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John says
September 23, 2016 at 6:36 pm
READ THIS IF YOU REALLY WANT TO KNOW HOW MUCH $$$ YOU MAKE DRIVING
I have been a driver for LYFT and UBER for 1 year and working full time for 9 months. I have completed over 2,200 rides. I have an accounting background and I lost my professional job. Out of desperation, I became a driver for UBER/LYFT. I keep precise records of all income and expense. The bottom line statistics are not at all promising to be a driver. I took precise mileage and earnings figures. For 9 months, I drove 41,291 miles, gross revenues before expenses and taxes were 0.61 cents/mile (including cash/non-cash tips). In my market, average gross revenue for UBER and LYFT is 0.80 cents/mile BEFORE 20% commission paid to UBER/LYFT. Of significance, my gross earnings per mile were 25% higher in 2015 ($1.00/mile), which means that average gross earnings per mile will be LESS in future periods. Thus, my findings at the end of this post are UNDERSTATED. Earnings include prime time and surge pricing. I worked more than full time for 6 months during all optimal times of the day (12+ hours/day, 5+ days/week).
0.61 cents/mile doesn’t sound bad, right? Well, not until you account for all costs. Actual total costs to drive a 2011 Nissan Altima was $11,829 or $0.29 cents/mile (including fuel, conservative depreciation, insurance, service, cell, and food giveaways. So, net earnings BEFORE taxes were ONLY $0.32 cents/mile. Notice the SHARE of income on a percentage basis is 51% (me) and 49% (them). This is because of the REAL expenses required to do this job reduce the share of gross earnings from 80% to 51%.
Let me break this down in terms we can all relate to. In order to earn $500/week (net of all expense & before taxes), you have drive 313 miles/day for 5 days/week. 313 miles can be driven in 5.2 hours assuming no stops, regular traffic, and an average speed of 60mph (or 21 rides completed at an avg. of 15 miles/ride). As you are well aware, it is impossible to complete 300+ miles in 5 hours because, of course, you have to make stops, wait for riders, deal with traffic, and determine your next destination. But, let’s say for the sake of argument you could. So, after adjusting for stop, wait, traffic, navigation (an additional & conservative –96 minutes), you have worked over 6 1/2 hours. This is at an average speed of 60mph! A more reasonable assumption would be an average speed of say, 35mph, which would translate to over 11 hours work/day. This translates to an hourly wage (before taxes) of $9.12 per HOUR! Let me also state that 1) I do NOT have commercial insurance, 2) these assumptions do NOT include an adjustment for accident risk, 3) this does NOT include any damage to your vehicle caused by riders, 4) the risk of injury or worse because of undesirable riders, and 5) you still have to pay taxes on any ‘net’ income. So, given these precise calculations, is it still worth it to drive for $9.12/hour BEFORE you pay taxes?
I know what you are thinking: you receive a direct deposit that is much larger than $9.12/hour, you receive referral bonuses that translate into more $$$ for you, and you think you are better than the average driver so you make more in tips than those ‘other’ losers. Well, have you actually sat down and accounted for all of your expenses? Let me share my personal experience: for 9 months I earned $1,569 in cash tips + 1,461 in LYFT inApp tips, BOTH of which have been already accounted for. What I excluded from the calculation was what I view as “non-recurring” fees earned. Meaning, I believe that future earnings in this category will substantially lower or eliminated entirely. I made a total of $3,660 for 9 months for the following: 1) sign on bonus 2), driver referral for 1 person and 3)passenger referral fees for over 125 NEW riders to LYFT. So, did you earn an average of over $100/week for referral/sign-on bonuses every week that you worked? That is what I earned. You have to ask yourself how much you have earned from these ‘non-recurring’ and NOT reliable sources of income. Including this non-recurring income, I earned an additional $0.09 cents/mile.
So, in the final analysis, I made an average of $0.40 cents/mile (including surge pricing, referral fees, tips) in net income, which assuming a 40 hour work week (this is understated) translates to $11.47 PER HOUR. This is BEFORE taxes and BEFORE any of the risk you take as a driver. Is it still worth it?
