Is driving for Uber worth it, This question might have disturbed you for a while. Especially when you’re thinking about signing up to that most popular ride-sharing company. You might have seen Uber ads that claims Uber driver can earn $25 per hour. With the flexible driving schedule, and amazing sign up bonuses that worth thousand. But, does that ads work?
Surprisingly, the Uber ads does work. A report from Booking Analysis of Census Bureau and Moody’s Data (United States) show different statistics.
They report that between 2010 and 2014, there is a rise of 69% in drivers making money via ride-sharing apps in the USA. And in 2015 alone, the number skyrocketed to 63% in just that year!
If you notice the rising chart, it’s very normal to be enthralled. The same goes with many other drivers in the following year that have quit their full time jobs and signed up for Uber to achieve the awesome earning.
Is Driving For Uber Worth It, Revealing The Amount of Uber Driver Actually Make
While becoming Uber driver can be nice with the promising income, it can also bring some risks. As you know well, driving with Uber means that you become their partner. In this case, you should use your own car or rent car to fulfil the coming ride requests.
Uber will not reimburse any expense you make for buying gas, car’s maintenance and insurance. Also you must pay for lease payment (if your car is purchased on credit), and other fees like license and permit fee.
As Uber driver you will have to pay all those expenses by yourself, although if your car is damaged by the passengers, they will reimburse the repairing cost.
There are two main points to be calculating when you want to know the amount of Uber driver really make:
- How much is the cost of Uber ride?
- How much is the expense of Uber driver?
Although the different factors that affect those two points above are much depending on the city you drive in, the overall calculation will be the same.
By knowing the result of the first point you can get the estimated amount you’re going to get before cut by expenses. And by knowing the result of the second point, you will get to know the net income you achieve.
That way, you will know the answers to the question “Is driving for Uber worth it?”
How much is the cost of Uber ride?
What passengers pay in each ride is based on the formula:
Subtotal (base fare + time + distance) + Booking Fee + Surge Pricing (if the ride is made during high-demand times).
So, the passengers will be charged with base fare at the beginning of the ride. Then they will be charged for every minute and every mile they ride with Uber. Plus a booking fee where they book the ride and surge pricing, if they request a ride during high-demand times.
The final calculation of passengers’ fare would be:
“subtotal + booking fee” (during normal time) or “(subtotal x surge pricing) + booking fee” during high-demand times.
The final amount of passengers’ fare is not the payout the driver will get from Uber. It’s because Uber will cut 20% from the passenger’s fare in each completed trip.
For example, if the final passenger’s fare in a trip is $ 20, you as a driver will get $ 16. Looks pretty good, right? But wait, there is the second point you should add in to get the net income.
How much is the expense of Uber driver?
When you driver with Uber, you must calculate hidden expense from each ride you complete. Often, many drivers are too enthusiastic with what they get from final passenger’s fare after cut by Uber fee and forget expenses they will make after.
The common expense of Uber driver includes:
- Lease payment (if your car is purchased on credit) or rent payment (if you rent the car).
- Car insurance (although personally you don’t want to sign up for insurance, the company has insurance policy).
- Car maintenance.
- License and permit fee.
The amount of expenses of Uber driver can vary based on many factors below:
- Type of car you drive.
- City where you drive in.
- Your age.
- Driving experience.
- Government policy, etc.
After knowing the amount you get after each drive, then you can sum the total up and reduced with all expenses you make to receive the net amount.
Do calculate well, although some expenses like car maintenance, insurance and lease/rent payment you will pay monthly, you still have to take the into calculation carefully. That way you can know whether is driving for Uber worth it.