Oh, the endless joys, frustrations and the sheer cost of raising children. Apart from the initial preparation for a baby, it’s fair to say the most expensive years are the teenage ones.
Both Caroline Peers, the CEO of Bleyer and myself have offspring at the age of both learning to drive and wanting their own car.
According to the BBC, “Passing your test takes, on average, 45 hours of lessons according to the Driver and Vehicle Standards Agency.” Now, that’s either paid for all on lessons or mixed with the extra insurance and risk of damage to one’s own car; both options not ideal.
“That’s likely to cost over £1,000. Add in the other expenses like exams and study materials and the final bill will be even higher.” (BBC) Then, there’s the constant bugging by said teenager to buy them a car. There’s the insurance, tax, MOT costs, servicing, petrol or diesel costs, not to mention the cost of repairing the car when it breaks/gets bumped/needs upgrading.
“After housing costs, a car is probably one of the most expensive things you’ll pay for as a young adult.” (The Money Advice Service) – in that case, why not make it easier for yourself?
Can Gold and Silver help with such expenses, for either our children or grandchildren?
The honest answer is yes and no. As all our readers are aware, the price of Gold and Silver can go down as well as up, especially over shorter periods of time.
To invest in Gold and Silver bars and coins as a means to cover the later costs of a child’s first car, we would recommend thinking long term. If the funds are needed within a year or two, it’s impossible to know what the price of Gold and Silver will do within that time frame.
For example, looking back over the last ten years:
The price of an ounce of Gold would have increased significantly more than leaving it in a savings account for the same purpose.
Looking closer, investing that same amount between 2007 and 2011 would have reaped even larger increases. But, on the other hand, looking at the last five years, such a plan would have incurred a loss:
But, if the Gold Car Savings Plan was started when the child was a toddler, then it is hard to see how the investment would not be a winner. This is because the price of Gold over the long term is a store of wealth:
Now, that’s impressive. A bank savings account simply cannot compare, because one is a currency account and the other is a timeless asset of inherent value as a safe haven metal.
So, maybe this is a quest for grandparents, as well as parents. How about saving one ounce of Gold for each child or grandchild now, so that when they reach 16 or 17 you can cash in the Gold to give them the skill of learning to drive or their first taste of freedom in their own car? It will be a gift they will never forget.
My son’s sixth form held a very difficult but essential talk recently by a visiting parent who had lost their son in a car crash. My son came home deeply moved but told me something that has stuck with me; regardless of whether I can do anything about it or not. He said that statistically, he’s more at risk as a passenger in a car with another young driver than driving himself. I can’t find these statistics myself but it is documented by Brake – the road safety charity – that risk-taking behaviour increases when more passengers are in the car. Young people take risks such as showing off to their peers, becoming distracted by their friends, driving more at night and decreasing their use of seat belts the more passengers are in the car with them.
We can never know what the best course of action is sometimes. Do we not buy them a car to try to keep them safe on public transport? Or do we buy them a car, to try to keep them safe by not being as tempted to get in a car with another less experienced driver? Either way, we hope this blog on thinking about whether putting a little investment away into Physical Gold and Silver might help ease the future financial burden, just a little.