Increasing one’s income is useful for meeting financial goals, especially if you’re struggling to cut expenses. I’ll go through the pros and cons of my experience driving with the popular ridesharing and restaurant take-out delivery platforms Lyft, Uber, and Uber Eats. I hope that sharing my rideshare driver experience will help you integrate a side hustle into your busy schedule. Fortunately for us, technological advances have brought about the so-called gig economy.
Gig Economy: Side Hustles and Freelance Work
Okay, I’ve thrown around a few terms. Before we get too far, let’s break them down.
Gig economy – economic activity that involves the use of temporary or freelance workers to perform jobs (typically in the service sector)
Side hustle – work performed for income that supplements one’s primary job
Today the technology exists to efficiently transform snippets of idle time in even the busiest schedules into paid work. The internet has exponentially increased our ability to communicate and conduct business with new customers. Take advantage of free time to supplement (or replace) your income stream.
Enter The Side Hustle: Your Friendly Neighborhood Rideshare Driver
I was chasing the American dream. Get married, buy a house, and make babies (not necessarily in that order.) When I realized that purchasing a home took more funds than I had (plus a less than ideal debt-to-income ratio), I turned to Uber and Lyft as convenient side hustles.
My strategy was to budget for my necessities – bills and food – with my primary income. After deducting the cost of operating and cleaning the vehicle, I’d use the extra money from the side hustle to save for a house. I was surprised by the pros and cons of being a rideshare driver for Uber and Lyft.
The Pros of Being A Rideshare Driver for Uber or Lyft
As with anything, driving for Uber and Lyft had pros and cons. I appreciated the highly flexible schedule and extra cash after only a few days of ridesharing. In addition, I noticed other benefits I couldn’t have imagined beforehand.
Rideshare driving during a busy Friday or Saturday night allows you to multiply the earnings during peak demand (last call!). An added bonus? You can avoid participating in the normally budget-destroying partying yourself. Start with a carefully timed evening nap after home-cooked meals. Then you can be more profitable in fewer hours and avoid spending money going out.
Both platform applications (Lyft and Uber) were intuitive despite the occasional bug or glitch. Lyft was the first to implement the tip driver feature. Fun fact: my partner at the time was tipped significantly more than I was, even though my car was cleaner and had more perks (bottles of water and mints). Personality goes a long way.
They also offered additional features, like instant cash. If I had an unexpected budget shortfall or wanted extra cash in the tight days before payday, I could drive a few hours and make the money needed to meet that urgency.
The Added Value of Experience
I was also able to explore different parts of my region. Those nooks and crannies can reveal your next favorite restaurant, park, or point of interest. As someone contemplating their first home, rideshare driving let me visit potential properties in other parts of town.
You’ll also gain unexpected insights into those neighborhoods. While taking a rider to their destination in a hip part of town, I found myself redirecting around flooded streets. I discovered a sudden deal-breaker for a neighborhood I previously thought ideal.
Additional Financial Incentives
Take advantage of program incentives that come with being a rideshare driver. Surge pricing is the most common one. Referrals were easier when Uber and Lyft were relatively new platforms. I made quite a bit of money by simply tapping a few buttons on my phone to share my referral code. Don’t be “that guy” and spam your friends and family, though.
You can also consider challenge bonuses, which encourage you to drive more often. Rewards are available for meeting a particular goal, such as completing 30 rides in one week.
Leasing Through Your Rideshare Platform
The car leasing program is available to those who want to put fewer miles on their personal car, those with an unqualified vehicle (broke-down, too old, etc.), or drivers that don’t own a vehicle. You have a built-in gig with increased income if you buy through these programs.
Being More Intentional With Downtime
It’s best to avoid driving aimlessly through town, adding uncompensated wear and tear on your vehicle and burning gas (or electrons for you EV folks). Instead, park near population centers. Then, use any slivers of time between rides to catch up on studying, reading, or making phone calls.
I met interesting people and had very memorable conversations driving. Depending on the rider, you could listen to music, podcasts, and audiobooks. I often discovered new music or podcasts by listening to rider-requested content.
Pro tip: The best way to make bank while driving
I learned that a series of closely timed short rides (5 minutes and under 5 miles) and long rides (20+ miles and 30 or more minutes) were the most profitable. In my experience, medium distances were not the best moneymakers. You can pick up multiple passengers in larger cities through UberPool, increasing productivity.
Keep in mind that with more passengers come more problems. Ultimately, I preferred delivering food over rideshare driving. Through Uber Eats, you can also take multiple orders on one “trip.”
The Cons of Being A Rideshare Driver for Uber or Lyft
Entering the gig economy by driving for a rideshare platform like Uber or Lyft has pros, but also a few cons. I’ll briefly cover the obvious ones.
Major vehicle repairs can cancel a significant portion of your rideshare revenue. Logically, regular maintenance will occur more frequently. You have an uncompensated responsibility to care for your tires, oil changes, brake pads, and cleaning. Fuel is an operating cost you will feel immediately. You’ll soon learn where all the cheapest gas is available and top off the tank at each gas stop.
Don’t risk driving without commercial insurance. Rideshare platforms offer this in some states, but your coverage requirements depend on location. Admittedly, your insurance rate will be a bit more expensive and eat into profits. But make no mistake, it won’t be nearly as expensive as an accident without insurance.
Surge Pricing At Inconvenient Times
If you’re a morning person, I suggest picking up morning work commuters and delivering Uber Eats at lunch. Night owls can burn the midnight oil (or 87 octane), picking up passengers leaving restaurants and bars.
If you’re not careful, you can quickly drive up a sleep deficit or at least throw off your regular sleep schedule. This might not make rideshare driving worth the costs to your health. Consistent sleep is important for more than just babies.
Leases Are Too Good To Be True
You can often get better rates for leases and car ownership through credit unions.
Ridership can vary with the seasons. You may have to travel far to the nearest large airport or sports venue. Being unable to rely on a steady income stream can stress you out, especially if you rely on it as your primary source of income.
Safety Is A Concern, Even For Pro Athletes
We’ve all heard stories about unruly passengers attacking drivers. Late-night intoxicated passengers can be the stuff of nightmares. My horror stories include disrespectful smokers, fast food accidents, shoes on the dash, and vomit.
Food For Thought: If You Prefer Your Solitude
Do you want to participate in the gig economy and earn some extra cash, but savor your peace and quiet? My preferred paid trips while driving were for Uber Eats. With expanded offerings from DoorDash, gig work related to driving doesn’t have to flex your social bones. Skip the humans and cart the food. The only downside I could find there? My car consistently smelled funny.
Was It Worth It?
Don’t let the cons of being a rideshare driver for Uber or Lyft outweigh the pros. I often drove a couple of hours and then took my present-day wife out for dinner. Too often, I plugged a hole in my budget to get some quick cash for one thing or another. Always keeping the end goal in mind, I ultimately took advantage of the gig economy and saved for my first home.
I can easily see myself driving again to generate cash for home improvement projects. If you have a car, I recommend giving it a shot for a time. Reduce that debt or save for a vacation, all while you learn about humans in your community and drive past places you never thought you’d see.