Today ends my 15 day proof of concept (“POC”) driving for Uber. Going in I didn’t really know what to expect. They claim a driver can make $20-30 per hour, though everyone I knew who tried driving for Uber (and Lyft) said it wasn’t anywhere close to that. However, all of the people I spoke to had cars that only qualified for Uber X so I wasn’t sure how that would compare if I could hit all types of requests from riders. I plan to write another article on my summary from the experience, for riders, for drivers, etc. However, this article is specifically focused on the financials of the experiment.
|Vehicle||Uber X, Uber XL, and Uber Select|
Let’s look at the details. In the 15-day period, I worked every single day. No days off. On average I was online driving 5 hours a day, my maximum being 7.15 hours and my minimum being 2.28 hours. On average, I made around $100/day for that level of driving, my low was around $40 and my high was around $190. I primarily drove both the morning and the afternoon while Uber was offering 2x boosts in the target areas, in theory indicating this experience was maximized. I also attempted every daytime quest, furthering the argument this would be my maximum potential.
It’s important to keep in mind, as a petite female who is in bed by 10 pm every night so doesn’t do the bar crowds, a different person may have a different experience and earning potential if they are up for the late-night shifts. However, changing who I am and when I’m functional for driving humans safely from point A to B was not part of this experiment. It was matched to my highest performing times at Uber’s highest paying times.
RIDE REVENUES (less 30% for taxes): $1,063.43
Important – This includes a 30% tax rate with the IRS, which depending on your tax bracket could be more or less. Depending on if you’re able to deduct 1099 expenses could be more or less (certain tax brackets allow for it, others may not). In other words, you’ll have to look at your own situation, what you can qualify for, and make adjustments as needed to customize this analysis to your personal situation. You can also check out Uber’s help page for more information here.
On the surface earning a grand for 15 days of work may sound appealing to some people. However, let’s start factoring the costs it took in order to make that amount of money.
OVERALL COSTS: $266.25
Given I did not have a car nor even needed a car prior to Uber, the car was purchased to perform this experiment. To adjust for what I’d consider a fair allocation to Uber, I took the amount paid for the car, divided by 3 years, then by 12 months and then prorated the month to the 15-day period. Having a car required getting car insurance and a parking spot at my apartment building. Both expenses were prorated for the 15-day period. Lastly, the cost of having a highly functional cell phone with a beefy data plan was factored in and prorated.
It’s important to note that someone who already owns a car and has a use for a car outside of Uber, likely would have far lower overall costs than what I encountered. A couple other notes on this subject – Uber specifically does not recommend buying a car just for Uber. This was done by me, knowing this, for this experiment (and other future possibilities). Additionally, for $800/mo (or $200/wk) you can rent a car through Uber that would qualify for Uber X (so factor lower earnings than I had without XL and Select), plus increase the overall costs for the rental costs.
|EXPENSE||FOR UBER?||% UBER||MONTHLY COST||UBER ALLOCATION||15 DAY PRORATE|
Last note on this topic is purchasing a car that qualified for all three categories – Uber X, Uber XL, and Uber Select – did cost more than if I’d just leased a crazy cheap new Honda Civic or Toyota Prius. So you’ll want to think about your life, your car, and how that compares to what I’ve listed above to increase/decrease accordingly. I plan to write another article on whether it was worth XL and Select, meaning how much of my earnings came from those tiers.
So reducing overall costs, the new total becomes $797.18 for 15 days of work (in other words equivalent to 3 – 5 day weeks). Meaning around $260 for each 5-day chunk. Still seeming appealing? Didn’t think so and we’re not even done yet. Let’s add in all the actual direct costs.
DIRECT COSTS: $324.06
Driving for Uber means filling up your car with gas every single day. Luckily I rarely if ever drove my car for anything but Uber so it was easier for me to determine the proper fuel allocation. In addition, supplies are needed to keep your car clean and stocked for the happiness of your passengers. As part of becoming a driver, both a medical and vehicle inspection are required. I was fortunate to get the vehicle inspection free as part of buying the car, but otherwise, that would be another cost. Further, my apartment building allows me to wash my car for free, so the every other day bath my black car needed to stay attractive isn’t factored in.
|Fuel||06/30/2017||Shell Gas Station||$37.65|
|Maintenance||07/02/2017||O’Reilly Auto Parts||$5.37|
|Fuel||07/02/2017||Sinclair Gas Station||$24.23|
|Fuel||07/03/2017||Sinclair Gas Station||$15.35|
|Fuel||07/05/2017||Sinclair Gas Station||$31.57|
|Fuel||07/06/2017||Sinclair Gas Station||$23.84|
|Fuel||07/07/2017||Sinclair Gas Station||$14.32|
|Fuel||07/08/2017||Sinclair Gas Station||$15.85|
|Fuel||07/10/2017||Sinclair Gas Station||$19.32|
|Uber Sign-Up||07/10/2017||Uber Medical Check||$50.0|
|Fuel||07/11/2017||Sinclair Gas Station||$19.22|
|Fuel||07/12/2017||Sinclair Gas Station||$13.50|
|Fuel||07/14/2017||Sinclair Gas Station||$22.01|
If we incorporate the direct costs, we’re now down to a net profit of $473.12 ($1,063.43-$266.25-$324.06). In other words, if we thought of this in normal job terms of a 40-hour 5-day week, this would spread out to being a 25-hour work week, making around $160 per week. Are you sold?
Total earnings were $1,063.43. Total costs were $590.31. Leaving me with a net profit of $473.12. Spread across the 68.10 hours, puts this experiment at $6.95 per hour. Minimum wage in Colorado is $9.30 meaning I would have made more money flipping burgers at McDonald’s (68 hours x $9.30 = $633… a whole $160 plus no wear and tear or mile build up on my car!). On that note, it is important to add that this experiment does not factor in the negative toll this had on my car. There was no real way to quantify the impact of racking up 3,000 miles on my car in 15 days so if you can, feel free to add that into your costs.
Changing to a less expensive car, not having a car payment, being able to deduct your costs on your taxes, being in a lower tax bracket, having a more fuel efficient car, being willing to work the bar hours (10pm-2am) would all increase your ability to earn. Driving is really about the flexibility to earn money at any time of day, when you need it. It’s not huge earnings, but if you are someone who lives pay check to pay check or needs extra cash for a trip, etc. it can be a great way to meet your goals. More to come on why I still choose to drive for Uber even after this analysis!
If you still think Uber is for you, feel free to use this code to get a sign-on bonus (it gives me one too!): https://partners.uber.com/i/sarac13944ui
Hope this helps,