Sunday, December 10, 2023

Dave Ramsey: You Shouldn't Buy a New Car for Your Kids, Here's Why - GOBankingRates

Parents generally take great pride in buying their child their first car — whether it’s to celebrate a graduation or as a way to welcome them into adulthood, a first car holds a great deal of meaning. But according to finance expert Dave Ramsey, the best thing you can do for your kids is have them buy their own car.

“When you buy new cars for teenagers, you’re setting them up for a life of ridiculous expectations,” he says. “Think about their future.”

“If you have enough cash set aside, you and your child could agree on a matching plan to help buy the car. Whatever your child saves, you’ll match.”

Teaching your kid financial responsibility is a key factor in setting them up for success — here are some other tips from Ramsey to give your kids a head start to win with money.

Make Your Money Work Better for You

1. Let them manage their own bank account

As your child becomes a teen, helping them establish a basic bank account is a great step toward building good financial literacy, and equips them with the needed skills to handle more substantial accounts as they grow older. It also promotes a strong sense of self-accountability — a debit card, for example, allows them to manage their money, and learn to account for their purchases.

2. Teach them the value of managing a budget

“Now is the time to get your teen in the habit of budgeting their income — no matter how small It is,” Ramsey explained on his website. “They should learn the importance of making a plan for their money...

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