Kelley Blue Book has published its annual Best Resale Value Awards for model year 2010 vehicles.

When we buy a car, we think of the price as the true cost, along with the expense of insurance, gas and maintenance. But the real cost of a car is depreciation -- how much in value it loses during the initial years of ownership.

Here are the brands that are projected to hold their value the best during the next five years:

• Lexus
• Toyota
• Honda
• BMW
• Subaru
• Jeep
• Acura
• Infiniti
• Audi
• Nissan

Kelley Blue Book goes on to say that half of all 2010 model year vehicles are expected to maintain less than 20 percent of their initial value after five years. So consider that before buying a fancy new car. Buy a not-so-fancy used car instead and let somebody else handle the depreciation!

If you must buy new, plan on holding a car for 10 years or longer to absorb all the depreciation. As an alternative, buy a two-year-old car and hold it for three years or a three-year-old car and hold it for two years.

The "cash for clunkers" program is taking form and promises rebates of $3,500 or $4,500 for trade-ins when you purchase a newer fuel-efficient vehicle.

The effective date for the program -- officially known as the Car Allowance Rebate System (CARS) -- has not yet been set. But Clark expects it to be sometime toward the end of July or the beginning of August. There should be a 2-month buying opportunity through October.

Let's say you start from a baseline of 18 mpg on your current vehicle. If the new car you intend to buy gets 22 mpg or more, then you'd get the $3,500 voucher toward the purchase.

Please note that participating dealers will apply this taxpayer-subsidized credit directly to your purchase.

You're only eligible for the full $4,500 voucher if your next purchase gives you at least 10 mpg more than your old vehicle.

Meanwhile, there's a lower threshold for SUVs and trucks. You'll get the $3,500 voucher if your new vehicle get 2 mpg or higher. If it gets 5 mpg or more, you then get the $4,500 voucher.

The vehicle you're trading in has to be drivable and the dealer has to agree to crush it. There are also several rules to prevent abuse of the program. For example, the car you're dumping has to have been registered and insured continuously for at least 12 months prior.

Other countries that have experience with similar programs saw an immediate big increase in sales as a direct result of the program. That's the hope for the American auto market too.

Remember, of course, that there are still some great deals on vehicles available regardless of the "cash for clunkers" program. The more shopping you do, the better the price you will get. See Clark's tips for buying a new car.

The deals on new cars are undeniably amazing because of vast oversupply. But has Clark's recent overwhelming enthusiasm about buying new left you exasperated with the consumer champ?

It's as if "Used Car Guy" is betraying his roots. Whatever happened to his advice to ride your old car until the wheels fall off?

Well, here's a rebuttal that may please you. AAA reports that the true annual expense of owning and operating a car is $7,800, according to an article in The Wall Street Journal. This figure takes into account insurance, gas, maintenance, interest, depreciation and other factors.

The real cost of buying a new vehicle comes when you take a huge hit on depreciation during the first few years of ownership. But that loss in value decreases each year until you're eventually practically driving for free.

So the math remains lousy if you buy a car and keep it for a short cycle. And it's even worse if you lease a car.

It appears certain that General Motors is going bankrupt. The government was hoping to keep GM afloat with a private workout, but they're running out of time and it's unlikely that will happen now. Since we've already sent them over 30 billion in bailout money, the question remains as to who will assume control of the bankrupt company -- the government or the debt-holders. Either way, stock holders and bond holders will lose.

What if you own a GM or Chrysler car? The good news is the feds have agreed to back the existing warrantees for both, as well as the dealers' extended-service contracts. The bad news: some of you who traded in a car that still had an outstanding loan may face a problem. Dealers who are going bankrupt are not always paying off the loan on your old car as agreed. Unfortunately, that leaves you responsible to pay off both loans, even though you traded it in.

Another problem with these dealer closings is loss of your service records. Warrantee agreements rely on these records to determine whether owners are doing the required recommended maintenance. Without them, claims can't be processed.

What does this mean for you? In this market, Clark advises you to not to trade in a car that still has a loan. Also: if you don't have all your service records -- and your dealer is still in business -- go to the dealership, request copies of all your records and file those away. On the plus side, if you're a buyer, inventory overstock will allow you to steal a deal! But you'll need to buy with the intent of keeping the car a long time -- ten years or so -- since your car will have little to no value in the used-car market.

Your car is the second most expensive purchase you're likely to make after your home. So people often ask about which vehicles hold their value best after 5 years. To answer that question, Kelley Blue Book has just released its 2008 Best Resale Value Awards tally.

The winner is Volkswagen, which is making a comeback after some recent big losses. VWs keep just under half their value after a 60-month cycle. The other brands that round out the Top 10 are BMW, Acura, Honda, Porsche, Subaru, Lexus, Infiniti, Audi and Toyota.

On the other end of the spectrum, the worst brand to hold value has been singled out as Suzuki. With Suzukis, you only get about a quarter back for every dollar after 5 years. Other cars that really stink when it comes to holding value include Kia, GMC, Mercury, Dodge, Chrysler, Lincoln, Jeep, Ford and Jaguar.

On a related note, the Insurance Institute for Highway Safety (IIHS) says that the Subaru Impreza is the only small car that meets its strict safety standards. There were tons of midsized vehicles green-lighted by the IIHS, but not so in the large vehicle categories -- despite what you may remember from high-school physics!