It is a nice gesture but I won't be doing that with my kids. I believe that handing these kind of expensive things to a kid teaches them zero about the value of money and how much things cost. Besides, I think they'll be a lot more careful with the car and the insurance if they're the only ones who are responsible for it. Kids are too careless and they have no fear. I won't be allowing them to drive my car with my insurance. it'll never happen.
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