# Car Depreciation Calculator

URL: https://speedycalculator.com/calculators/finance/car-depreciation/
Last updated: 2026-10-25

> The car depreciation calculator estimates what your car will be worth after a number of years – using typical depreciation of about 20% in the first year and 15% a year after that – and how much value it loses in total and per year.

## Inputs

- Purchase price
- Age of the car (years)
- First-year depreciation (%)
- Yearly depreciation after year 1 (%)

## Results

- Estimated current value
- Total depreciation
- Value lost
- Average depreciation per year

## Formula

```
Value after year 1 = price × (1 − first-year rate)
Value after n years = price × (1 − first-year rate) × (1 − yearly rate)^(n − 1)
Depreciation = price − value
```

## Explanation

New cars lose value fastest in the first year (often 15–25%) and typically keep about 40% of their value after five years. Brand, mileage, condition and demand all matter – trucks and some Japanese brands hold value better than luxury sedans and EVs.

### How to use the Car Depreciation Calculator

- **Purchase price**
- **Age of the car**
- **First-year depreciation**
- **Yearly depreciation after year 1**

Results update as you type, and every field accepts the units shown in its menu.

### How it works

Enter the purchase price, the car's age (or years ahead) and the depreciation rates.

### Tips

- Use your real spending from bank statements rather than guesses.
- Automate savings so they happen before you spend.
- Revisit your plan once a year or after any big life change.
- Keep an emergency fund before investing for long-term goals.

### Common mistakes to avoid

- Underestimating irregular expenses such as car repairs, gifts and annual bills.
- Ignoring inflation for long-term goals.
- Taking on high-interest debt to fund wants.

### Inputs explained

FieldWhat to enterPurchase priceAmount in your currencyAge of the carIn yearsFirst-year depreciationIn %Yearly depreciation after year 1In %

### What each result means

- **Total depreciation** = [Purchase price] - [Estimated current value]
- **Value lost** = [Total depreciation]÷[Purchase price]×100

### Example values

How the main result changes when **Purchase price** changes and everything else stays at the example values above:

Purchase priceEstimated current value20,0008,352.130,00012,528.1540,00016,704.250,00020,880.2560,00025,056.380,00033,408.4

## Worked example

Inputs — Purchase price: $40,000; Age of the car: 5 years; First-year depreciation: 20 %; Yearly depreciation after year 1: 15 %.

Results — **Estimated current value = $16,704.20**; Total depreciation = $23,295.80; Value lost = 58.24 %; Average depreciation per year = $4,659.16.

## FAQ

**How much does a car depreciate per year?**
Roughly 15–25% in year one and about 15% a year after that.

**Which cars hold their value best?**
Pickup trucks, sports cars and reliable Japanese models.

**How can I reduce depreciation?**
Buy slightly used, keep mileage low and maintain the car well.

**What formula does the Car Depreciation Calculator use?**
Value after year 1 = price × (1 − first-year rate).