[ad_1] The post Uber vs. Lyft Driver: Which is Better? appeared first on Millennial Money. The time has come for you to make money as a rideshare driver. However, given the limited amount of rideshare platforms and conflicting reviews, you might feel confused when trying to decide which one to join. As you probably know, Uber and Lyft are the world’s most popular ridesharing apps. While they’re pretty similar overall, there are several noteworthy differences. To help guide your decision, this post dives into how they stack up. For starters, let’s answer the most important question. Which App Pays Drivers More? It’s almost a tie. On average, Uber drivers earn $16.77 per hour versus $16.33 with Lyft. Average earnings per mile come to $0.81 for Uber and $0.75 for Lyft. And earnings per trip amount to $10.58 for Uber and $10.02 for Lyft. One reason why Uber drivers typically earn a bit more is that Uber drivers tend to spend more time on the road. According to Gridwise, there’s a 4% difference in trips per hour between Uber and Lyft. So if your goal is to maximize driving time, Uber may be the better way to go. That said, there are a lot of factors that affect how much you can earn on each platform, which we will explore next. Key Factors That Influence Pay Location When it comes to pay, location is the most significant piece of the puzzle. According to Second Measure, Uber brings in the lion’s share of the U.S. rideshare market, generating 72% of spending. But in certain areas of the country, Lyft is way more popular. As it turns out, riders are more likely to use Lyft on the West Coast or Midwest than in the Northeast. And in January 2021, Lyft took in 44% of rideshare sales in Phoenix and Detroit—its highest percentage among the 15 most populous U.S. cities. With that in mind, make sure to pay attention to your local market instead of national averages. One easy way to do this is downloading both companies’ customer-facing apps and reviewing how many drivers are circling in your area. Average Trip Cost Uber and Lyft are both still adjusting to the post-pandemic economy—and customers are feeling the pinch. The main reason for this is because demand for rides plummeted during the peak of the pandemic. As a result, many drivers went on to find other work. Due to ridesharing being a demand-driven, market-based model, fewer drivers on the road means more competition for rides—and higher prices for riders. Second Measure found that Lyft’s average transaction value was $26 in August 2021, which was a whopping 47% year-over-year jump. In comparison, Uber’s average transaction value per ride was $20, reflecting a 20% increase from the previous year. When prices spike, customers usually push back. Most rideshare customers use both apps and toggle between them to get lower pricing. And if prices get too far out of control, customers are more likely to rent cars, carpool, bike, or use public transportation to get around. This impacts drivers because it means fewer passengers on the road and heavier competition with rideshare hustlers who are competing for pickups. For this reason, it’s a good idea to monitor pricing fluctuations over time. If you’re having trouble finding customers in your area, Lyft or Uber’s pricing could be the cause. While you can’t control how much the companies charge, you can decide where, when, and who you drive for. Commissions Unfortunately, pricing spikes don’t always lead to stronger profits for drivers because both companies take in high commissions. While Uber drivers typically generate higher hourly pay, the company takes 25% of the total fare. In comparison, Lyft only takes 20% of the total fare. In reality, Uber and Lyft commissions are often much higher, in the 30% to 40% range, after factoring in extra charges like airport fees and safety fees. The key lesson here is that it isn’t just about how much you earn with Uber and Lyft. It’s also about how much you keep. Both companies collect a fair amount of money from commissions at the expense of their drivers. On top of that, Uber and Lyft drivers also have to fork over a significant amount of expenses in gas and car maintenance. And while there are some discount options available (more on that below), these costs still fall squarely on drivers. There are also taxes to consider. As an Uber or Lyft driver, you work as an independent contractor. This means you have to pay the government a hefty chunk of whatever you bring in. This includes federal taxes, payroll taxes, and state taxes, depending on where you live. Winner: Uber With all of the above factors in mind, Uber’s 72% market share and higher hourly rate give it the earning potential edge for most drivers. So out of the two, I would pick Uber when considering total earnings averages. Next, let’s take a looko at how the platforms compare when it’s time to collect your dough. Cashing Out with Uber and Lyft Both Uber and Lyft issue weekly payments by default, and it’s easy to link your checking account in both apps to receive payment. If you go with the weekly payment option, it won’t cost you anything to cash out. But you’ll have to wait at least a week for your money to land in your checking account. Uber Instant Pay To streamline payments, Uber has Instant Pay, which lets you cash out instantly up to five times per day. But there’s a catch. Uber charges $0.50 each time you use Instant Pay. If you cash out multiple times throughout a shift, you could lose up to $2.50 daily in fees. That being the case, you’re much better off using the service just once per day to avoid fees. Uber Debit Card As a work-around, Uber provides a free, exclusive debit card for drivers through a partnership with GoBank. If you sign up, you
