Car Depreciation Calculator
See how a car loses value year by year, with a depreciation schedule and the total value lost.
How it works
Value after n years = price × (1 − depreciation rate)^n
This uses a declining-balance model: each year the car loses the same percentage of whatever it is currently worth, not of the original price. That is why the dollar loss shrinks over time even though the rate is constant. Real depreciation is front-loaded — the steepest drop happens in year one — so treat the early years here as conservative.
Worked example
A $35,000 car depreciating 15% a year is worth about $29,750 after one year and roughly $15,530 after five — around 44% of the original price retained, with about $19,470 of value lost.
Frequently asked questions
How fast do cars really depreciate?
A typical new car loses roughly 20% in the first year and about 15% each year after, ending near 40% of its original value after five years. Models with strong demand hold value better.
Why is buying slightly used often smart?
The first owner absorbs the steepest first-year drop. A one- to two-year-old car has already shed much of its depreciation while keeping most of its useful life.
What slows depreciation?
Lower mileage, a clean history, staying on top of maintenance, popular colors and models with a strong reputation for reliability all help a car hold value.
Related calculators
This calculator is for educational purposes. Double-check important results before acting on them.