Uber to work

[lcmac32]

I recently added driving for Uber to my early morning big city commute to work.  My commute time is now longer 30-45 minutes longer, but I get paid $18-20 per hour for the longer (time) commute.  My office is close to the airport and I have a 28.5 mile commute.  I have very early hours and leave the house at 4:30am.   If I don't pick up a ride, no big deal, as I can arrive at the office early and leave early,  but last two days it has worked like magic and I am getting paid for most of my normal commute miles.  I don't plan to drive for Uber forever as the per hour rate is not great compared to my job. It is more of an multifaceted experiment to use some of my unused hours of each day in a better way and possible move to opening my own business. I wanted to see what driving for Uber could make on a monthly net basis as a income bridge to offset business expense until it grows enough to be a) self-sustaining and b)profitable.  The side money is also nice for now.  Day 1, $43.24 for almost identical commute path (1 rider); Day 2 $31.73 almost identical commute (2 riders).   As I drive a paid for 2011 hybrid car, my fuel costs are not bad 50miles/gal.   There is the wear and tear cost, but other than that no huge downsides so far.

[terran]

Great idea! Is there any issue with being selective such that fares get you close to work? I seem to remember seeing something about Uber penalizing drivers if they turn down too many rides.

[Car Jack]

As long as your insurance is ok with this, you've got a reasonable reason to drive for Uber.  If your insurance is like mine (I asked), they'll require either full commercial insurance or a rider for driving for a ride share company.  Mine said that if I have a claim, even when not driving for Uber, they go to state minimums.  Liability only with $10k per accident.  I have heard others say that they've been able to purchase specific ride share coverage for as little as $35 a month.  Not mine.  $3k on top of what I currently pay.

[lcmac32]

Great idea! Is there any issue with being selective such that fares get you close to work? I seem to remember seeing something about Uber penalizing drivers if they turn down too many rides.

I haven't been selective as I have accepted whatever showed up.  3 days in a row leaving that early 4:30am has gotten me an airport trip each time.  I am still in the testing mode, so will post results after a reasonable sample size.  This isn't completely Mustachian, but a little hack to make the commute a little better.  I have also gotten two trips toward home from the airport.  My city is quite large, so technically they could have gone the other way, but in the morning it is almost certain (so far) that I am headed toward work.  Thanks for the response.

[lcmac32]

As long as your insurance is ok with this, you've got a reasonable reason to drive for Uber.  If your insurance is like mine (I asked), they'll require either full commercial insurance or a rider for driving for a ride share company.  Mine said that if I have a claim, even when not driving for Uber, they go to state minimums.  Liability only with $10k per accident.  I have heard others say that they've been able to purchase specific ride share coverage for as little as $35 a month.  Not mine.  $3k on top of what I currently pay.

Working on that now.  Will let you know the results in amount of premium increase.

[lcmac32]

As long as your insurance is ok with this, you've got a reasonable reason to drive for Uber.  If your insurance is like mine (I asked), they'll require either full commercial insurance or a rider for driving for a ride share company.  Mine said that if I have a claim, even when not driving for Uber, they go to state minimums.  Liability only with $10k per accident.  I have heard others say that they've been able to purchase specific ride share coverage for as little as $35 a month.  Not mine.  $3k on top of what I currently pay.

Working on that now.  Will let you know the results in amount of premium increase.

Insurance Update - my insurance premium went up by $40.00/month.  Not great, but not a huge issue.  It does remind me to be extra careful out there. 

Paid to commute to work update -  Day 3 picked up another airport trip which, as said, is 5 minutes from my office.  $21.19 for the ride.  I am averaging $25.57 per commute on the three day.  Uber driving is offsetting the clown commute.  I have had return home trips twice, but that is much more random chance than the early morning commute.  Overall, not a bad experience so far.

[Goldy]

This is fantastic

[Chris Pascale]

Have you hit any snags, like being taken out of your way to the point that it wasn't worth it? When I drove Uber in 2017 you didn't have any idea where the pickup was going.

[lcmac32]

Have you hit any snags, like being taken out of your way to the point that it wasn't worth it? When I drove Uber in 2017 you didn't have any idea where the pickup was going.

Only one snag on a Saturday.  I was out of town about 15 miles for one pickup and the rider needed a drive an hour the other way.  Made me late for a movie with the family.  I was about 10 minutes late, so I drove straight to the theater.  Considering my "why" for the Uber experiment, a late arrival occasionally is not huge. 

You do bring up the most valid point about Uber driving.  Drivers work for Uber and the passenger, and work is not always convenient for the driver.   Much like my day job.  :-)

[lcmac32]

The one week commute update is I am averaging $36.80 per day for the trip.  $184.00 for the week.  Now I will have to subtract gas, taxes and insurance out of that, but I am confident that I am getting paid to commute on the way to the office.   

