Car Depreciation Calculator
Project a car's value year by year from its purchase price and yearly depreciation rates.
Value after 5 years
$14,616
That's $20,384 lost to depreciation — the car keeps about 42% of what you paid.
Total value lost
$20,384
Value retained
42%
| Year | Start | Lost | End value |
|---|---|---|---|
| 1 | $35,000 | −$7,000 | $28,000 |
| 2 | $28,000 | −$4,200 | $23,800 |
| 3 | $23,800 | −$3,570 | $20,230 |
| 4 | $20,230 | −$3,035 | $17,196 |
| 5 | $17,196 | −$2,579 | $14,616 |
How it works
New cars lose value fastest early on. This tool treats depreciation as a declining balance: the car loses a chunk in year one, then a steadier percentage of whatever it's worth each year after that. That's why the dollar loss shrinks as the years go by, even though the rate stays the same.
Enter what you paid, a first-year drop (often around 20%), and a yearly rate for the years after (15% is a reasonable default for a mainstream car). The calculator walks forward one year at a time, multiplying the remaining value by one minus the rate.
The table shows each year's starting value, how much it lost, and where it ends. At the bottom you get the final value, the total dollars gone, and the share of the original price the car still holds. Actual resale depends on mileage, condition, and how desirable the model stays.
Frequently asked questions
Why is the first year so much worse than the others?
A car stops being new the moment you drive it off the lot, and that 'new car' premium evaporates immediately. Most models shed roughly a fifth of their value in the first twelve months, then settle into a gentler, steadier decline.
What depreciation rate should I use?
There's no single right number, but 20% for the first year and 12–18% per year after is a common ballpark for ordinary cars. Luxury models and EVs often depreciate faster; trucks and a few cult favorites hold value better.
Does this include the interest I pay on a loan?
No — it only tracks the car's market value. If you're financing, your true cost of ownership also includes loan interest, insurance, and maintenance, which this tool leaves out on purpose to keep the depreciation picture clean.