Car Depreciation Calculator
See what your car will be worth each year you own it, how much value it loses, and what that costs you per year, month and km or mile.
0 for a new car. 1.5 is fine.
Gives the cost per km. Driving more than average makes a car lose value faster.
Typical: about 20% in the car's first year, then about 15% a year (a rule of thumb).
Used for the car's first year of life only.
Loses the same amount every year. Type, mileage and condition aren't applied, as you set the end value.
Typical factors on the yearly rate, not brand figures.
Set it to your country's usual figure.
Typical: +5%, 0, −10%, −20% on the value.
Adds what it's worth today.
Value each year: table and chart
| Year | Car age | Value lost | Value at end | % of price |
|---|
How your car's value is worked out
Each year the car loses a share of what it was worth at the start of that year.
- 1
Yearly rate
20% in year 115% a year after(typical curve)
- 2
Value after 5 years
30,000 × 0.80× 0.85^4= 12,528
- 3
Value lost
30,000 − 12,528= 17,47258% of the price
- 4
Cost of owning it
17,472 ÷ 5= 3,494 a year291 a month0.17 a km
Read more: the formula, a worked example, typical rates and what changes them
Depreciation is the value a car loses as it gets older. You don't pay it as a bill, but you feel it when you sell or trade in: the gap between what you paid and what you get back is often the biggest cost of owning a car. A car loses the most in its first few years, so the drop is a share of what it was worth at the start of each year, not a fixed amount.
The formula
value after the years = price × (1 − rate in year 1) × (1 − rate in year 2) × … × condition
typical rates: 20% in the car's first year of life, then 15% a year
rate used = typical or your rate × vehicle type factor × mileage factor
mileage factor = 1 + 0.5 × (your distance ÷ average distance − 1), kept between 0.5 and 2
straight line: value lost each year = (price − end value) ÷ years
value lost = price − value at the end; cost per year = value lost ÷ years
cost per km or mile = value lost ÷ (distance a year × years)
Worked example
With the starting inputs (shown in US dollars; they follow your currency) you buy a new car for $30,000, keep it 5 years and drive the average 20,000 km a year, so the mileage factor is 1. On the typical curve it is worth $30,000 × 0.80 = $24,000 after year 1, then × 0.85 each year: $20,400, $17,340, $14,739 and $12,528.15 after year 5. That is $30,000 × 0.80 × 0.854.
It has lost $30,000 − $12,528.15 = $17,471.85, or 58.2% of the price. Spread over 5 years that is 17,471.85 ÷ 5 = $3,494.37 a year, 3,494.37 ÷ 12 = $291.20 a month, and 17,471.85 ÷ 100,000 km = $0.17 a km. The average drop is 1 − (12,528.15 ÷ 30,000)1/5 = 16.0% a year, and the car is worth half its price after 3 years 11 months.
A 3-year-old example of the same car would cost about $30,000 × 0.80 × 0.85² = $17,340. Kept 5 years (from age 3 to 8) it loses $17,340 × (1 − 0.855) = $9,646.15, which is $7,825.70 less than the new car loses.
Typical factors used
| Setting | Effect on the yearly rate or value |
|---|---|
| Mainstream car | rate × 1 |
| SUV or crossover | rate × 0.95 |
| Pickup or 4x4 | rate × 0.85 |
| Hybrid | rate × 0.95 |
| Luxury or premium | rate × 1.2 |
| Electric (EV) | rate × 1.25 |
| Driving 50% more than average | rate × 1.25 |
| Driving half the average | rate × 0.75 |
| Condition: excellent / good / fair / poor | value +5% / 0 / −10% / −20% |
What makes a car hold its value
- Models in steady demand, with a good reliability record, usually lose value more slowly.
- Lower mileage for the car's age, a full service history and a clean body and interior all help the price you get.
- Buying a car that is 2–3 years old lets the first owner take the steepest part of the drop.
- Keeping a car longer spreads the loss over more years, so the cost per year falls.
These are estimates from rules of thumb, not a valuation. Real prices depend on the model, the market where you sell, the time of year, fuel prices, new-car prices and incentives. For a real figure, compare listings for the same model, age and mileage near you. Fractions of a year are compounded within that year.
Common questions
How much does a car depreciate each year?
A common rule of thumb is that a car loses about 20% of its value in its first year and about 15% a year after that. On that typical curve a new 30,000 car is worth about 12,528 after 5 years, so it has lost about 58% of its price. Real cars vary with the model, demand, mileage and condition.
How do I calculate car depreciation?
Multiply the price by what is kept each year. With 20% lost in year 1 and 15% a year after, the value after 5 years is price × 0.80 × 0.85^4. For 30,000 that is 12,528. Take that from the price to get the value lost, 17,472, then divide by the years you owned it for the cost per year, 3,494.
Is it cheaper to buy a 3-year-old car than a new one?
Usually, because the steepest drop happens in the first few years. On the typical curve a car that costs 30,000 new is worth about 17,340 at 3 years old. Kept for 5 years, the new car loses about 17,472 and the 3-year-old car about 9,646, a saving of about 7,826 in lost value.
Does high mileage make a car lose value faster?
Yes. Buyers pay less for cars that have done more than the usual distance for their age. This calculator speeds up or slows down the yearly rate by half of how far your yearly distance is above or below the average you set, so driving 50% more than average makes the rate 1.25 times faster.
Do electric cars depreciate faster?
Many electric cars have lost value faster than petrol cars, partly because new models improve quickly and new-car prices and incentives change. As a typical setting, this calculator speeds up the yearly rate by 1.25 for an electric car. Pickups and 4x4s often hold value better, so they get 0.85. These are broad factors, not claims about any brand.
What is the total cost of owning a car?
Depreciation is often the biggest single cost, but you also pay for fuel or charging, insurance, maintenance and repairs, tax or registration and loan interest. Add your yearly figures in Advanced mode and the calculator adds them to the value lost over the years you keep the car, and shows the cost per year, month and km or mile.
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Made by Zulu Calculator, part of AlphaZulu LLC. Formulas are shown in full and rule figures are checked against official sources; see how we build calculators.