Car Depreciation Calculator
Project what a car will be worth after any number of years, how much value it loses each year, and how big the first-year cliff really is.
Car Depreciation Calculator: with the default inputs, value after the period is $14,616.
What you paid, including options — not the MSRP if you negotiated.
A new car typically loses about 20% in year one — much of it the moment it is titled.
Roughly 15% a year of the remaining value for a mainstream new car.
- Total value lost
- $20,384
- Share of the price lost
- 58.2%
- Lost in the first year alone
- $7,000The cliff — usually the single worst year of ownership.
- Average loss per year
- $4,077
- Average loss per month
- $340Depreciation is normally the largest single cost of running a car.
- Years to lose half its value
- 4
Assumptions
- Declining-balance depreciation: a separate first-year rate, then a constant rate applied to the remaining value.
- Average annual mileage and normal condition; no accident history, no modifications.
- Nominal dollars — no inflation adjustment, and no allowance for market shocks such as the 2021–22 used-car spike.
- The model has no floor, so very long horizons drive the value implausibly close to zero.
| Year | Value | Lost that year | Lost in total | % of price retained |
|---|---|---|---|---|
| 0 | $35,000 | $0 | $0 | 100% |
| 1 | $28,000 | $7,000 | $7,000 | 80% |
| 2 | $23,800 | $4,200 | $11,200 | 68% |
| 3 | $20,230 | $3,570 | $14,770 | 57.8% |
| 4 | $17,195 | $3,035 | $17,805 | 49.1% |
| 5 | $14,616 | $2,579 | $20,384 | 41.8% |
How this is worked out
The formula
Value after n years = P × (1 − f) × (1 − a)^(n − 1) for n ≥ 1 Value after 0 years = P P = purchase price f = first-year depreciation rate a = depreciation rate for each later year, applied to the remaining value Total lost = P − value; average monthly cost = total lost ÷ (n × 12)
Open How it’s calculated above to see this worked through with your own numbers.
What you enter
- Purchase price
- What you paid, including options — not the MSRP if you negotiated.in dollars · 0 or more · defaults to 35000
- First-year depreciation
- A new car typically loses about 20% in year one — much of it the moment it is titled.a percentage · from 0 to 90 · defaults to 20
- Depreciation each year after
- Roughly 15% a year of the remaining value for a mainstream new car.a percentage · from 0 to 90 · defaults to 15
- Years owned
- A number.from 0 to 30 · whole numbers only · defaults to 5
What you get back
- Value after the periodmain answer
- Total value lost
- Share of the price lost
- Lost in the first year alone
- The cliff — usually the single worst year of ownership.
- Average loss per year
- Average loss per month
- Depreciation is normally the largest single cost of running a car.
- Years to lose half its value
What this assumes
- Declining-balance depreciation: a separate first-year rate, then a constant rate applied to the remaining value.
- Average annual mileage and normal condition; no accident history, no modifications.
- Nominal dollars — no inflation adjustment, and no allowance for market shocks such as the 2021–22 used-car spike.
- The model has no floor, so very long horizons drive the value implausibly close to zero.
About this calculator
Depreciation is what a car costs you. Fuel, insurance and servicing are visible every month; the several thousand dollars a year quietly evaporating from the resale value are not, and for most owners they are the biggest line by a distance. This calculator applies a declining-balance model — a big first-year drop, then a steady percentage of whatever is left — and shows the value, the annual loss and the cumulative damage year by year.
The first-year cliff
A new car loses roughly a fifth of its value in the first twelve months, and a noticeable slice of that goes in the first few weeks, when the car stops being new and becomes used. That is the cliff. From year two onward the rate is gentler — around 15% of the remaining value each year — which is why the dollar loss shrinks even though the percentage does not. Five years in, a mainstream car has typically retained 40–45% of what it cost.
The default rates here (20% then 15%) reproduce that commonly-cited pattern: about 58% of the price gone after five years. Adjust them for the specific car, because the spread across models is enormous.
What moves the rate
- Buying used skips the cliff entirely. A two- or three-year-old car has already taken the worst of it, which is the single most effective way to cut the cost of driving.
- Reputation and supply. Models with strong reliability records and constrained supply hold value; heavily fleet-sold and heavily discounted models do not, because the "price" they depreciate from was never really paid.
- Mileage. Well above 12,000–15,000 miles a year accelerates the loss; well below it slows the loss but not the calendar.
- Fuel type and market shifts. Electric-vehicle residuals have been volatile as battery prices, tax credits and new-model pricing move; treat any single published rate for EVs with suspicion.
- Condition and history. An accident on the vehicle history report costs real money at trade-in regardless of repair quality.
How to use the output
Average loss per month is the number worth internalising before signing anything: it belongs in the running-cost column alongside fuel and insurance. Comparing that figure against a lease payment for the same car is the fairest quick check of whether the lease is priced reasonably.
Where this model breaks
Declining-balance depreciation is a smooth curve fitted to a lumpy reality. It has no idea about model refreshes, recalls, fuel-price shocks, or the used-car spike of 2021–22 when three-year-old cars briefly appreciated. Below about 10% of the original price it also stops being meaningful — old cars converge on a floor set by parts and scrap value rather than continuing to decay by a percentage. For a real number on a real car, check what your exact year, trim and mileage is actually listing for.
Frequently asked questions
▸How much does a new car depreciate in the first year?
About 20% is the usual figure for a mainstream new car, though it ranges from roughly 10% for models in short supply to over 35% for heavily discounted luxury cars and some EVs.
▸How much is my car worth after 5 years?
With the standard pattern — 20% in year one, then 15% of the remaining value each year — a car retains about 42% of its purchase price after five years. A $35,000 car is worth roughly $14,600.
▸Is depreciation really the biggest cost of owning a car?
For most newer cars, yes. Losing $5,000 of value in a year dwarfs fuel and insurance for a typical driver. It only stops dominating once the car is old enough to have little value left to lose.
▸Does buying used avoid depreciation?
It avoids the steepest part. A three-year-old car has already shed roughly half its value, so the remaining decline is both smaller in dollars and gentler in percentage terms.
▸Which cars depreciate the least?
Models with strong reliability reputations, limited discounting and constrained supply — historically some trucks, and Toyota and Honda mainstays. Heavy fleet sales and big new-car incentives are the reliable predictors of a fast fall.
Put this calculator on your own site
A working car depreciation, free for any site, with no ads and no sign-up. It resizes to fit wherever you paste it and updates itself as this page improves.
Paste this anywhere. It works on any site, carries no ads, never expires, and always shows the current version.
Car Depreciation Calculator by CalculateItNow
The page's own title. The clearest description of what the link leads to.
The credit line sits outside the widget on purpose, so it is a real link on your page rather than one buried in a frame. Please keep it — it is what pays for CalculateItNow staying free and ad-free. The script only resizes the widget to fit its contents; drop it and the widget still works.
Browse every calculator widget·How to add it to WordPress, Squarespace or Wix
Related calculators
The questions people ask next to a car depreciation.
Compare the true cost of leasing and financing the same car over the years you'll keep it, including mileage overage, the loan balance and resale value.
Estimate your monthly car payment from the price, down payment, trade-in, sales tax and fees, and see the total interest and true cost of the vehicle.
Calculate a car lease payment from price, residual value and money factor, split into depreciation, finance charge and tax, with the total cost of the lease.
Budget a whole road trip: fuel, lodging, food, tolls and vehicle wear, split per person, with the cost broken down by category.
Add up everything you own and everything you owe to get your net worth, home equity, liquid assets and debt-to-asset ratio, with the split charted.