Amortization for peak resale value....
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Amortization for peak resale value....
Let me start by saying I'm lazy. That's both good & bad. I'd probably be too lazy to sell my truck which would be good 'cuz I'll keep it & enjoy knowing that it's paid off etc.etc. The be part is that my lazy side would also be the one that goes & trades the damn thing in on an '04 & not worry about it 'til I got home & thought, "What the heck did I just do?"!
Anyway.........anybody ever broken down amortization on a vehicle (or in this case, specifically, 1/2-ton truck) to figure out exactly when peak resale value occurs for the years of use invested?? (I'm guessing it's gonna be somewhere around 8-10 yrs but I'm curious if there's a logic to it).
Here's my guess..................
I bought my truck new in spring of '98 for $24,000. Now, 5 years later, I'm guessing it's worth about $9-10,000, maybe $11-12,000 if I got really lucky. So I figure I've already eaten about $10-15,000 in depreciation.....(sickening)
......but, hey, that's how it goes. I can't imagine my truck would be worth any less than $5-6,000 in after the next 5 years so obviously depreciation slows SIGNIFICANTLY for the next 5 years of ownership. Does this sound 'bout right?? TIA
Anyway.........anybody ever broken down amortization on a vehicle (or in this case, specifically, 1/2-ton truck) to figure out exactly when peak resale value occurs for the years of use invested?? (I'm guessing it's gonna be somewhere around 8-10 yrs but I'm curious if there's a logic to it).
Here's my guess..................
I bought my truck new in spring of '98 for $24,000. Now, 5 years later, I'm guessing it's worth about $9-10,000, maybe $11-12,000 if I got really lucky. So I figure I've already eaten about $10-15,000 in depreciation.....(sickening)
......but, hey, that's how it goes. I can't imagine my truck would be worth any less than $5-6,000 in after the next 5 years so obviously depreciation slows SIGNIFICANTLY for the next 5 years of ownership. Does this sound 'bout right?? TIA
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Joined: Dec 2001
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From: Hazel Park, MI
Oh so you want me to think on my off semester huh? Bad you! (I'm an acconting student) 
Amortization & depreciation are 2 different thigs. Depreciation for peak resale would have to be determined by you since every pruchase is different for every person or company. When a company buys a large ticket item they figure out what the items useable life is, then what they think the book value will be at the end of the useable life (sometimes its 0 sometimes its not). Then there are several differnt ways to depreciate the item (some dep. the same amount each year, some are progressive).
I don't know if that makes any sense or even answers your question but uts what I know.
Amortization & depreciation are 2 different thigs. Depreciation for peak resale would have to be determined by you since every pruchase is different for every person or company. When a company buys a large ticket item they figure out what the items useable life is, then what they think the book value will be at the end of the useable life (sometimes its 0 sometimes its not). Then there are several differnt ways to depreciate the item (some dep. the same amount each year, some are progressive).
I don't know if that makes any sense or even answers your question but uts what I know.
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From: FL
Well, from a non acounting point of view, my experience is the longer you can drive a rig paid for, the more value you get from it. Another thing with dealerships is they won't give you squat for a rig after it clears 100K milage. I don't know about selling it, but I wouldn't buy a high milage rig unless I was a high school kid or something. Then I wouldn't be looking to pay over 2K for a rig. That's just me though.
I'm hoping to fight off the new car demons on my 99 XLT expi till I've driven it for 3 years paid for. That would put me at about 06-07 model year. Should be some neat stuff on the new ones by then
I'm hoping to fight off the new car demons on my 99 XLT expi till I've driven it for 3 years paid for. That would put me at about 06-07 model year. Should be some neat stuff on the new ones by then
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Hmmmm......so we can say that 100k miles is an 'x' factor, correct? Well, I'm sitting at 61,000 on my 98 right now so I'm guessing I can just BARELY go another 3 yrs on the same mileage schedule & possibly have a truck still worth something?? Or maybe go 2 years to keep it under 90k miles??