In the life of a teenager, there's nothing quite as sweet as getting a driver's license. But there's also nothing quite as sour as learning how difficult and costly buying a car can be.

You have to feel sympathy for teenagers. They simply can't wait to transition into the adult world. Perhaps if they knew about the costs and responsibilities that await them, they might choose to wait a little longer.

Teenagers looking to buy their first cars have plenty of adult-sized obstacles to overcome. Here's a rundown of what the average teen can expect when she tries to buy that first auto.

Sticker shock

After being inundated with car commercials since birth, most teenagers can't wait to slip behind the wheel of a shiny new car. But the average minor doesn't have the financial means to buy one, especially when the cost of insurance, gas, and a down payment are factored into the equation. If she wants to try, a good rule of thumb is to put at least 20 percent down on a car, and take a loan with a term no longer than 48 months. Push those limits any further, and a teen increases the potential for future hardships as an adult.

Buy used, buy wisely

If a new car is out of the picture, the logical choice for a teen is a pre-owned vehicle. Because a used automobile with mechanical problems could wind up costing as much as a brand new one, a teen should consider a model from an automaker with a good reputation for building sturdy cars. Several sites on the Internet let you see a car's history if you have the Vehicle Identification Number (VIN). It's also essential that you visit a trusted mechanic for a thorough inspection on the car. It's well worth the upfront cost.

Establish credit

There are few lenders willing to take a chance on a teenager who doesn't have a track record of paying bills on time. If a teen wants to get a car loan, she'll need to establish a credit history. She can do this by getting a simple video store card, or even a credit card with a low maximum limit. If either of these methods is used for six months and bills are paid on time, a favorable credit score will be created.

Another option for establishing credit is to have a parent co-sign a loan. The downside to this route, however, is that if the teen defaults on the payment, the car loan becomes a parent's responsibility. And if the parent fails to pay, both parties' credit histories will become as tarnished as the rust on some used car fenders.

Congratulations go out to every teenager who successfully passes her driver's license test. But celebrate more prudently than buying a car. Such a purchase shouldn't be impulsive because it includes plenty of adult-world obstacles. By following the tips above, you can steer clear of financial trouble.

Published on May 6, 2007