Tuesday, November 18, 2014

Welcome to the Real World, Part 2

Last week I introduced you to a co-op class I taught to high school students- 'Welcome to the Real World'.

The second lesson for the students was purchasing a car.

I introduced this lesson by asking the students, "What is the purpose of a vehicle?"

I had some savvy students, so they knew the answer I was looking for (to get you where you are going), even though some gave the answer that the car companies want us to believe:  to look cool, for prestige.

We discussed the advantages of buying a used car for cash rather than buying a new car with a loan.  

I touched briefly on loans and interest, as well as the total cost of the car with interest.  Loans and debt is a topic we discussed several different times over the semester.

We also talked about insurance requirements and the cost of insurance.  When you own the car, you are only required to have liability insurance therefore saving money.

I printed some 'play' money and each student randomly received $3000, $4000, or $5000 to purchase a vehicle.

The homework requirement was: 
1.  Decide if you are going to buy with cash or get a loan

2.  Find  3 vehicles you can afford with your 'cash'

3.  On a chart, fill in the details about the car

4.  Find out how much insurance will cost per year, factor that into the total cost of the vehicle

After doing the research, students chose the car they could afford and turned in that information the next week.

car comparison lesson
If you are doing this project at home with your student, you could have your student call about the car and actually go see it and drive it.  Many used cars listed on Craigslist (or similar sites) are bogus or not as good as they sound in the ad.  This would give you an opportunity to teach your student what to look for when considering a used vehicle.

Next week: Part 3


Jackie Ryan Masek said...

What an excellent assignment for high school kids! Most adults still don't know understand the best ways to buy a car. I certainly was never taught in school. This lesson will be added to our plans this year. Thank you!

karentrina said...

I was fortunate that my parents demonstrated making wise financial decisions and living debt free.

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