I’ve now given 51 rides as an Uber driver and about 9 as a Lyft driver. Let’s do an analysis on my Uber earnings to see what you could expect to earn as a driver in the DC metro area (specifically Fairfax, VA, a suburb of DC).
Total earnings: $559.04
Earnings from driving: $409.04
Total hours online: 21.6
Driver Referral bonus: $150
I earned a total of $559.04, of which $409.04 was from driving, and $150 was from referring my brother as a driver in New Jersey. In order to receive the referral bonus, he had to reach a certain number of rides driven. He also got a $300 bonus for referring me because I gave 50 rides in the DC area within a month (bonus depends on location).
Taking a look at the numbers, you can see that I made about $18.94/hour driving ($409.04/21.6 hours) and $25.88/hour ($559.04/21.6 hours) if you factor in the referral bonus.
Here are some things you should consider if you decide to drive:
1. Miles per gallon – Since you have to pay for your own gas, I used my wife’s 2012 Toyota Prius which gets about 50 miles per gallon. Keep in mind you are putting miles on your car and slowly wearing down your tires, brake pads, etc., which will all cost money to maintain/replace. Gas prices are relatively low right now, but if they start to creep up, it will reduce your margin.
2. Taxes – You will get a 1099 at the end of the year and will have to pay taxes on your earnings. You do get to deduct business expenses. If you choose to deduct miles, you’ll get 54 cents/mile driven in 2016, down from 57.5 cents/mile driven in 2015. You can deduct not only miles driven with a passenger, but also the miles driven to pick up your passenger which ends up being pretty substantial.
3. Car has to be less than 10 years old and clean – You can’t just use any car to drive. Your car has to be less than 10 years old. You should keep it relatively clean and giving out water, gum, or candy can be a nice touch that might help you earn a good rating and possibly even a tip (tips aren’t required).
4. You don’t get paid to drive home – Your passengers can take you anywhere. I’ve been taken into DC, Bethesda, and even Burtonsville, MD. Once I drove 45 minutes to get home from where I was. You don’t get paid to drive home after your shift, which reduces your actual hourly rate.
Some other thoughts:
This was a fun experience for me, but I probably won’t be driving for Uber (or Lyft) very much anymore. I may keep my account active by driving at least once every 30 days, but I won’t be doing this in much more than a very, very part-time capacity. It was fun meeting new people and seeing different parts of the DC Metro area, but like most new jobs, it starts to lose its novelty after a while. I definitely learned a lot about the ridesharing industry.
I didn’t have anyone throw up in my car, but I’ve had my fair share of drunk and obnoxious people. Most passengers have been very nice, but I’ve also had some speak to me in a condescending manner.
Advertisements from Uber or Lyft stating you can earn six figures or close to it as a rideshare driver are misleading. If you put in 40 hours/week, I would say you could probably earn about $30,000-$45,000/year. Some drivers drive 10-12 hours/day and more than 5 days/week and can probably earn about $60,000-$70,000/year, but this is putting in 60+ hours/week and a ton of miles on your car. By learning the best strategies and taking advantage of surge periods, top drivers could potentially earn close to $100,000/year, but this will require a huge dedication of time and energy. In the end, Uber and Lyft take close to about 1/3rd of the fares you collect. Not for me.
Uber vs. Lyft.
Once I got approved to drive for both Uber and Lyft, I started using both apps simultaneously to reduce the time between ride requests. Once I got a request, I would turn off the other app. After I dropped off my passenger, I would turn on both apps again and repeat. For me, at least 70% of the time, the Uber app pinged me first. I would shut off driver mode on Lyft and driver for Uber. However, don’t let that deter you from using Lyft. In my experience, Lyft passengers were more friendly and typically took longer rides, which results in higher fares and better use of your time. Lyft also tends to let drivers keep more of the fare.
Do Your Homework
If you decide to become a driver, take some time while you’re waiting for your background check to go through to learn the best strategies and best practices. The Rideshare Guy was an invaluable resource and provided many insights about the ridesharing industry.
If you decide to give it a try, here are my referral links (no pressure!):
UBER referral link
LYFT referral link