15-year Fixed-rate Mortgage Calculator

Standard Sedan (Average) Truck / Large SUV (Better Hold) Luxury Vehicle (Fast Drop) Electric Vehicle (Rapid Evolution)

Estimated Valuation

Current Estimated Value: $0.00

Total Value Lost: $0.00

Percentage of Value Retained: 0%

function calculateDepreciation() { var price = parseFloat(document.getElementById('purchasePrice').value); var age = parseFloat(document.getElementById('vehicleAge').value); var rate = parseFloat(document.getElementById('vehicleType').value); if (isNaN(price) || isNaN(age) || price <= 0 || age < 0) { alert("Please enter valid positive numbers for price and age."); return; } var currentVal = 0; if (age === 0) { currentVal = price; } else { // Formula: First year usually sees a 20% drop, then 'rate' thereafter var firstYearDrop = price * 0.80; if (age === 1) { currentVal = firstYearDrop; } else { currentVal = firstYearDrop * Math.pow((1 – rate), (age – 1)); } } var lost = price – currentVal; var percent = (currentVal / price) * 100; document.getElementById('currentValue').innerHTML = "$" + currentVal.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2}); document.getElementById('totalLost').innerHTML = "$" + lost.toLocaleString(undefined, {minimumFractionDigits: 2, maximumFractionDigits: 2}); document.getElementById('retainedPercent').innerHTML = percent.toFixed(1) + "%"; document.getElementById('resultsArea').style.display = "block"; }

Understanding Car Depreciation: What You Need to Know

Depreciation is the difference between what you paid for your car and what you can sell it for today. For most vehicle owners, depreciation is actually the single largest expense of car ownership—often costing more than fuel, insurance, or maintenance.

How Car Depreciation Works

A new car loses value the moment it leaves the dealership lot. On average, a new car loses about 20% of its value in the first year. Over the next four to five years, it typically loses about 15% of its remaining value annually. By the end of year five, many cars are worth only about 40% of their original sticker price.

Key Factors Influencing Resale Value

• Mileage: The more you drive, the lower the value. High mileage suggests more wear and tear on the engine and transmission.
• Condition: Both mechanical health and interior/exterior cleanliness play a huge role in the final sale price.
• Brand Reputation: Brands like Toyota and Honda historically hold their value better than luxury brands like BMW or Mercedes, which face high maintenance costs as they age.
• Market Demand: Currently, SUVs and Trucks depreciate slower than sedans because consumer demand for larger vehicles is higher.

Realistic Example of Depreciation

Let's look at a realistic scenario for a mid-sized sedan:

• Purchase Price: $30,000
• Year 1 (20% drop): $24,000
• Year 2 (15% drop): $20,400
• Year 3 (15% drop): $17,340

In just three years, the owner has "spent" $12,660 in value, even if the car is in perfect condition.

How to Minimize Your Loss

To reduce the impact of depreciation, consider buying a "lightly used" vehicle that is 2-3 years old. By doing this, the previous owner absorbs the steepest part of the depreciation curve (the 20% first-year drop), while you get a modern vehicle at a significantly lower price point.