Published on October 12, 2016
he minute you drive off with a new car, it begins to lose value. All cars depreciate at a different rate. It’s important to understand your vehicle’s rate of depreciation before you sign any papers. A new car loses 11% of its value the moment you leave the lot.
During the first 5 years, it depreciates by 15-20% each year. After 5 years, that vehicle is worth 37% of what you initially paid. You can use a tool to figure out which car depreciates at what rate, but let’s take an example:
- Let’s say you want to purchase a new Nissan 370z at the original current market price of $29,873. Here, you stand at 100% true market value (TMV) and have 0 miles on the odometer.
- Just one minute later, you car has already lost $2,559 in market value. You stand at 91% TMV, and the price tag has already dropped to $27,314, and the odometer reads 000001.
- Fast-forward one year: 015000 on the odometer, your car’s TMV already depreciated $5,687 in that year. You stand at 81% TMV and your car’s value is now at $24,186.
- After 2 years, your car’s TMV stands at 69%, your car’s value lost $3,607 that year and the price tag sits at $20,579, with 030000.
- After 3 years, your car’s TMV stands at 58% and by the end of the third year, your car lost $3,173 in value, your odometer stands at 045000 and your car is now worth $17,406.
- At year 4, your TMV is 49%, and your car has lost $2,813 for that year. Approximately 060000 sits on your meter, and your car is now worth $14,593.
- Finally, year 5 after your initial purchase, you lose a total of $2,524 for that year. You stand at 40% TMV and your car’s new value is $12,069.
- At the end of the five years, your total depreciation sums up to $17,804, so you vehicle has depreciated by 60%.
If you or a loved one has been involved in a Florida car accident, you need a Fort Lauderdale personal injury attorney you can count on. Call us at 1-800-INJURED, so we can connect you to an attorney who will help you get the most of your benefits. Insurance companies will try to give you the bare minimum or what you should be entitled to. We a network of attorneys who are located all over Florida, ready to help you at anytime, so contact us at [email protected] or at 1-800-INJURED. Our medical centers are located all throughout Florida, are open late, and offer free transportation!