Car Depreciation Calculator
Enter a vehicle's purchase price, a first-year depreciation rate, and an ongoing annual rate, and this calculator projects a year-by-year value curve for the horizon you choose. It uses a two-stage declining-balance model — a steep drop in year one, then a compounding annual decline on the shrinking value — and reports the total dollars lost and the percentage of the original price gone. It is a generic model for planning, not a valuation of any specific vehicle.
Vehicle & depreciation
Value after 7 years
$9,655.03
from $32,000.00 paid
Total depreciation
$22,344.97
Percent lost
69.83%
Year-by-year value
Projected value curve
How it works
The model works in two stages. Year one applies the first-year rate to the purchase price, because a new car loses the largest share of its value the moment it is driven off the lot and over its first twelve months. Value after year one equals price × (1 − first-year rate). With a $30,000 car and a 20% first-year rate, that is $24,000 at the end of year one.
Every year after the first compounds the annual rate on the remaining value, not on the original price. So each year's value equals the previous year's value × (1 − annual rate). At a 15% annual rate, the $24,000 car is worth $20,400 after year two and about $17,340 after year three. This declining-balance approach mirrors how real resale values fall fastest early and then flatten out.
The chart plots the full value curve over your chosen horizon, and the summary shows total depreciation — purchase price minus the final projected value — along with that loss as a percentage of what you paid. The per-year table breaks out each year's value and the dollars lost that year, so you can see where the steepest drops land.
Frequently asked questions
Why is the first year so much worse than later years?+
New cars typically lose the biggest chunk of their value in the first year, and much of that on day one, because a car stops being 'new' the instant it is sold. Industry estimates commonly put first-year loss around 20% or more, with the decline slowing in later years as the car settles into the used market. That is why this tool uses a separate, higher first-year rate before switching to a gentler annual rate.
What depreciation rates should I enter?+
Real depreciation varies enormously by make, model, trim, mileage, condition, region, and demand. Trucks and some SUVs hold value far better than luxury sedans or EVs, and a high-mileage year depreciates faster than a low-mileage one. The defaults here are round-number rules of thumb, not a forecast for your car. For a specific vehicle, check historical resale data for that exact model and adjust the rates to match.
Is this the actual value of my specific car?+
No. This is a generic mathematical model, not a valuation of a specific VIN. It does not know your car's options, service history, accident record, local market, or how well you maintain it. Treat the output as a planning estimate for budgeting or comparing scenarios. For an actual number, use a dealer appraisal or a pricing guide that looks up your exact year, make, model, mileage, and condition.