website such as www.consumerreports.org
- going to a search engine (ex. www.google.com) and typing in as keywords the name of the vehicle and the word "owners" (ex. "Jeep Grand Cherokee owners").
- going to your local newsstand or your public library and obtaining a copy of Consumer Reports Used Car Buying Guide.
Your teenager should scan the car dealer ads in the local newspaper and find the websites of several local dealers. Many dealers now list their inventories online, which is very helpful for this type of research. Your teenager should go to each website and bookmark those that maintain their inventory list online. By doing a search of each one's inventory for his chosen vehicle, he will be able to find some for sale nearby. If he is already of driving age, take him to see and test-drive one or more of his chosen vehicles.
Once he has found a vehicle that suits him (and you), make sure he has written down the make, model, year, mileage, and safety feature information, because he'll need it for your next project, researching the cost of insuring his dream car.
This project is excerpted from the book Life Prep for Homeschooled Teenagers. The book includes step-by-step projects (requiring minimal preparation by the parent) that teach teenagers about credit, insurance, taxes and many other subjects they'll face once they're on their own. For more information, visit www.cardamompublishers.com.
Share your thoughts about this article with the editor: Click Here
Trending on TDS
- Buying an insurance friendly car
- 10 ways to reduce the cost of your commute
- The squeeky wheel does not always get greased
- 5 common ways you are killing your car
- 7 smart steps to switching your car insurance
- The true cost of not maintaining your car
- 5 DIY tips to save money on auto-body repairs
- 5 ways to avoid overpaying for car repairs
- Replace 5 car parts for better gas mileage