How to Make Money With Uber

Here at Dough Roller, we’ve talked a lot about side hustles — the work or business you run alongside your day job to earn extra cash. Whether you’re looking to pay off debt, save more money, or just have some extra cash for expenses, having a secondary gig can be a huge help for your bank account. Plus, the right job can give you a fun, productive way to spend some of your spare time.

One newer side hustle idea to add to your list is Uber. This ride-sharing service has gotten some bad press in recent days, but it can still make a lucrative side gig if you use it correctly. However, that’s the caveat: in order to make decent money with Uber, you’ve got to know the tips and tricks.

uber

Uber as a Side Hustle: Two Stories

One of the guys in my neighborhood started using Uber several months ago as a way to bring in extra income for his family. He has a full-time job and family obligations, so he normally makes himself available to drive late on Friday and Saturday nights. With consistency and understanding of the local market, he’s turned it into a tidy little side hustle. Some weekends are a bust for him, but on others, he pulls in as much as $1,000.

Seeing our friend making really good extra money, my husband decided to jump on the Uber train. His experience? Not so great. A few weekends, he only made $20 — and that was before accounting for the extra gas and wear and tear on our car. The low income combined with the lost sleep (resulting in an off-kilter weekend for our two small children who wanted to play with Daddy in the morning) made Uber not worth his time.

So, what gives? Why the two wildly different experiences? And how can you make sure Uber is a worthwhile side hustle if you try it? Here are some tips gleaned from first-hand experience.

1. Know your local market.

The absolute most important part of making Uber a successful side gig is understanding your local market. You need to know when and where to drive for the best, most consistent fares.

This was part of my husband’s problem starting out. His latest Uber experiences — after learning a bit from our neighbor, which helped — have been much better. Our neighbor also spent some time floundering around until he found his rhythm. Then, he was able to make the most cash in the smallest amount of time.

It’s not uncommon for fares and demand to be higher on late Friday and Saturday nights, especially in downtown areas and other places where people are likely to be barhopping. Responsible drinkers will Uber to their first bar early in the evening, but then the demand is more spread out. Closer to closing time, you’re likely to see a rush of partygoers, done for the night and ready to go home.

You’ll also want to learn how Uber reacts to certain events in your hometown. In Indianapolis, for instance, pricing tends to surge around Pacers and Colts home games. This is when downtown is flooded with extra people — many of whom would rather Uber to and from the game, than try to find parking.

Live In a Popular Area? Pay Your Mortgage With Airbnb

There are two good ways to get to know your local market: talking to other Uber drivers and looking at the passenger app.

Talking to other drivers is the most efficient way to glean information. Plus, they’re usually forthcoming with tips and tricks for your local area. After all, when your town is known to be Uber-friendly, that creates more demand for every driver!

But another option is to log into the passenger app. Downtown on a Friday night? Log in to see how many drivers are near you, and what fares look like. Just getting familiar with when and where people are most likely to request rides can direct your efforts as a driver. That way, you can make more money in less time.

2. Drive the right kind of car.

More than anything else, this was probably the key that separated my husband’s earning potential from that of our neighbor. My husband was Ubering in our Chevy Equinox, a crossover that doesn’t hold enough people to qualify for UberXL. Our neighbor drives his family’s mini van, which qualifies for UberXL.

Because you can take more people with an UberXL ride, fares are higher. Plus, being able to take both UberX and UberXL fares can keep you much busier than if you’re restricted to UberX. You can still try Uber driving if you have a smaller vehicle, but you may not make as much money as another driver with a larger van or SUV.

What if you don’t currently have an XL-sized vehicle? You’ll have to run the numbers to decide if a larger vehicle is a worthwhile investment. It could be if you decide to drive for Uber frequently and live in an area where drivers can make a consistent income.

Related: Should You Buy a New Car?

Those who want to drive for Uber on a more full-time basis might consider in investing in a vehicle worthy of the Uber Black status. These business-ride vehicles make premium fares, but must be black (of course!) and need to be newer than Uber requires for X or XL vehicles.

