What Is a Rideshare Driver and How Do You Become One?

Again, a rideshare driver is someone who provides taxi services for a gig app like Uber or Lyft, accepting rides using their mobile device.

Most drivers use their own vehicles, but you can also rent one. As a driver, you’ll essentially work on a freelance basis, setting your own hours and choosing to accept or decline jobs as you see fit.

How is a rideshare driver different from a taxi driver?

Rideshare drivers and taxi drivers do essentially the same job, but there are still significant differences between them, especially when it comes to their:

• Employment structure: Taxi drivers are usually traditionally employed by companies. In contrast, rideshare drivers work for gig apps and are legally classified as independent contractors, not employees.
• Schedules: Rideshare drivers have very flexible schedules, since all major rideshare apps let you choose when and how much you want to work. Taxi companies generally expect their drivers to stick to set hours (even when they only work on a part-time basis).
• Vehicles: As mentioned, rideshare drivers either use their own cars or rent a vehicle from one of their gig app’s affiliates, whereas taxi drivers drive company vehicles.
• Rates: Taxi drivers usually charge by the meter. Rides on gig apps usually have fixed prices and are often (but not always) cheaper than rides from conventional cabs.

Becoming a rideshare driver is also easier than becoming a taxi driver. You don’t have to get a chauffeur’s license (or any special credentials beyond an ordinary driver’s license) or go through a job interview.

As long as you have an appropriate vehicle, a relatively clean driving record, and no substantial criminal history, you can sign up and be confident you’ll be accepted as a rideshare driver.

Pros and cons of being a rideshare driver

If you’re thinking about trying your hand at ridesharing, here’s a quick list of the pros and cons of this side hustle.

In general, rideshare drivers usually earn around $10–$15 per ride, which translates to between $20 and $30 per hour. We’ve talked to several experienced drivers, including Matt Miller (who told us how much Uber drivers usually earn in his market) and Aaron Lawrence (who did the same for Lyft); both corroborated these figures.

However, rideshare drivers’ earnings are affected by quite a few factors. This means that there’s a lot of variation in the earnings that they report. Some drivers claim that they’re able to make $200–$300 per day (driving for 5–8 hours), whereas others struggle to make even $50 in a day.

Factors that affect your earnings as a rideshare driver

The factors that affect your income as a rideshare driver include:

Your location

Where you’re located makes a big difference when it comes to:

• The number of customers you have access to
• How much rideshare apps will pay you per ride

You can find more (and better-paying) rides in large, dense cities. In smaller towns where people tend to have their own cars, there isn’t as much of a market for taxi services, which makes it harder to land gigs and earn money.

However, the situation is slightly more complicated than “ridesharing in cities is always more profitable.” Traffic is also heavier in urban areas, which will slow you down, limiting how many jobs you can do per day and forcing you to burn more gas per ride, lowering your profit margins.

Ridesharing in genuinely rural areas usually isn’t worthwhile, but sometimes, you can earn as much or more driving in suburban neighborhoods as in downtown urban centers.

When you drive

Certain times of the day see higher demand, particularly rush hour. A surge in demand means that fares will increase.

What days you work also affects the demand for your services. Weekends and holidays are often busier, especially at night. Many rideshare drivers prefer to work in the late evening, when the restaurants and bars start closing.

Competition

The downside of driving in busy areas during peak hours is that many other rideshare drivers will have the same idea.

If there are a lot of other Uber or Lyft drivers on the road, they may snap up the most lucrative gigs, making it harder to land high-paying work. The app you’re using may also lower its rates because it doesn’t need to offer any special incentives to get enough workers to meet the demand.

It’s best to drive when there are a lot of customers in the area and there aren’t many other rideshare drivers working. However, doing that is easier said than done; it requires a lot of ridesharing experience, as well as familiarity with your neighborhood.

Promotions and surge pricing

During periods of high demand, such as after concerts and sports events, rideshare apps automatically increase their base fares, meaning you’ll make more per trip.

Additionally, both Uber and Lyft feature occasional “promotions”—extra cash for completing certain tasks or challenges, such as accepting a particular number of rides during a set timeframe.

They use these to encourage gig workers to drive during periods when there are a lot of customers (or when, for whatever reason, there aren’t many rideshare drivers willing to get behind the wheel).

Tips

Customers on rideshare apps can tip their drivers. This is optional, and not everyone will do it, but some will. You’ll get to keep 100% of whatever you receive; no rideshare apps currently take a cut of their workers’ tips.

Going the extra mile to earn more tips (i.e., doing your job as well as you can, with a good attitude) will do a lot to boost your profits.

Expenses

Lastly, your expense ratio will heavily affect how much you can make by driving for gig apps.

