Owning a Car: How old do you have to be?

How old do you have to be to own a car? The answer might disappoint you. Most of the time, minors can’t obtain an auto loan or purchase insurance. A minor can own a car, but they’ll need the help of a parent or guardian to register it and get their state’s minimum requirement for insurance coverage.

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A former insurance producer, Laura understands that education is key when it comes to buying insurance. She has happily dedicated many hours to helping her clients understand how the insurance marketplace works so they can find the best car, home, and life insurance products for their needs.

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Written by Laura Berry
Former Insurance Agent Laura Berry

Joel Ohman is the CEO of a private equity backed digital media company. He is a CERTIFIED FINANCIAL PLANNER™, author, angel investor, and serial entrepreneur who loves creating new things, whether books or businesses. He has also previously served as the founder and resident CFP® of a national insurance agency, Real Time Health Quotes. He has an MBA from the University of South Florida. Jo...

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Reviewed by Joel Ohman
Founder & CFP® Joel Ohman

UPDATED: May 4, 2022

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Here's what you need to know...

  • Minors can have their name on the title of a car in most states
  • Teens and children can’t be legally held to a contract they’ve signed, which is why auto loan lenders won’t work with minors
  • Teens can’t register a car until they reach a certain age, which depends on the state but is usually 18
  • In order to register and drive a car, teens must purchase the minimum required insurance, and most insurance companies won’t sell a policy to a minor

For many kids, owning their first car ranks as one of the most exciting parts of growing up. A car means more freedom than ever before, but it also comes with a lot of responsibility.

That responsibility makes a lot of people wonder, “How old do you have to be to buy a car?” Between school, jobs, extracurricular activities, and hanging out with friends, it’s easy to see why teens are anxious to get behind the wheel.

Unfortunately, it can be very difficult for a minor to purchase their own car. Not only do teens need help purchasing a car, they will also need assistance with either purchasing liability auto insurance, which is required in most states.

Because of the difficulty, most teens need to wait until they’re 18 before they can legally buy a car.

So, how old do you have to be to own a car? One of the vital components of owning a car is having a car insurance policy. If you’re ready for car ownership, enter your ZIP code into our free tool to see what insurance quotes might look like for you.

Can a minor own a car?

First, a distinction: buying and owning a car are two separate things.

Minors can own a car, but buying a car can be incredibly difficult. Of course, it depends on the state, but ownership of the car is little more than a name on the title. In some states, an infant can be listed as the owner of a vehicle.

This means that you can purchase a car for a teen as a gift and have the title in their name the second they’re ready to drive. However, there are age requirements for registering a car.

How old do you have to be to register a car?

When you register a car, you’re entering your vehicle into your state’s tax office. When your car is registered, it’s been verified as street safe.

Like the rules around owning a car, the age required to register a car depends on the state you live in. Most states allow you to register a car at age 18, though there are some exceptions. For example, Nebraska and Alabama have set the age at 19.

So, why can a minor be on the title of a car but not on the registration? Registering a car means you’ve paid your taxes on the vehicle and that you have your state’s minimum requirements for insurance.

Insurance is where teens run into trouble. Insurance is a legally binding contract between the driver and the company. Since minors can’t be held to a contract, most insurance companies won’t offer them a policy.

When a minor wants to own a car, a parent or guardian will likely need to get involved.

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How does a minor get insurance?

Minors can apply for insurance and have a policy on their own car, but since it’s a contract, it will require a parent or guardian’s signature to take effect.

While a minor can get a policy of their own with this signature, it will be much cheaper to join a parent or guardian’s policy. Teens are inexperienced drivers, which means that car insurance companies consider them high-risk drivers. Some of the highest rates for insurance apply to teens.

Age and genderAnnual cost for teenAnnual cost for teen added onto a parent's policy
16, female$6,562$3,086
16, male$7,483$3,428
17, female$5,490$2,915
17, male$6,357$3,243
18, female$4,772$2,687
18, male$5,606$3,003
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As you can see, teens pay much higher prices than drivers with more experience.

How can teens save money on insurance?

Whether they are on their own policy or a parent’s, there are several ways a teen can save money on insurance.

Most insurance companies offer discounts for young people. If you’re unsure about what your insurance company offers, you should ask your agent.

DiscountEligibilityCompanies that offer
Good studentMaintain a "B" average or have high standardized testing scoresState Farm, GEICO, Progressive, Allstate, Farmers, Nationwide
Defensive driving courseComplete a defensive driving course approved by your companyAllstate, American Family, GEICO, Farmers, Liberty Mutual, State Farm, Nationwide, Travelers
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To save money, it’s vital that you take advantage of as many discounts as you can. For example, the good student discount can save teens and parents up to 36% on their monthly bill.

Can a 16-year-old buy a car?

Once again, teens run into the problem of legal contracts when it comes to buying a car. Lenders won’t give a minor a loan for a car because that loan is a binding contract. Wondering, “Can you buy a car at 17?” the answer is still no.

Since a minor can’t be held legally accountable for the terms, a dealership would have no choice but to accept the vehicle back and return their money if a minor decided they no longer wanted the car.

All the risk of the loan is on the lender. That’s why you won’t find lenders that are willing to work with minors.

Even if you work a full-time job, you won’t be able to purchase a brand-new car until you’re 18. You can fund the purchase of your car, of course, but the loan will have to be in a parent’s name. Your parent or guardian can cosign a loan for you to mitigate the risk the lender has to take.

Can you buy a car at 16 with cash?

Yes — from either a private seller or a used car dealer, you can purchase a car if you’ve saved the money. You will still run into problems with registration and insurance, but you can technically buy the car.

So, at what age can you buy a car? As soon as you are legally an adult — 18 in most states — and you can be held legally accountable for any contract you sign, you’ll be ready to purchase your own car.

If you own a car, it’s essential that you get your state’s minimum coverage. While minimum coverage varies by state, any insurance company you contact will know exactly what you need.

Can emancipated minors buy a car?

Emancipated minors are minors that have legal guardianship of themselves. These are teens that have been granted adult responsibilities. Emancipation allows them to rent an apartment, choose medical care, and sign up for school.

As an emancipated minor, you still have to attend school. You also can’t get married without your parent or guardian’s permission, and you’ll go to juvenile detention if you break the law.

There are three common ways you can be emancipated:

  • Marriage with your parent’s permission
  • Enlisting in the military with your parent’s permission
  • An order from a judge

As an emancipated minor, you can buy a car, register it, and purchase an insurance policy in your own name. You can be legally held to a contract, so a lender will be willing to work with you.

Find the best insurance for teen drivers

Getting your first car should be a time of excitement and joy, but you can quickly get bogged down in the technicalities of ownership. A parent or guardian can make the process of getting a teen behind the wheel of a car much easier by purchasing the car or cosigning a loan.

Now that you know how old you have to be to own a car, your next step is to find insurance. Enter your ZIP code into our free tool today when you’re ready to see what quotes might look like for you.

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