Depreciation Calculator
The short answer: depreciation is usually the biggest cost of owning a car — bigger than fuel — and it follows a curve you can sketch before you buy. Enter a price and a rate and this tool draws the year-by-year picture: value, total lost, and percentage kept, for up to 15 years.
Protect the value that's left
As factory warranties expire, one major repair can cost more than a year of depreciation. Extended warranty coverage is worth pricing once you know your curve — read the exclusions carefully; we show them, we don't hide them. Warranty partners are the planned partners for this slot.
How this is calculated
Each year's value = previous year's value × (1 − rate). At $30,000 and 15%, that's $25,500 after year one, $21,675 after year two, and $18,424 after year three — check it against the table. The constant-rate curve is a simplification on purpose: it makes cars comparable. Real depreciation is front-loaded (our trade-in estimator uses that curve: ~80% kept after year one, then ~85% of the remainder yearly) and varies by model, mileage, and market. Use this for planning and for comparing a strong-resale model against a weak one at different rates — not as a promise about a specific car.
Frequently asked questions
How fast do cars depreciate on average?
Mainstream cars commonly lose around 15–20% of their remaining value per year in the early years — roughly 40–50% gone by year five — then the curve flattens. In-demand trucks and some hybrids have done better; luxury sedans and, at times, EVs have done worse. 15% is the reasonable middle preset here.
Why is real depreciation not a smooth curve like this?
Because the steepest drop happens the moment a new car becomes a used one — the first year commonly takes 20% or more — after which the yearly percentage shrinks. This calculator applies a constant rate to keep the projection simple and comparable across cars; our trade-in estimator uses the front-loaded curve instead. Treat both as planning sketches.
What can I do to slow depreciation?
Buy the depreciation someone else already paid for (a 2–3-year-old car), choose models with historically strong resale, keep miles near or below average, maintain documented service, and keep the car clean and accident-free. You can't stop the curve; you can absolutely pick where on it you stand.
Why does depreciation matter if I'm not selling soon?
Because it's usually the largest single cost of owning a car — bigger than fuel — and it decides your equity if the car is totaled or you need to sell. Insurance pays market value, not your loan balance; a fast-depreciating car on a long loan is exactly how owners end up underwater.