Even $4,000 is enough of a down payment to purchase a decent new car, as long as you don't mind taking on another loan. For instance, a new Honda Civic is a nice, solid sedan and has a MSRP of $19,000 - $24,240 depending on how many features you add.
At the mid level you're financing about $16,000 (and it will be you because high school students and college kids don't usually have enough of a credit history, never mind the income, to qualify for a loan.)
With an interest rate of 4.25 percent (the current national average) you're looking at $296.47 a month, every month, for five years.
And, what if the worst happens and there is a car accident? Hopefully your child walks away fine, but if the car is totaled and you're back at square one for transportation, and owe money on a car that devalued as soon as you drove it off the lot, was it worth the investment?
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