Not long ago, I enjoyed an Uber ride with a young woman who had worked her way out of a homeless shelter by driving for Uber. She is just one of several Uber drivers who shared their success stories with me. Thus, when I found myself wanting to knock out a few bills, I signed up to be a driver.
Requirements and Signing Up
- Be 21 years old with one year of driving experience (three years if under age 23).
- Have a current United States driver’s license.
- Have an eligible four-door vehicle that is less than ten years old.
- Have proof of insurance.
After uploading the necessary documents, I was approved within hours. I downloaded the Uber app and hit the road. Two hours later and $25 richer, I cashed out and the money arrived in my bank account within minutes. “Wow,” I thought, “this is great, $12.50 an hour off peak, and I make my own schedule.” Immediately, I began envisioning my debts wiped out. No doubt, many folks have the same thoughts during their first days driving for Uber.
Consider The Costs
When making a mental list of the bills you’ll pay with your Uber money, make a mental list of the bills you’re running up as an Uber driver.
- Car washes
- Rideshare insurance
- Check your state’s ridesharing regulations, and check with your insurance company to see if your policy covers driving for Uber, most personal policies don’t. So, unless you buy a rideshare policy, sometimes injuries to you and/or damage to your vehicle aren’t covered. You can risk driving without letting your insurer know but for me, when driving, safe trumps lucky.
- Vehicle maintenance
- After just two weeks of driving, my car hit its scheduled 45k maintenance, which came with a $220 price tag.
- Vehicle depreciation
- During a six-hour day, I drove about 200 miles. Driving three days a week, that’s 3k miles in five weeks, 30k miles (600 miles a week x 50 weeks) in a little less than a year.
Uber emphasizes the pros of being a driver, and they do exist:
- You make your own schedule.
- You get paid quickly
- If you deduct mileage rather than actual expenses when doing your taxes, a good portion of your earnings won’t be taxable.
Is Driving for Uber Worth Your Time?
For me, no. I don’t want to put double or triple the normal number of miles on a fairly new car. Also, I made a lot of short hops. Driving without a passenger to pick up a five-dollar fare doesn’t make sense and longer fares don’t make up the difference.
As a side gig to pay down a few bills? May make sense for someone with an older, already depreciated car, particularly if that person can service it. A few weeks of quick cash flow can knock out small debts in a hurry.
Quit a day job to drive Uber? For me, not a chance. The freedom doesn’t outweigh the costs and risks. Driving for Uber doesn’t build a business that grows over time. Instead, you rapidly depreciate a high value asset (your vehicle), and probably aren’t putting away money to replace it. In addition, you aren’t gaining valuable work skills. And don’t forget, you’re responsible for your health insurance and you don’t get paid if you’re sick, or if your vehicle is in the shop.
Bottom line: If you need some quick cash, Uber may be a good short-term solution but long-term the only pockets it’s lining are those of venture capitalists and the company’s founders.