20 yr old kid, no debt, also no credit.

Looking at financing a 7yr old truck. Has 20% down payment. Monthly payments would be around $300.

Insurance quote came back at $600 per month. Is this really where it's at?

That's exactly what we've been doing, minus the paper plates.

But it's time he buys a more reliable truck. The 89 F150 has been great and mostly reliable but old things need maintenance/repairs often.

Additionally, males under the age of 25yo pay a higher premium as insurance industry analytics show that they are more likely to have an at fault accident than other age groups.

Still $600 a month is incredibly high. My son, at 18yo, no debt, no credit, clean record, with a 2014 Mini Cooper S, was costing @$1500 a year every 6 months for full coverage. I did carry him on my insurance until he turned 25yo.

EDIT TO CORRECT

Insurance rates also follow the car, corvettes are notoriously cheap to insure and Scion Tcs are expensive.

I bet a Camry is cheap to insure

kids on my insurance (18 & 20) with a (2013 and 2010 Jeep Wrangler Unlimited) respectively are each ~$1,200 every six months.

Someone was telling me that if you can last with 2 cars (with 3 drivers) then rates don't change much for your teenage driver. Essentially, by adding a 3rd car increases the cost substantially. Haven't verified that, but almost makes me want to Uber and share cars vs pay the inflated costs.

Martin Q. Blank said:

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Look at 20 yr old truck. Pay cash. Paper plates with no insurance.

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That's what I did when I when I bought my first car before college but they still always fought every step of the way.

"We can't add this car because the title is your name and not your parents".
"We can't offer any coverage for this car due to the age"
"We won't cover that hit and run (Not at fault) because of your age group so you can pay out of pocket"
"If you go to college out of state we will have to issue seperate coverage in that state" (Despite state law saying students are not considered residents).
What's the point of buying if it won't bloody cover anything? At that point I'd rather just pay a 50,000 Sultry bond.

JB said:

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It's all a scam

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We buy insurance for the gamble. We are gambling that we'll need it and the carrier is gambling that we won't.

We've been more right than wrong and now vengeance will exacted.

I know it doesn't help now but good idea to get your kid a credit card at 18 to start building credit history as they will need it for everything.

Ie they have no history showing he is capable of paying his bills so they are going to charge more in case he doesn't

Jesus I'm getting raked over hot coal, barbecued, and pureed in a dull blender: insuring my wife and myself , over 40, same jobs, same location for 9 years, 830 credit, pay whole premium every time, 2 cars that are 2019 and newer, paid off, no tickets in 25 years of driving. Our bill is $1300 every 6 months.

My agent is claiming " inflation".

JBLHAG03 said:

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I know it doesn't help now but good idea to get your kid a credit card at 18 to start building credit history as they will need it for everything.

Ie they have no history showing he is capable of paying his bills so they are going to charge more in case he doesn't

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I was also wondering if this was the problem. It's stupid, but lots of companies, even background checks and security clearances, use the credit score.

To the idiots running these checks no credit score, which means no debt, is as bad as a bad score, with lots of debt.

Sad to say, but getting a credit card, and paying it off on time every month, is one route toward the scam of "building credit" and proving he is a good little drone.

When I was in my early twenties and needed a credit card, I was rejected because I had "no credit score". This was at the same time I was a full time farmer, and could walk into any business in town, and pick up several thousands of dollars worth of supplies without even signing the receipt.

So I borrowed $500 from the bank, put it in savings, and 90 days later, pulled it out and paid off the loan. Asked the bank to please report it, and boom, I had a credit score.

Dumb system, but that's how it goes.

Part of the problem is the system requires participants to defray costs, but due to inflation and torts, the cost has priced more and more people completely out, so you have fewer participants to diffuse the costs across, but also am increasing number of uninsured drivers to cause costly accidents with no meaningful recovery likely. This causes a death spiral of price inflation and fewer customers.

MouthBQ98 said:

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Part of the problem is the system requires participants to defray costs, but due to inflation and torts, the cost has priced more and more people completely out, so you have fewer participants to diffuse the costs across, but also am increasing number of uninsured drivers illegal aliens, er undocumented immigrants to cause costly accidents with no meaningful recovery likely. This causes a death spiral of price inflation and fewer customers.

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They're part of it, but there are also a huge number of citizens and legal residents not obtaining insurance now because they aren't held to account and have relatively little to lose, being young and probably in debt.

insurers also hold massive portfolios of bonds which are experiencing their worst 3-4 year period of performance in the last century. fortunately most insurers do a much better job of duration matching than banks, but they are still hurting financially. so we get to pick up the slack. its a great system!

MouthBQ98 said:

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Part of the problem is the system requires participants to defray costs, but due to inflation and torts, the cost has priced more and more people completely out, so you have fewer participants to diffuse the costs across, but also am increasing number of uninsured drivers to cause costly accidents with no meaningful recovery likely. This causes a death spiral of price inflation and fewer customers.

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Ding ding ding.

Increasing frivolous personal injury lawsuits.
Increasing uninsured motorists.

https://www.travelers.com/resources/business-topics/insuring/4-factors-causing-social-inflation

CanyonAg77 said:

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To the idiots running these checks no credit score, which means no debt, is as bad as a bad score, with lots of debt.

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I took out a couple of small installment loans when I was 18-20, but otherwise paid cash for everything. My rationale was (still is) if I can't buy it cash at that moment, I can't afford it. While I had a pretty decent score, my credit history was nearly nonexistent.

I didn't get a credit card till I was 25 or so when I realized a good credit score would help me when it came to buy a house. I got with my CU and got a card with a limit of $500. I would only use it to buy gas and would pay it off every 2x fill ups to keep credit utilization low.

I hate playing their game, but if I'm going to play it, I'm going to do my best to beat them.