function calculateDepreciationRate() {
// 1. Get input values using var
var initial = document.getElementById('initialValue').value;
var current = document.getElementById('currentResale').value;
var years = document.getElementById('ownershipPeriod').value;
var errorDiv = document.getElementById('errorDisplay');
var resultDiv = document.getElementById('resultBox');
// Reset display
errorDiv.style.display = 'none';
resultDiv.style.display = 'none';
// 2. Validate inputs
var initialNum = parseFloat(initial);
var currentNum = parseFloat(current);
var yearsNum = parseFloat(years);
if (isNaN(initialNum) || isNaN(currentNum) || isNaN(yearsNum)) {
errorDiv.innerText = "Please enter valid numbers for all fields.";
errorDiv.style.display = 'block';
return;
}
if (initialNum <= 0 || yearsNum initialNum) {
errorDiv.innerText = "Current Value cannot be higher than Initial Price for depreciation calculation (this would be appreciation).";
errorDiv.style.display = 'block';
return;
}
// 3. Calculation Logic
// Total Loss
var totalLoss = initialNum – currentNum;
// Retention Percentage (Total)
var retentionPct = (currentNum / initialNum) * 100;
// Compound Annual Depreciation Rate (CAGR formula adapted for loss)
// Rate = 1 – (Current / Initial)^(1/n)
var annualRateDecimal = 1 – Math.pow((currentNum / initialNum), (1 / yearsNum));
var annualRatePct = annualRateDecimal * 100;
// Monthly Cost
var totalMonths = yearsNum * 12;
var monthlyCost = totalLoss / totalMonths;
// 4. Update Result Display
document.getElementById('rateResult').innerText = annualRatePct.toFixed(2) + "%";
document.getElementById('lossResult').innerText = "$" + totalLoss.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('monthlyResult').innerText = "$" + monthlyCost.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2});
document.getElementById('retentionResult').innerText = retentionPct.toFixed(2) + "%";
// Show results
resultDiv.style.display = 'block';
}
Understanding Used Vehicle Depreciation Rates
When evaluating the true cost of owning a car, the "Used Vehicle Rate" usually refers to the rate of depreciation. Unlike loan interest rates which determine financing costs, the depreciation rate calculates how quickly your asset is losing value over time. It is often the single largest expense in vehicle ownership, exceeding fuel, insurance, and maintenance costs combined.
Why Calculate Your Vehicle's Depreciation Rate?
Using a Used Vehicle Rate Calculator helps owners and prospective buyers understand the financial trajectory of their car. By determining the annual percentage rate at which a vehicle sheds value, you can make smarter decisions regarding:
Resale Timing: Knowing when the depreciation curve flattens helps maximize resale value.
Lease vs. Buy Analysis: High depreciation rates favor leasing, while low rates favor buying.
Total Cost of Ownership (TCO): Accurately projecting future value loss allows for better budgeting.
How the Rate is Calculated
The depreciation rate is not linear; cars typically lose value fastest in the first year (often 20-30%) and then stabilize. This calculator uses a Compound Annual Growth Rate (CAGR) formula adapted for negative growth (depreciation) to provide an annualized percentage.
The Formula: Annual Rate = 1 – (Current Value / Original Price) ^ (1 / Years Owned)
For example, if you bought a car for $30,000 and it is worth $18,000 after 3 years, the calculator determines the compound annual rate required to reach that lower value, giving you a precise metric to compare against other vehicles.
Factors Influencing the Rate
Several variables impact how high or low your used vehicle rate will be:
Brand Reputation: Brands known for reliability (e.g., Toyota, Honda) typically have lower depreciation rates.
Mileage: Higher than average annual mileage accelerates the rate of value decline.
Condition: Physical wear and tear, accidents, or lack of maintenance records will spike the depreciation rate.
Market Trends: Shifts in fuel prices or consumer preferences (e.g., the shift to SUVs) can alter rates for specific vehicle types.
interpreting Your Results
0-10% Annual Rate: Excellent value retention. This is typical for rare cars, high-demand trucks, or vehicles bought at the bottom of their depreciation curve.
10-15% Annual Rate: Average depreciation for a well-maintained used vehicle.
15-25%+ Annual Rate: High depreciation. Common for luxury sedans or vehicles with known reliability issues. If your calculator shows a rate in this range, it may be financially advantageous to drive the vehicle until it is fully depreciated rather than selling it at a loss.