Should I get a loan for my dd

[notthisagainforest]

My daughter is 22 and has a good job. She lives at home and has had an accident in her car that wasn't her fault. The car is a write off. She wants to buy an Audi a1 She has applied for a ten thousand loan and the interest rates are very high. I could get a low interest loan with my bank and give her the money. She would pay me each month for 4 years. I don't earn a high salary and I don't have any debts atall. Would you do this for your daughter or would you let them take the loan out in their name at a higher rate ? She hasn't asked me but I'm thinking of offering but I don't know if this is the right thing to do. Please advise.

I'm just asking for advice I'm not looking for insults. Thanks

If she wants the car, let her buy it. With her money, not yours. There are actuarial reasons why a 22 year old is offered high rates of interest. Let her learn with her money about the impact of depreciation and high interest rates. It will be a valuable life lesson for her.

Yes I do recognise its up to her it's her money and she works hard. But I know it's not the right thing to do. I suppose all I can do is advise her the best I can which is what I've always tried to do. I won't be taking out the loan for her after hearing all the replies.

If shes good with money I'd certainly consider it.

However I'd be more comfortable to give her savings, rather than take out a loan. So if you've not got the savings, I would hesitate tbh.

Doesn't matter how hell bent on it she is, don't finance it for her.
Dissuade her, or let her make her own mistakes

If she's paying her way with rent and utilities I don't think there's much you can do.

You've offered advice and your opinion, but if your daughter is set on buying this car you can't stop her. Unfortunately it will be a decision she'll regret.

Personally I don't believe in buying anything on tick

I agree with pp. I bought an Audi A5 when I was 21 and I spent a small fortune getting things repaired. The cars themselves aren't necessarily expensive but it's the upkeep of them that costs a fortune. A tyre alone costs £90-£100. I had a Corsa as my first car, was only 4K but it was the best car I ever had! I have a ford focus now and touch wood I haven't had any problems with this one either. I really would encourage her to buy a more affordable, reliable and low maintenance car. Tell her to shop around, there's lots of nice cars out there. If she's set on the Audi though then she should take out the loan herself imo.

If you take out a loan for this which is a non essential she may end up constantly looking to you for thing like a deposit and other things to bail her out of making silly financial mistakes.
Let her buy it herself, don't mention anything and let her learn her lesson.

Is she saving for a deposit?

The deposit will be in write off money. She hasn't got any savings but is getting a large bonus in March

I took out a similar loan at a similar age and definitely lived to regret it. At the time I was earning fairly good money and couldn't see how that would change. Fast forward a couple of years and I was married and pregnant with my first DC, my wages obviously suffered massively and we could no longer afford the repayment. We ended up having to get a DMP and it will take us so much longer to pay off now. Things might be ok financially for her now but you don't know what the future brings.

Hang on.... She earns 35k, but has no savings, despite living with you? And she is 'hell bent' on a 10k car, despite all of the above?

You're bonkers if you do, and a pushover. She needs a life lesson about working for what you want, and saving up for stuff like cars.

Lol. No, I wouldn’t be pandering to this at all. Up to her as she’s an adult but I’d certainly tell her my opinion (that it’s a stupid plan and shows her immaturity). I do understand your position though and it’s normal to want to protect your kids from making silly and expensive mistakes but sadly, it’s the fastest way they will learn.

4 years is a long time when you are 22. She will eventually need a deposit to move out, rent money etc.

Crikey 35k a year , lives at home and has no savings , I’d be seriously concerned if this was my child . What is she doing with the money @notthisagainforest

She can’t afford it so no. Or maybe she can but she’ll miss out on other things. Let her buy it herself and learn the lesson, cars depreciate so fast. If she complains about being broke point out what she could have bought with the car money- travel/deposit/fun with friends.

I’m the wrong person to ask though, a car to me is a piece of equipment like a drill or a frying pan with a purpose. No need for frills 😂

She buys clothes and goes out all the time. She also goes on lots of holidays gets her hair nails lashes done

I'd be more seriously concerned if she was unemployed to be honest

At the moment no she doesn't want to move out. Maybe in four years she would but the loan would be paid by then I guess

What if she wants to move in with a future partner or gets a job 300 miles away? Or just wants some independence? A lot can happen in 4 years.

How did she write off the previous one?

Honestly she has a decent enough salary to still do those things she likes but in a more appropriate budget so she can save, she really needs to learn now to put money away for a house, Pension etc.

Perhaps you could present this car as her first adult challenge of saving for something outright especially as the value will depreciate significantly as soon as she gets it, this is an indulgent splurge, she gains nothing.

It wasn't her fault someone went into her

Nope.

Like everyone else I think shes spending too much and if she wants to go ahead it's her own decision.

this.

If by some awful mischance the Audi got written off too she would have a loan to repay on a car she no longer has. She is 22, at that age unless you had rich parents most of us were driving around in our interim car, not a banger, but not dream wheels either! Driving a cheaper car ( and with much cheaper insurance costs) will give her the chance to save towards the car she wants.

Sorry, I meant OP would have a loan to repay.