Tanks for nothing: Parents shouldn't pay all expenses

If teens aren't complaining about the gas crunch, they should be, financial-literacy experts say. Teens filling up with Mom or Dad's gas card don't see any reason to conserve, since the money isn't coming out of their pockets.

"They couldn't care less about gas prices," said Neale Godfrey, author of "Money Still Doesn't Grow on Trees: A Parent's Guide to Raising Financially Responsible Teenagers and Young Adults." "Why should they? They're not affected by it. Parents are paying big bucks for kids to go tooling all over the place in these big cars."

Godfrey, founder of the Children's Financial Network, believes teens should pay for gas, insurance and car repairs, supplementing their income with extra home chores.

To which Beckah Todd, 17, scoffs, "Yeah, right." She makes $100 every two weeks and spends $20-$25 a week on gas. "I basically pay to go to work," said the Lake Washington High School student. She drives her mom's old car, a Toyota Corolla, with her mom footing her insurance (with a good-student discount) and most repairs if Todd can't fix it herself.

"There's no way I'd be able to pay for insurance. It's too much," she said. "If they're trying to get teens off the road by making everything so expensive, it's working."

Other teens agreed some peers get too much parental help.

"I do believe kids should pay for their own stuff," said Lucas Aguilar, 18. "Some people I know hit up their parents to the hilt."

His parents pay for his insurance, but he bought his own old trucks and fills the tanks. Playing football cuts into his available time, but "I'm a working kid," said the Inglemoor High School student. "You gotta learn sometime."

Personal investment in a car helps teach responsibility and money management, said Nicole Schmauder, executive director of the Wenatchee-based Consumer Jungle, which promotes consumer literacy. "It's good for students to learn to cut back, just like their parents probably are."

Parents need to let teens feel the pinch of rising gas costs so they understand outside factors can and will impact their finances, experts say. This helps prepare them to deal with unforeseen and unwelcome future events, from job layoffs to tax increases.

"If teens are handed everything, don't work for it and aren't learning tradeoffs, then yes, it's a disservice in the long run," Schmauder said. "Owning a car is an ongoing process, so the sooner they learn the responsibility, the better."

Before students start driving, parents and teens should negotiate who pays for what, she said. "Understanding the total cost helps with the discussion early on about how much you can afford as a family."

That might mean saying no to car ownership.

"With rising gas prices coupled with expensive insurance, it's becoming increasingly difficult for teens to be able to support a car on their own," noted Jeff Southard, co-president of Jump$tart Washington, a local affiliate of the National Jump$tart Coalition for Personal Financial Literacy. "Generally, it's not a wise financial choice for a teen to have their own car when you consider the costs."

On average, families will pay $100 a month to add a teen to a parent's policy with a good-grade discount, plus $50 a month for maintenance and parking, Southard said. Figuring $30 for one tank of gas a week, that's an additional $120.

A part-time job at $7.35 an hour for 15 hours earns a student around $90 per week after taxes, Southard said. "This means students are spending more than 50 percent of their income on car stuff" — and that's assuming teens aren't making monthly payments, too.

Some 40 percent of teens ages 16 to 17 own a car, and that rises to more than half of 18- to 19-year-olds, said Rob Callender, trends director of Teenage Research Unlimited, which released figures this fall.