Promised My Son We’d Match His Car Savings, Now He Has More Than We Expected

The user (46M) and his wife made a promise to their 18-year-old son to match whatever he saved for a car upon his high school graduation. However, their son saved a surprising $35k, largely due to some stock market luck, and now insists on using that amount.

While they are financially capable of matching it, they are concerned that purchasing a $70k car for their son is a bad idea, given his age, the limited use of the car, and the high insurance costs. They are torn between fulfilling the promise and potentially facing resentment, or breaking it for what they believe is his own good.

‘ Promised My Son We’d Match His Car Savings, Now He Has More Than We Expected ‘

When he turned 16 and got his license, we allowed him to use an old car from a relative. At that time, my son had around $5k in savings. We made him a promise saying that we’d match whatever he ended up with at graduation.

Reasonably, we thought he’d maybe double that to $10k through jobs and we’d match for a reasonable $20k car. He now has $35k to use for a car. He said he did have a little over $10k but that he bought smart stock options in April and now will have around $35k after tax (personally I don’t think he did anything besides get stupid lucky).

He is insisting that we follow through with our promise and match that. Financially, it’s not a huge dent for us since he also surprised us with a nice merit scholarship (that he did earn).

The problem arises in that we really don’t want to break the promise we made to him, but we also strongly believe that an 18 year old driving around in a SEVENTY THOUSAND DOLLAR car is a very bad idea.

e can’t even take it to school until his sophomore year, and the insurance on that will be a nightmare. What I am asking is, would the better course of action be to break the promise, and likely face resentment? Or keep it and cough up the money?. Thanks in advance for the advice.

Here’s what the community had to contribute:

MuppetStar −  Personally a $70k car is a lot for an 18 year old. I’d match the $10k and put the $15k towards a house deposit for him – you honour the money match but don’t put so much to a car, which will depreciate and lose value.. The tough bit would be the sell!

LionWalker_Eyre −  Having saved up $35k at 18, with the possibility of that being $70k, and having a full-ride scholarship, puts him in a better financial position than probably 99.9% of his peers. I would try and talk through that with him, but I guess an 18 year old who wants to buy a $70k car has different priorities than that..

[Reddit User] −  Be a parent and tell him the truth? He’s your son, not a mafia godfather

seanprefect −  I can say that a 70K car with an 18 year old driver … you’ll be lucky to get insurance and even if you do it’ll be stupid high.

d0n7w0rry4b0u717 −  It’s incredibly irresponsible to use all his savings on a car. Even at 18, a $20k car is more than enough. Keep your word and match his savings (since you can afford to do so), but don’t put it towards a car.

Put it in a high interest savings account for him as emergency/house savings for the future (or look into various low risk investments). He might be peeved about it now but I guarentee he’d be grateful for that after he graduates college. Most 18 year olds don’t understand financial responsibility.

At 18, if I had that kind of money I probably would have been an i**ot and bought some fancy car. I’m 24 now and understand a lot more about financial responsibility. I’d rather get a used $15,000 car and have extra money to grow my assets.

cfrules7 −  50k of that would be SO MUCH better off put in savings for his future. Buying a 70k car in cash is such an incredibly stupid idea…

megnificent12 −  I’m a big believer in keeping your word to your kids but in my view, enabling a decision that is financially irresponsible and potentially deadly is by far a worse parental sin.

I also don’t like that he obviously thought he was going to get one over on you, like you’d just magically conjure up an extra $25k. Give him the $10k and offer to help with insurance if you’re feeling generous.

Disgruntledballoon −  Two paths forward imo: Match what he earned from his job, not what he earned from external sources. This seems to be the spirit of what you intended and doesn’t reward him for what you consider “getting lucky” in the markets (not saying you’re wrong).

I’d just let him know that you only intended to match his job earnings, and you’re sorry that it was miscommunicated. Match the 10K towards a car and the remaining 25K in a separate growth account. Reward his investment with another investment. This way you follow through completely but don’t have to worry about him buying a 70K car.

JustinC411 −  Your kid is an i**ot if he’s saved up all that money and wants to blow it all on a car

ridin-derpy −  Damn, a lot of people aren’t reading your question thoroughly. You and your son are both surprised at how much he made in a short amount of time, so work with that. He’ll get where you’re coming from if you say, “wow we didn’t expect you to get that much money in such a short amount of time.”

Laugh about it together, and then give him a financial lesson about why it worked and how lucky it was. Then tell him that as his parents, it’s your responsibility to make sure he learns from this and makes a smart decision with the car too.

Tell him you’ll match the full $35K, but you won’t let him use it to buy a $70K car. The money is his, but 18 isn’t a magic age where all parenting stops. Talk to him about the value of a new-ish used car, and show him what he can get for $20k, vs $30k. Help him make a budget for gas, insurance, maintenance.

Then help him shop. Put the rest in a trust for him with conditions, and assure him that it is his money, but that it’s important to you that he get off on the right foot financially, so this is how it’s going to be.

If he has money left over from the $35k after buying the car, maybe talk to him about a smaller splurge ($2-3k) to celebrate the accomplishment, like a computer for school or something more fun.