Companies like Uber and Lyft don’t compensate their gig workers for fuel or their other expenses. As a rideshare driver, you’ll be responsible for those yourself. Your costs will include (but won’t necessarily be limited to):

• Gas
• Vehicle maintenance (i.e., regular touch-ups at the auto body shop)
• Rideshare insurance, if your regular auto insurance policy doesn’t cover ridesharing
• Taxes (look into the Uber tax deductions you can take to minimize these)

Exactly how much these will chip into your profits depends on several factors, including how fuel-efficient your vehicle is and how much you earn in total, which will affect your tax burden.

However, the rideshare drivers we’ve interviewed have suggested budgeting at least 35% of your earnings for unavoidable expenses like this, meaning you’ll be left with 65% of what you originally made.

Effectively, this means that if you’re able to earn $25 per hour, which is in the middle of the range we listed above, your take-home pay will be around $16.25 per hour—not nothing, but less than you might have been expecting.

As you’ve probably gathered, in the US, there are two main rideshare apps: Uber and Lyft. We’ve reviewed both of them, and you can see quick overviews of them below.

Uber

Uber is the app that most people try first when they get into this side hustle, and for good reason; it’s the most popular rideshare service in the country, reportedly cornering more than three-fourths of the market in 2024. 1

You can get a bonus as a new Uber driver in the form of an earnings guarantee, which essentially ensures you’ll earn a certain amount of money for a specific number of rides. In addition, you can boost your earnings by driving for Uber Black, a premium service of Uber. Some Uber drivers may even sell products to their passengers, side hustling on their side hustles.

Lyft

Lyft works almost exactly the way that Uber does, although it’s run by a different company. Although it has fewer users overall, it’s more popular than Uber in certain neighborhoods—there’s a lot of regional variation when it comes to which rideshare apps people prefer.

It’s possible to download and drive for both apps. Doing so isn’t a violation of either’s terms of service, and won’t get you banned from the platforms.

In fact, it’s possible to keep both apps up simultaneously, accepting rides from whichever happens to be paying more at any given moment. That’s a very common practice, and it’s one of the best ways to make more money as an Uber or Lyft driver.

Becoming a rideshare driver is easy. All you have to do is confirm that you’re eligible to drive for Uber or Lyft, then sign up in their app or on their website.

Who’s eligible to become a rideshare driver?

The criteria you’ll need to meet to be a rideshare driver vary from app to app and sometimes from location to location (different states have slightly different legal requirements).

However, in most areas, Uber’s requirements and Lyft’s requirements are quite similar. To start this side hustle, you’ll need to meet these criteria:

• Age: You must be at least 21 years old.
• Experience: You must have at least 1 year of driving experience (3 years if you’re under 25 years old).
• License: For obvious reasons, you must have a valid US driver’s license, although it doesn’t need to be issued by the state you plan to drive in.
• Vehicle: If you plan on driving your own car instead of renting a car with Uber or Lyft (which is the case for most rideshare drivers), it must be a four-door vehicle, have passed a vehicle inspection check, and be a relatively new model (which often means it must have been made within the last 10–15 years).
• Insurance: You can’t drive for a rideshare service without insurance. Again, many auto insurance policies specifically exclude commercial driving, so you’ll need to call your insurer to see if you’re covered and buy additional insurance if you aren’t.
• Background: All major rideshare apps conduct background checks on potential drivers. These aren’t very stringent; you’ll pass unless you have felony convictions or major vehicular offenses (e.g., a DUI) from the past 7 years.

Because the specific requirements you’ll have to meet are variable, you should confirm them by visiting the website for the app you want to drive for. It will tell you whether there are any other state-specific criteria you need to meet.

How to sign up for a rideshare app

Uber and Lyft have very similar sign-up processes.

Signing up with Uber

To start driving with Uber, follow these steps:

1. Visit Uber’s website and click Sign up to drive
2. Enter your personal information (including your phone number, name, address, and Social Security number)
3. Submit a photo of your driver’s license, vehicle registration, and proof of insurance
4. Agree to let Uber run a background check on you
5. Take a selfie to serve as a profile picture in the Uber app
6. Wait for the results of your background check to come in

You may have to wait anywhere from a few minutes to one week. Once Uber approves you, you can start driving for them right away.

Signing up with Lyft

Again, Lyft’s sign-up process is nearly identical to Uber’s. You just need to:

1. Visit Lyft’s website, enter your phone number, and click Apply to drive
2. Enter the rest of your personal information (including your Social Security number)
3. Submit a photo of your driver’s license, vehicle registration, and proof of insurance
4. Agree to Lyft’s background check
5. Take a selfie to serve as a profile picture in the Lyft app
6. Wait for the results of your background check

Lyft contracts with the same company to conduct background checks that Uber does (Checkr), so your waiting time may also range from a few minutes to a week. Here again, you can start driving as soon as your background check clears.