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from Should You Drive For Uber? Check Out My Results
John says
September 23, 2016 at 6:36 pm
READ THIS IF YOU REALLY WANT TO KNOW HOW MUCH $$$ YOU MAKE DRIVING
I have been a driver for LYFT and UBER for 1 year and working full time for 9 months. I have completed over 2,200 rides. I have an accounting background and I lost my professional job. Out of desperation, I became a driver for UBER/LYFT. I keep precise records of all income and expense. The bottom line statistics are not at all promising to be a driver. I took precise mileage and earnings figures. For 9 months, I drove 41,291 miles, gross revenues before expenses and taxes were 0.61 cents/mile (including cash/non-cash tips). In my market, average gross revenue for UBER and LYFT is 0.80 cents/mile BEFORE 20% commission paid to UBER/LYFT. Of significance, my gross earnings per mile were 25% higher in 2015 ($1.00/mile), which means that average gross earnings per mile will be LESS in future periods. Thus, my findings at the end of this post are UNDERSTATED. Earnings include prime time and surge pricing. I worked more than full time for 6 months during all optimal times of the day (12+ hours/day, 5+ days/week).
0.61 cents/mile doesn’t sound bad, right? Well, not until you account for all costs. Actual total costs to drive a 2011 Nissan Altima was $11,829 or $0.29 cents/mile (including fuel, conservative depreciation, insurance, service, cell, and food giveaways. So, net earnings BEFORE taxes were ONLY $0.32 cents/mile. Notice the SHARE of income on a percentage basis is 51% (me) and 49% (them). This is because of the REAL expenses required to do this job reduce the share of gross earnings from 80% to 51%.
Let me break this down in terms we can all relate to. In order to earn $500/week (net of all expense & before taxes), you have drive 313 miles/day for 5 days/week. 313 miles can be driven in 5.2 hours assuming no stops, regular traffic, and an average speed of 60mph (or 21 rides completed at an avg. of 15 miles/ride). As you are well aware, it is impossible to complete 300+ miles in 5 hours because, of course, you have to make stops, wait for riders, deal with traffic, and determine your next destination. But, let’s say for the sake of argument you could. So, after adjusting for stop, wait, traffic, navigation (an additional & conservative –96 minutes), you have worked over 6 1/2 hours. This is at an average speed of 60mph! A more reasonable assumption would be an average speed of say, 35mph, which would translate to over 11 hours work/day. This translates to an hourly wage (before taxes) of $9.12 per HOUR! Let me also state that 1) I do NOT have commercial insurance, 2) these assumptions do NOT include an adjustment for accident risk, 3) this does NOT include any damage to your vehicle caused by riders, 4) the risk of injury or worse because of undesirable riders, and 5) you still have to pay taxes on any ‘net’ income. So, given these precise calculations, is it still worth it to drive for $9.12/hour BEFORE you pay taxes?
I know what you are thinking: you receive a direct deposit that is much larger than $9.12/hour, you receive referral bonuses that translate into more $$$ for you, and you think you are better than the average driver so you make more in tips than those ‘other’ losers. Well, have you actually sat down and accounted for all of your expenses? Let me share my personal experience: for 9 months I earned $1,569 in cash tips + 1,461 in LYFT inApp tips, BOTH of which have been already accounted for. What I excluded from the calculation was what I view as “non-recurring” fees earned. Meaning, I believe that future earnings in this category will substantially lower or eliminated entirely. I made a total of $3,660 for 9 months for the following: 1) sign on bonus 2), driver referral for 1 person and 3)passenger referral fees for over 125 NEW riders to LYFT. So, did you earn an average of over $100/week for referral/sign-on bonuses every week that you worked? That is what I earned. You have to ask yourself how much you have earned from these ‘non-recurring’ and NOT reliable sources of income. Including this non-recurring income, I earned an additional $0.09 cents/mile.
So, in the final analysis, I made an average of $0.40 cents/mile (including surge pricing, referral fees, tips) in net income, which assuming a 40 hour work week (this is understated) translates to $11.47 PER HOUR. This is BEFORE taxes and BEFORE any of the risk you take as a driver. Is it still worth it?
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from Should You Drive For Uber? Check Out My Results
