Car Depreciation in Singapore: Your Questions Answered
These are the questions people ask most often about car depreciation. Each answer is short; follow the links for the full detail.
What does a car depreciation calculation tell me?
Works out the yearly depreciation buyers in Singapore use to compare used cars.
What is the formula?
Depreciation = (price − rebates) ÷ remaining COE years.
What do I need to enter?
Price you pay (S$), PARF + COE rebate at end (S$), Years of COE remaining.
Is this financial advice?
No. It is a calculation tool. For decisions about loans or investments, compare official offer documents and consider speaking to a licensed adviser.
Can you show an example?
For example, with these inputs:
- Price you pay (S$): 120,000
- PARF + COE rebate at end (S$): 15,000
- Years of COE remaining: 9.5
the calculator returns:
- Annual depreciation: S$11,052.63
- Monthly depreciation: S$921.05
Any tips?
- Paying credit card bills in full avoids interest charges of around 27% a year or more.
- Check for early repayment penalties and processing fees before taking any loan.
- Keep three to six months of expenses in an easy-access account before investing aggressively.
Background
Inflation erodes buying power, so a savings goal set in today's dollars needs to be adjusted upwards for the years it will take to reach it. Singapore's core inflation has varied widely over the past decade, so it is worth testing a range of rates.
Compounding is the reason long-term saving works: returns earn further returns, so the growth curve steepens over time. The same maths works against you with debt, which is why credit card balances at around 27% a year grow quickly if only minimum payments are made.
An emergency fund of three to six months of essential expenses protects you from having to borrow at high rates when something unexpected happens. Once that buffer is in place, extra savings can go towards longer-term goals and investments.
Related calculations
- Profit Margin Calculator: Calculates profit, margin and markup from cost and price.
- Markup Calculator: Finds the selling price from cost and markup.
- Discount Calculator: Works out sale prices during Great Singapore Sale, 11.11 and other promotions.
- Split the Bill Calculator: Splits a bill evenly.
Try it yourself with the Car Depreciation Calculator.
Run your own numbers: Car Depreciation Calculator