$35,000 purchase, 15% year 1, 10% thereafter, 5 years
- Year 1 ≈ $29,750
- Year 5 ≈ $19,519
- Residual ≈ $19,519
finance calculator
Car Depreciation Calculator
Estimate your car’s value over time using a first-year drop and a steady annual depreciation rate for subsequent years.
Results
- Value by year
- 5.00
- Value at end of period
- $19,519
How to use this calculator
- Enter the purchase price.
- Enter first-year depreciation % and annual depreciation % for later years.
- Choose how many years to project.
- Review estimated values by year and the residual value at the end.
Inputs explained
- First-year depreciation
- Cars often drop more in the first year; set your estimate here.
- Later-year depreciation
- Annual drop applied after year 1.
- Years
- Projection length; common 5–7 years for ownership plans.
How it works
Year 1 value = purchase price × (1 − first-year depreciation%).
Each subsequent year reduces the prior year’s value by the later-year depreciation rate.
Outputs show value for each year and the residual value after the chosen period.
Formula
Year 1 value = Purchase × (1 − First-year %) Year n value = Prior year value × (1 − Later-year %) Residual = Value at final projected year
When to use it
- Estimating resale value when planning a future sale or trade-in.
- Budgeting ownership costs and equity for auto loans.
- Comparing models with different typical depreciation patterns.
Tips & cautions
- Luxury or EV models may depreciate faster/slower; adjust rates accordingly.
- Use conservative (higher) depreciation to avoid overestimating future value.
- Market conditions vary; this is a simple percentage model, not VIN-specific.
- Simple percent model; real depreciation varies by model, mileage, condition, and market.
- Does not adjust for mileage or major accidents/repairs.
- Yearly averages only; not for exact appraisal.
Worked examples
$50,000 purchase, 18% year 1, 12% thereafter, 6 years
- Year 1 ≈ $41,000
- Year 6 ≈ $21,637
- Residual ≈ $21,637
Deep dive
This car depreciation calculator projects your vehicle’s value year by year using a bigger first-year drop and steady annual depreciation afterward.
Use it to estimate resale/trade-in value and plan ownership costs over time.
FAQs
- Is mileage included?
- No. This is a simple percentage model. Actual values depend on mileage, condition, and market.
- Can I model faster early drops?
- Yes—raise the first-year % to reflect steeper initial depreciation.
- Does this include accidents or repairs?
- No. Those can materially affect value; this is a baseline projection.
- What about specific makes/models?
- Depreciation varies widely. Adjust rates to match typical patterns for your model.
- Trade-in vs private sale?
- Trade-ins can be lower than private sale; this gives a market-level estimate only.
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