The week total was $849.52 for 38.25 hours.  Hourly rate = $22.21/hour.  That is significantly less than my day job hourly, but it is helping me achieve other goals. 

The people have generally been nice, but some of the party people were a little obnoxious.  The really plastered ones we simply sad, but I was glad I was driving them and not them driving themselves.

Thanks for coming along for the ride...I will post a monthly total and quarterly total if it lasts that long.  But mostly want to encourage those seeking FI that it really is out there for the taking and multiple paths to help you along the way.

[lcmac32]

I quick update on the uber experience.  I am still getting an airport rideshare almost each day on my commute to work.  Averaging about $20-25 for that trip.  It has been 10 of 11 days on the commute that someone has needed the to go to the airport.  That part is the most efficient part of my uber driving experience.  It is a 5-6/day grind.  I am averaging of $100 per day including gas deduction monthly car wash service (unlimited for $30/mo.), and insurance premium increase ($40/mo.).  Overall, it has been a good experience.  Not sure how long it will last, but it will at least be through Jan. 2020.

[partialexponent]

Very cool idea!

Do you have a minimum # of hours you need to hit to be an active driver, or could you only do the morning commute if you wanted?

I've read that Uber has a "destination mode" for drivers to ensure that you don't get someone going in the opposite direction when you're headed home. Is that something you've looked at?

[lcmac32]

Very cool idea!

Do you have a minimum # of hours you need to hit to be an active driver, or could you only do the morning commute if you wanted?

I've read that Uber has a "destination mode" for drivers to ensure that you don't get someone going in the opposite direction when you're headed home. Is that something you've looked at?

I don't know about the minimum number of hours.  If I only did the commute portion, then I would be at about 8-10 hours/week.  Because I am saving a war chest by driving for Uber to open a business, I am hustling 4x that in hours beyond my regular job.  Last week was 38.25 hours.  I imagine that is enough to be considered an active driver.

I have used "destination mode" with limited success.  It is true the pick up is on my route home, but the ride isn't always in the same direction.  Because I am already close to the heart of the city, I just put in about 4-5 hours after work in the area, and go offline for the commute to be home between 8:00 - 9:00pm each night.  I will experiment more with the "destination mode" and let you know. 

[acepedro45]

I don't mean to be a killjoy, but I'm a huge Uber hater. Are you sure your driving is really profitable for Uber? Actually that's poor phrasing. I'm sure your driving is profitable for Uber...but is it profitable for you?

In the example you gave....

The week total was $849.52 for 38.25 hours.  Hourly rate = $22.21/hour.

I'm hoping the 38.25 hours includes waiting around in between fares. If you were driving around for 38.25 hours and averaging 30 mph, you drove extra 1147.5 miles for Uber. Let's say your depreciation, maintenance and fuel expenses are close to rock bottom and you manage to pay only 29 cents a miles (half of the IRS estimate of 58 cents/mile on average but realistic for an economy car with a DIY hustler doing most basic maintenance things at home)…now you subtract 332.78 from your gross. You mentioned you need a more expensive insurance to cover your Uber activity. Call it another $10/wk.

Now we have (849.52-332.78-10)/38.25 = $13.24 per hour with no benefits and with self-employment tax owed that a W-2 employee would not owe. I don't mean this to come across as me crapping all over your hustle (on the contrary, I applaud you being out there working extra to enable your FI plans, start a business, whatever) but I think you need to take a harder look at the numbers. Maybe you'd put some different assumptions in there somewhere and come up with a different result.

If it truly is time that would be expended wastefully just on your commute, then sure, even $5 an hour is a good haul. But what you describe is working an entire second job for almost 40 hours a week.

[lcmac32]

I don't mean to be a killjoy, but I'm a huge Uber hater. Are you sure your driving is really profitable for Uber? Actually that's poor phrasing. I'm sure your driving is profitable for Uber...but is it profitable for you?

In the example you gave....

The week total was $849.52 for 38.25 hours.  Hourly rate = $22.21/hour.

I'm hoping the 38.25 hours includes waiting around in between fares. If you were driving around for 38.25 hours and averaging 30 mph, you drove extra 1147.5 miles for Uber. Let's say your depreciation, maintenance and fuel expenses are close to rock bottom and you manage to pay only 29 cents a miles (half of the IRS estimate of 58 cents/mile on average but realistic for an economy car with a DIY hustler doing most basic maintenance things at home)…now you subtract 332.78 from your gross. You mentioned you need a more expensive insurance to cover your Uber activity. Call it another $10/wk.

