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Car Depreciation Calculator

AutomotiveVehicle Ownership Costs

Share of the remaining value lost per year; 15% is a common middle figure for a typical car.

Estimated value at the end —
Total value lost
—
Share of price kept
—
Average loss per year
—
Loss in the first year
—
Car value by year
The chart appears with your result

A car loses a share of its remaining value each year, so its value is price × (1 − yearly loss)^years. A $30,000 car losing 15% a year is worth about $13,311 after five years, keeping 44.4% of its price; the first year alone takes $4,500.

About this tool

Depreciation is usually the largest single cost of owning a car, larger than fuel or insurance for many new models, yet it never arrives as a bill. Buyers comparing a new car against a two-year-old one, owners deciding when to sell, and anyone budgeting the true cost per year can use this calculator to put a number on it. Enter the purchase price, how long you plan to keep the car and the share of value it loses each year. You get the estimated value at the end, the total and average loss, a year-by-year table and a line of the value falling over time. The yearly percentage is your assumption: real resale prices depend on make, mileage, condition and the used-car market, so treat the result as an estimate, not a quote.

How to use it

  1. Enter the price

    Type what you paid, or would pay, for the car.

  2. Set the years

    Use the − and + buttons to choose how long you keep the car, from 1 to 30 years.

  3. Set the yearly loss

    Drag the slider or type a percentage; 15% suits many mainstream cars after the first year.

  4. Read the table and chart

    Check the value at each year end and the line chart, which downloads as PNG, SVG or CSV.

Examples

$20,000 car, 20% a year, 3 years

Purchase price
20000
Years of ownership
3
Value lost each year
20

Result Estimated value at the end: $10,240.00
Total value lost: $9,760.00
Share of price kept: 51.2%
Average loss per year: $3,253.33
Loss in the first year: $4,000.00

  1. Share kept each year = 1 − 20% = 0.8
  2. Value = $20,000.00 × 0.8^3 = $10,240.00
  3. Value lost = $20,000.00 − $10,240.00 = $9,760.00
  4. Average loss per year = $9,760.00 ÷ 3 = $3,253.33

Each year the car keeps 80% of what it was worth the year before, so after three years 0.8 × 0.8 × 0.8 = 51.2% of the price is left.

$30,000 car kept 5 years at 15%

Purchase price
30000
Years of ownership
5
Value lost each year
15

Result Estimated value at the end: $13,311.16
Total value lost: $16,688.84
Share of price kept: 44.4%
Average loss per year: $3,337.77
Loss in the first year: $4,500.00

  1. Share kept each year = 1 − 15% = 0.85
  2. Value = $30,000.00 × 0.85^5 = $13,311.16
  3. Value lost = $30,000.00 − $13,311.16 = $16,688.84
  4. Average loss per year = $16,688.84 ÷ 5 = $3,337.77

The first year costs $4,500 in lost value; by year five the yearly loss has shrunk because it is taken from a smaller balance.

$40,000 car after its first year at 25%

Purchase price
40000
Years of ownership
1
Value lost each year
25

Result Estimated value at the end: $30,000.00
Total value lost: $10,000.00
Share of price kept: 75%
Average loss per year: $10,000.00
Loss in the first year: $10,000.00

  1. Share kept each year = 1 − 25% = 0.75
  2. Value = $40,000.00 × 0.75^1 = $30,000.00
  3. Value lost = $40,000.00 − $30,000.00 = $10,000.00
  4. Average loss per year = $10,000.00 ÷ 1 = $10,000.00

A steep first-year drop: a quarter of the price, $10,000, is gone in twelve months.

How it is calculated

V = P × (1 − d)ⁿ

V
estimated value after n years
P
purchase price
d
share of value lost each year, as a decimal
n
number of years owned

This is declining-balance depreciation: each year's loss is taken from what the car is still worth, not from the original price. That is why the dollar loss is largest in year one and shrinks afterwards, which matches how used-car prices behave. The total loss is P − V and the average loss per year is that total divided by n. The calculator applies one constant percentage to every year.

When not to use it

  • For a tax deduction on a business vehicle, which follows official depreciation schedules, not market value.
  • For a quote on a specific car, where a dealer appraisal or listings for the same model and mileage are better evidence.
  • For classic or collectible cars, which can hold or gain value.

Common mistakes

  • Applying the yearly percentage to the original price every year, which overstates the loss in later years.
  • Using a first-year drop of 20% or more for every year of ownership.
  • Ignoring high mileage, which can push a car's value well below a typical curve.

Frequently asked questions

How much value does a new car lose in its first year?

First-year drops of roughly 15% to 25% are commonly cited for new cars, with luxury models often at the steep end. To model that, run one year with a higher percentage, then run the remaining years from the resulting value with a lower percentage.

Why does the yearly loss in dollars get smaller over time?

The percentage is taken from the current value, which keeps falling. At 15%, a $30,000 car loses $4,500 in year one but only about $2,349 in year five, because by then it is worth about $15,660 at the start of that year.

What yearly percentage should I enter?

For a mainstream car after its first year, 10% to 15% is a reasonable starting range. Trucks and models with strong reliability records tend to hold value better; luxury cars and electric models with fast-changing technology have often lost value faster. Checking used listings for the same model at several ages gives a better figure.

Is it cheaper to buy a car that is a few years old?

Often, because the first owner absorbs the steepest part of the curve. Comparing a new car run from year zero with a three-year-old car run from its current price shows how much depreciation each would cost you over the years you plan to keep it.

Does mileage change the result?

The calculator does not take mileage directly. If you drive much more than average, enter a higher yearly percentage, since high-mileage cars usually sell for less than the same model with typical use.

How do I find the percentage from two known prices?

Divide the later value by the earlier one, take the n-th root for n years between them, and subtract from 1. A car that fell from $30,000 to $15,000 in four years kept 0.5^(1/4) ≈ 0.841 a year, a loss of about 15.9% a year.

Cite this tool

Using this tool in an assignment, article or report? Copy a citation, or a link for your website.

APA

Tools Directory Editorial Team. (2026, October 9). Car Depreciation Calculator. Tools Directory. Retrieved October 26, 2026, from https://tools.milunir.com/automotive/vehicle-ownership-costs/car-depreciation-calculator/

MLA

Tools Directory Editorial Team. “Car Depreciation Calculator.” Tools Directory, 9 Oct. 2026, https://tools.milunir.com/automotive/vehicle-ownership-costs/car-depreciation-calculator/. Accessed 26 Oct. 2026.

Chicago

Tools Directory Editorial Team. “Car Depreciation Calculator.” Tools Directory. Last modified October 9, 2026. Accessed October 26, 2026. https://tools.milunir.com/automotive/vehicle-ownership-costs/car-depreciation-calculator/.

Link<a href="https://tools.milunir.com/automotive/vehicle-ownership-costs/car-depreciation-calculator/">Car Depreciation Calculator – Tools Directory</a>