3. Don’t chase the surge fares.

When there’s a high demand and low supply in any one local area, Uber increases their rates to account for “surge pricing.” This happens most often during holidays, closing time in popular bar areas, and after local events. Riders approve the fee when requesting a ride, knowing that they’ll be paying more for the convenience.

When a surge fare is warranted, Uber will push out text alerts to drivers in that area. They’re trying to make sure the demand for rides can be met, so they get more satisfied customers — and drivers, knowing that a surge means higher fares for them, will often try to time their driving around these increases. However, chasing surge pricing can actually have an opposite effect of what you expect.

The problem? When a bunch of drivers follow that text to take advantage of surge pricing, supply quickly increases, which means prices fall back to their normal levels. You’re better off simply knowing where there’s likely to be high demand, and sticking to that area steadily.

4. Find a place to wait

When you’re in between rides, it can be tempting to drive around in circles, hoping Uber will ping you because you’re closer to a potential ride. But here’s the thing: driving in circles doesn’t make it that much more likely that you’ll get more rides. It puts more wear and tear on your car and wastes gas. Of course, both of these will reduce your net income from this side gig.

Car Repair Bill? See If It’s Emergency Fund-Worthy

Your best bet is to know of a few places where you can park and wait for a while. Stick close by areas where you’re likely to pick up rides, but don’t drive or idle your car. In some areas, finding free parking like this can be easier said than done. But again, getting to know your local area makes a huge difference here.

Oh, and while we’re talking about this, be sure you also have something to do while you wait! Bring a book or download a podcast. Either way, be prepared for days or evenings where you have to wait in between rides.

5. Use Back to Back Rides

Uber drivers used to be frustrated by long wait times between rides. You’d drive from one area of town to drop a rider off, but then wait a long time before picking up another ride. Or you’d have to drive several miles to get to your next ride.

In 2015, Uber introduced its Back to Back Rides feature. This helps reduce that wait time by allowing you to accept a new ride that’s close to the end of your current ride’s route. In fact, you can accept the new ride while you’re still driving your current ride. Then, as soon as you hit End Trip, you’re on to your next pickup.

You don’t need to do anything special to take advantage of the Back to Back Rides system. You just have to be aware that it’s available, and watch for new rides to come in while you’re in the middle of a ride.

6. Toggle between systems, if you can

One way that my neighbor has made more of his driving time is to use two different ride-sharing systems: both Uber and Lyft. The car qualifications for Lyft are a bit more stringent, but if your car qualifies, you can actually work as a driver for both systems.

Here’s how it works:

  1. When you start your driving period, log into both Uber and Lyft.
  2. When you get a ride from one system, log out of the other.
  3. Complete the ride, and any back to back rides you might acquire.
  4. If you find yourself waiting again, sign back into the other system, too.
  5. Repeat.

By using both systems at once, you can stay busier and keep away from those profit-eating lag times. Just be aware that you’ll use a lot of data for this process. You’ll probably need to keep a phone charger handy, too, because it’ll suck your battery dry really quickly!

One other note: Uber won’t keep running if it’s a background app, but Lyft will. So run Uber as your main app, and keep Lyft running in the background.

What should you do if you get two rides at the same time? Accept the one with the starting point closest to you, and decline the other before logging out of the app.

Related: How to Earn More and Have Fun With a Side Hustle

Whether Uber (or Lyft) is a good side gig option for you depends a lot on your schedule, where you live, and the vehicle that you drive. However, if you have the right availability and are near a high demand area, it might be a great way to bring in some extra cash on the side. If you want to learn more about rates, requirements, or to sign up to be a driver, visit their site here.

These are just a few of the tips I’ve learned from my neighbor and my husband, from their experiences with driving for Uber. Hopefully, they will help you make the most out of this app and increase your profits. If you’re trying to pay off debt, save extra money, or fund something like a special vacation, every dollar counts!

Do you drive for Uber or Lyft? Share your hard-earned tips and tricks with us in the comments.


Topics: BudgetEarn Extra IncomeMake MoneyPersonal Financesmall business

Leave a Reply