But think of it this way: I have some crappy stock I bought for $10k. It seems to lose a little every year for as long as I have owned it. Should I keep track of it in my finances? Because that's sort of how I see it. It's an asset. I want to keep track of it. I want to know how much it costs me over time.
That's the part I'm not quite grokking. I grok what you are saying, just not why you are doing it. Gas and maintenance are easy to track. But you don't really know what the depreciation is until you sell it. And it isn't a budget area where you can cut back. It's gonna do, what it is gonna do. Since you know don't know and can't change it, why bother? I want to know how much it costs me over time as well, that's why I track it as an expense.
What the same make/model is selling for is (to me) a pretty reasonable way to track it.
To me: having some reasonable approximation per year is much more usable. It lets me know what my expenses are in a nice even manner. Going 15 years then having a big spike expense of several thousand dollars doesn't give me a nice, FIRE budgetary item. Getting a reasonable guess of worth and taking a $700 depreciation expense seems more correct from an accounting sense.
YMMV. There isn't one right answer here. I've just built a system over time... complete with a crapload of charts and graphs that give me an at-a-glance way to measure what I'm doing, where I've been and where it looks like I'm going.
Thanks again for all inputs here. It's valuable to me. Just to keep the original post and question live - I wasn't asking "should I include it or not", I was asking - HOW do you estimate it.
For my mainstream cars:
* I have it on the books starting with what I paid for it.
* Jan 1 of the next year, I take an average of KBB/Edmunds for private party sale
* I use double entry bookkeeping. I depreciate the difference between the first item and the second as an expense and decrease the value of the asset by the same amount.
This year, one car showed a slight appreciation... which I'll write off as bullshit... and take $0. It's just really low mileage for it's age. That will stop making a difference at some point.
For my less mainstream car:
* I average ebay sold prices. It's old. It doesn't really depreciate. And it's not in good enough condition to actually appreciate.
Tractor:
* I use ebay/local auction sold prices. This one is likely to be pretty inaccurate.