Now we have (849.52-332.78-10)/38.25 = $13.24 per hour with no benefits and with self-employment tax owed that a W-2 employee would not owe. I don't mean this to come across as me crapping all over your hustle (on the contrary, I applaud you being out there working extra to enable your FI plans, start a business, whatever) but I think you need to take a harder look at the numbers. Maybe you'd put some different assumptions in there somewhere and come up with a different result.

If it truly is time that would be expended wastefully just on your commute, then sure, even $5 an hour is a good haul. But what you describe is working an entire second job for almost 40 hours a week.

acepedro45....no worries at all on the post.  I totally agree on most fronts.  The actual numbers are slightly different (50 mpg for example) and yes I do every maintenance I can on my own, but your point is well taken.  My only rebuttal is most people don't quote their effective hourly rate.  For example, if I say I earn 100k/year at BigCorp and get two weeks paid vacation/year.  I would tell people I make $50/hour.  $50 * 40hrs * 50 weeks = $100k.  I wouldn't say I make 100k - 33k(taxes) = $77k.  $77k/50weeks/40hrs = $38.50/hr, even though that would be a more accurate statement of what I actually took home per hour. 

Uber on the commute works 13/15 days so far and has an absolute benefit.  The other driving is specific to building up a war chest for opening a business.  I need $10-15k, and don't want to touch the current budget at a 35.5% savings rate to build up that capital, so I am using Uber to get there.  There are probably better ways (specifically further adjust my expenditures), but for now Uber is just too easy (lazy way) as Uber creates the work not me.  I will save the marketing energy for my business, which hopefully will open May 2020.

I do believe this does help illustrate another mustachian point.  When one (me) is saving at a 35.5% rate, the more optimal play is to simple reduce spending further...and yes there is plenty of room still for that.   

On another note I will be doing seasonal tax work @ $25/hour x min. of 20 hours per week starting late Jan. 2020.  Wait....I meant to say $18.75/hour to account for taxes and $2.50/week on gym membership (body maintenance as opposed to car maintenance). ;-) 

[EngagedToFIRE]

This seems to be a totally untapped market and I bet Uber could get a TON more drivers if they could crack the carpool.  I don't just mean sharing like Uber Pool, but I mean where you are doing what OP is doing.  Which is picking up a ride in the same direction as work.  If no rides, that's ok.  Or it can even work on scheduling where people schedule ahead.  I don't know, but it seems like such an obvious thing.  People don't want to drive around like a taxi, but tons of people would have no problem car pooling if it only adds 10 - 20 minutes and they get paid for it.

[Chris Pascale]

I drove Uber for a few months and felt like I was cashing out back end value of the vehicle for cash today. Cash I badly needed using a vehicle that was already pretty old.

But!!!! One night I picked up a young girl who told me that the last time she called a cab, it took over an hour to come, and the driver insisted on picking up a prostitute with her in the car. Hearing this, I was very happy to have provided a safe and clean transport to this young girl in a less-than-preferable neighborhood.

Until we have 99.9+% reliability on driverless cars, being a driver is a very important job, and anyone doing it well is serving his community.

My last Uber driver was a former NYC cabbie, and he said he loved being able to wake up at 6AM, not 4AM, starting a pot of coffee and waiting for the app to alert him instead of having to be in his car.

[lcmac32]

I drove Uber for a few months and felt like I was cashing out back end value of the vehicle for cash today. Cash I badly needed using a vehicle that was already pretty old.

But!!!! One night I picked up a young girl who told me that the last time she called a cab, it took over an hour to come, and the driver insisted on picking up a prostitute with her in the car. Hearing this, I was very happy to have provided a safe and clean transport to this young girl in a less-than-preferable neighborhood.

Until we have 99.9+% reliability on driverless cars, being a driver is a very important job, and anyone doing it well is serving his community.

My last Uber driver was a former NYC cabbie, and he said he loved being able to wake up at 6AM, not 4AM, starting a pot of coffee and waiting for the app to alert him instead of having to be in his car.

Chris - I know what you mean about wondering if I am cashing out back end value of the vehicle for cash today.  We shall see. I also enjoy when I know I am helping someone get home safely from either a not great situation, or simply someone who knew they would have a few drinks so they Uber'd there and back. 

I too think soon enough the driverless car will take over.  It may be 5 years down the road, but it will happen.  Then the question will be is can I privately own a driverless car and profitably allow it to work for me giving others rides, or will Google, Uber, etc. corner that market.

[lcmac32]

5 week update numbers are as follows:

                          Income:      $3,376.28
                          Hours:              165.5
                          Rate:               $20.40/hr

I have tapered off on hours worked lately down from the almost 40 hours working 6 days a week.  Last two weeks were 30 and 26, the lower numbers were due to other commitments, which I predetermined would take precedence over the side hustle.  All in all still a good experience.  I will continue until my next side hustle starts Jan. 17, which will pay $25.00/hour without leaving the house.  Guaranteed 20 hours/week.