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Since motor vehicles lose value over time, the question you need to ask before you sign on the dotted line is: "what will this vehicle be worth when I want to sell it?"

It's an important question, since two vehicles that cost the same can end up with vastly different future values.  The trick question is, "how can you predict the future value?"

And the answer is to find out the "residual value" of the vehicle you are considering.  Residual means what's left-over.  So if we are looking for the 'residual value' we are looking for the value that's left at a given time in the future.  All vehicles have a residual value; some higher than others.  The key is to know your vehicle's residual value before you buy it.

Vehicles typically depreciate 50% or more in the first 3 years.  Given that fact, use it to your advantage.  Ask your dealer what the 36-month residual value is for the vehicle you are considering.  He will give you a number - which represents the percentage of the MSPR.  So ... he might say 48.  That means that the vehicle is expected to be worth 48% of the original MSRP in 36 months.  Your goal is to find a vehicle with a 36 month residual at 50% or better.

Now, that does not mean to avoid one with a 49% or 48% value.  After all, these numbers are not guarantees; instead they are educated predictions of future value.  A residual value between 40% and 50% is good.  But most dealers would agree that a value below 40% is below average and would indicate a vehicle that has lower demand in the market.  So remember, you might not have a crystal ball, but a residual guide may be a compass directing you towards a better vehicle.

Use this car depreciation calculator to find out how much you car will be worth after buying new  
Adam Goldfein
Nationally Recognized - Car Buying Advice Expert

www.AdamGoldfein.com

It's no secret that the price of your car drops the moment you drive it away from the forecourt but what about beyond that,They then compared it to the purchase price advertised on their website, to highlight which of the nation's top vehicles have held their value best over the course of the last year.  
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unless you go for antique or some real expensive brand, most cars loose value as soon as they leave the saloon, in fact some of them almost up to 50%, which is ridiculous. I would worry about the quality of the car and how long it will last before I have to start buying new parts.  
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Adam, Thanks for Great Article, I am really worrying about this problem too. My 2005 Tahoe is loosing it's price  
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So true.. Really a car looses its value over time. Its very hard to maintain one properly..... Thank-you for your post..!! Really served a great help..