How To Be A Rideshare Driver
Rideshare services are active in many cities in the United States, including metropolitan areas like Los Angeles and New York, as well as smaller locales with diminutive populations. No longer just for the big cities, more and more people are getting into offering these rides with their own personal vehicles.
Working for ridesharing services means flexibility when it comes to being your own boss and setting hours, but there are a few things you need to know before you take to the road. Use this guide if you want to become a Lyft driver, Uber driver, or both.
Becoming A Rideshare Driver is a Good Source for Additional Income
If you’ve got a relatively new car, enjoy being behind the wheel and you want some extra income in your life, putting one of those pink mustaches or an Uber sign in your window can be tempting. For many people, being a rideshare driver for Uber and Lyft can be an excellent source of secondary income.
With Uber and Lyft, you can set your own hours and hit the road to pick up passengers on your own terms. While there are often incentives for busy drivers, neither company can push drivers to take on more rides than they really want to.
As a driver, you’ll also be able to set your own hours, which can help you work around an existing job. For example, if you work in the service industry and get off work at midnight, adding a few extra hours to your schedule for post-bar pickups may be lucrative. Of course, you can always take on early morning or afternoon rides, too.
Proper Car Insurance
Using your car as a source of income means you need reliable insurance. Rideshare services like Uber and Lyft often require top-tier insurance as well. Lease agreements on vehicles have special insurance requirements, too.
For most drivers, the best insurance packages are comprehensive ones. These cover damage to another driver’s vehicle and your car if you’re in an accident. You’ll also want to look into the amount of coverage your insurance provides for passengers who may be injured in an accident whether it’s your fault or not.
Uber and Lyft will help you understand minimum insurance requirements as well. Most rideshare services also offer a basic supplemental package to drivers to guarantee safety on and off the road.
Driving for Multiple Services
Uber and Lyft are different businesses, but many rideshare drivers are picking up routes from both companies. Registering with both is relatively easy as long as you meet their car and background check criteria, and in general, if you qualify to drive for one service, the other will accept you as well.
If you do drive for both services, it’s easy enough to switch between apps when you’re safely off the road. Third-party apps can help you track both rideshare services and available fares from one place, but some charge a fee for this service.
However, you do it, driving for both Uber and Lyft can help increase your profits in many cases. Just be aware that sometimes during the year rideshare services may offer bonuses for busy drivers, so working with one service only could be more profitable then.
Check Local Regulations
Local regulations dictate if and when you can drive for a rideshare service. While many cities have opened up almost all locations to rideshare services, others are more restrictive in places like the airport.
Before you start driving, check local regulations about what rideshare drivers can and cannot do in your area, as well as where you’re allowed and prohibited within a region. More info about local, state and national regulations can be found on the Department of Transportation (DOT) website.
Getting Ready for Tax Time
Driving for a rideshare service, even if you do it part-time only, needs to be viewed as running a small business. If you neglect the financial aspects, you’ll miss out on deductions that could help you save money. That’s going to make your rideshare rendezvous a whole lot less profitable for you.
To make sure you’re ready for tax time, keep these records in an organized manner:
- Keep track of miles you drive for deductions. A daily, weekly and monthly tall will make preparing your taxes easier.
- Save receipts from car repairs and basic maintenance. If your car is income, keeping your business machines in tip-top shape can be part of your write-offs.
- Keep gas receipts. Portions of your gasoline costs may be used as write-offs depending on the number of miles you drive.
If you’re unsure about how to prepare your taxes, online classes and instructional videos for single-person business owners can be helpful. Hiring somebody to handle your taxes – at least your first year as a rideshare driver – can also help you save since you’ll get the most deductions possible. You’ll also learn what to do next year!
Prepare for Wear and Tear on Your Car
Driving for a rideshare service can help you bring in extra money, but it will undoubtedly take a toll on your vehicle. For that reason, you need to prepare and put some money aside for repairs and an eventual upgrade.
While there’s no exact going rate for car wear and tear in the rideshare business at this point, most companies offer employees who use their vehicle for work just under $0.61 per mile for wear and tear. If you can, put that money aside each week to ensure that you’ll be able to make repairs and shop for a new car to keep up your rideshare route when the time comes.
Operating as a rideshare driver for Uber, Lyft or both can help you pocket some cash in your spare time. Before you start though, do your homework and develop a game plan. Otherwise, things like routes, insurance, taxes and car maintenance can come back to cause you problems down the road.
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