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Car Depreciation Calculator

Enter your vehicle's purchase price, estimated annual depreciation rate, and how many years you plan to own it to see its remaining value.

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Results

Value after period--
Total depreciation--
Percent of value lost--

Estimates only.

How it works

This calculator uses the declining-balance method: the car loses the same percentage of its current value each year, not a fixed dollar amount. That means depreciation is steepest in year one and slows as the car gets older.

Formula: Value = Purchase price x (1 - Annual rate)^Years. For example, a $35,000 car depreciating at 15% per year is worth $35,000 x (0.85)^5 = approximately $15,529 after five years.

New vehicles typically lose 15-25% of their value in the first year and around 10-15% per year thereafter. Luxury vehicles, electric cars, and high-demand models may depreciate more slowly. These are estimates only -- not financial advice.

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FAQs

How fast do cars depreciate?

A new car typically loses 15-20% of its value in the first year and around 10-15% per year after that. After five years most vehicles are worth roughly 40-60% of their original price.

Which cars hold their value best?

Trucks, SUVs, and certain Japanese brands (Toyota, Honda) historically retain more value. Luxury sedans and electric vehicles with rapidly evolving technology tend to depreciate faster.

Does mileage affect depreciation?

Yes. Higher mileage increases depreciation because it signals wear and reduces remaining useful life. The industry average is around 12,000-15,000 miles per year.

Is car depreciation tax deductible?

For business-use vehicles, depreciation can be deducted using IRS Section 179 or MACRS rules. Personal vehicle depreciation is not deductible. Consult a tax professional.

How does depreciation affect a car lease?

In a lease, you pay for the depreciation during the lease term. A car with a high residual value depreciates less over the lease period, resulting in lower monthly payments.