One of the big advantages of the gig economy, and why so many people are entering it, is the ability to become your own boss. Whether you’re freelancing as a designer or driving ride-hail, you get to choose your own hours and volume of work. That sort of flexibility is ideal for those looking to add income as a side hustle.
We mentioned ride-hail specifically because it has become probably the number one side hustle these days, and the main reason is the accessibility of it. You don’t need a special skill, just a clean car and driving record. It raises the question – is buying (or upgrading) a car a good investment to earn more money?
Obviously, you need to weigh the cost of owning a car versus the potential income you can earn. How much do ride-hail drivers get paid, what kind of delivery driver jobs are out there, and what other ways can you monetize the use of your vehicles? We’ll answer these questions and more to give you a better answer to whether it makes sense to buy a car for the purpose of earning more money.
Rideshare companies like Uber and Lyft have massively disrupted the taxi industry and met fierce opposition in many cities for that reason. But you can’t deny one benefit of their ever-growing presence – it creates employment. Exactly how much can you earn driving for these companies?
According to Indeed, Uber drivers earn $29 per hour on average. Your earnings will depend on how many kilometres you clock up – the more you drive, the more income you’ll take in. Earning $100-300 per day is not unrealistic for an Uber or Lyft driver, and it’s possible to drive for both simultaneously. However, keep your health in mind, as driving full-time can be hard on the body. And don’t forget Uber and Lyft both take a cut of each fare you collect, around 25%. That’s $5 off every $20 you collect.
It’s also important to note that you are responsible for ancillary expenses like gas, vehicle upkeep, car payments, and insurance.
These expenses will also depend on where you live in Canada. A driver in BC, for example, is going to pay much more in gas expenses compared to a driver in Edmonton, where gas is routinely less expensive; often 40-50 cents cheaper per litre.
If carting around strangers all day and night isn’t something you aspire to, there are other ways to monetize the investment you made in a new car. Food delivery services have exploded in recent years, everything from McDonald’s to movie theatre concessions are offering their fare delivered right to your door. Big-name websites like Skip the Dishes, GrubHub, DoorDash, and Uber Eats, which all specialize in take-out delivery, will have you ringing doorbells if you’re willing.
The pay for food delivery driver jobs depends on a few factors. For example, a company like DoorDash, which outlines their payment structures on its website, offers a base pay that varies depending on distance travelled and the desirability of what you are ordering. That base pay ranges from $2-$10 per delivery, plus tips and “promotions” like delivering during peak delivery hours. Tips can be key to your income, which is why you must resist the temptation to snack on the food you’re delivering.
According to Indeed, Uber Delivery Drivers earn an average hourly salary of $17.73 per hour. How much you make will all depend on the time you put in, and like other food delivery jobs, Uber Eats offers flexible hours. You can work for any amount of time and get paid every week for the work you do.
Essentially, the base fare (pickup flat fee, dropoff flat fee, distance rate (per kilometre) & time rate (per minute)) gets multiplied by any promotions (Boost, Quest, Surge) that a customer selects. You’ll also get tips (which you keep 100% of). The app will add that all together to calculate your total earnings. Uber deducts a service fee from your earnings before tips.
You can cash out your earnings and tips at any time. Use the FlexPay feature on the app to transfer your earnings to your linked bank account.
One of the easiest ways to monetize your car is to turn your vehicle into, well, a marketing vehicle. There are companies that will pay you to put non-permanent advertising on your car. This is called income at its most passive.
A company like Drivertise will pay up to $250 a month, plus a car wash allowance, to use your vehicle as a billboard. Rates of pay are determined by the amount of your car’s exterior that is used. A full-body wrap could net you $250 per month, while a back window earns you $70. Of course, you need to be driving in order to earn that cash. You can’t just park it in the garage for a month.
If you live in the major cities in Canada, then you probably recognize those ubiquitous white vans double-parked all over town – the Amazon drivers searching for their packages’ recipients. Those are contract drivers, but you don’t need to buy a white van to join their ranks. Amazon Flex offers drivers with their own cars the opportunity to deliver same-day packages (usually between 2-4 hours). You’ll need to qualify under their rules, but if successful you can be earning between $22-$27 an hour.
We’ve talked a lot about all the ways you can earn income after buying a new car, but we haven’t addressed a core issue – is this meant to be a side hustle or your main gig? We recommend viewing this kind of work as a part-time gig (at first) for various reasons:
If you’ve ever used apps like Uber and Lyft, you’ll know that passengers get to see info about the car, including its make, model and age. So aside from the fact that older cars (typically over 10 years) don’t meet rideshare requirements, no one is going to choose an old beater over a shiny new ride with plush, clean interiors. So, if you’re considering entering the ride-hail game, you will need to invest in a better car if what your current vehicle is running on its last legs. Likewise, if you're delivering food or packages, you'll want a vehicle with plenty of cargo space that you can depend on.
But what about those car payments?
Well, that’s where the extra cash from the side hustle comes in. And your side hustle doesn’t have to interrupt your day too much either. For example, your commute to and from work is a rideshare opportunity. You can collect a couple of passengers who are going the same way and earn extra cash while you sit in traffic.
With the extra bucks you’re bringing in from driving, you can cover the car payments. Plus, newer cars usually have better fuel consumption and fewer maintenance costs, which means great savings in the long run.
Even if you have no money for a down payment there are options; it is possible to start driving (and earning) with a minimal upfront cost.
If you’re interested in a new vehicle for driving ride-hail or some other vehicle-based side hustle, you could get pre-approved online today at Canada Drives. Whether you have good credit, bad credit, or no credit at all, Canada Drives makes it easy for drivers to get approved for car loans
It only takes 3 minutes to apply, and you could be driving home as soon as tomorrow!
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