# HOW TO: Calculate your vehicular expenses



## FXService (Oct 8, 2017)

This is for you, newbies. Welcome to UP! I'm glad you have found us, and we have created a treasure trove of information for you! (Mods sorry in advance if this is posted in wrong forum) While you will find amazing strategies to increase your revenue, I'm here to remind you of that minus sign hanging out near your new and improved revenue stream. **** that minus sign when it's getting too close to your dollars, right? Well, too bad. It isn't going anywhere. But you can find out just how big of a jerk King Minus is when it comes to your car. Your place of business. I've posted before how to calculate your expenses in this business. However, after going through my previous posts I can't find it. It's a combination of cost per mile (consumables) and cost per day (services, etc). I'll explain below:

*Consumables:*

Basically, your consumables are things like tires, gas, brake pads, any maintenance really. This is calculated like this. *Cost/miles*. So, gas would be *$2.50/25mpg= $0.10 /mi*, oil change, *$30. /5000=$0.006 /mi.* (I always use 1/10 of a cent because you start adding up tires, brakes, spark plugs, struts, rotations, fluid changes, depreciation, many of these will be closer to *.5* to *1* cent/ mile but they do add up over a 100k miles. So even neglecting a *$0.01 per mile over a period 100k miles means $1,000*.) My tires were $*675* when I replaced with 80k mile Michelins, I can realistically expect about 70k. *$675/70,000=$0.01 per mile.*

*Services:*

Your "services" are things like insurance, registration, car wash, etc. The formula I use for this is *Cost per year/365=daily cost. *I prefer breaking it down into a daily cost because it's a very convenient unit to work. easy to determine a week (*x7*), month (*x 28 to 31*), etc. This is often an overlooked or misunderstood cost, especially for Part-timers. because for you guys, the formula is *daily cost x N%. *(If anyone needs help with this let me know). Also, a lot of people say insurance, registration, etc aren't legitimate to consider expenses since you must pay them anyway. That's *Bullshit*, especially if you have a commercial or RS policy/endorsement. Do you think the brick and mortar store doesn't consider their cost of insurance a legitimate expense just because it must be there anyway? I'd also like point out that ALL these expenses are the true cost of owning a car in general, it's just as transportation providers we burn through this A LOT quicker than most people and which is we need to be aware of it.

*Depreciation:*

Depreciation is a bit tricky because it's based on age + mileage. And even then, age is usually weighted over mileage. How much age trumps mileage in depreciation really depends on make/model/trim, etc. _I could write_ _an entire thread dedicated to depreciation only._ However, for the sake of this post we will be using the Edmunds 5-year/ 15k mi/yr cost to own and look at the total depreciation and converting that into a *consumable*. This keeps it simple. Now, we divide by 75,000 (15k x 5).

So, take a *2012 Prius*:

We have depreciation over *5 years, $8,446/75,000=0.113/mi*. Depreciation is ALWAYS hardest the first year but after that goes on a slow decline. Also concerning depreciation, for you guys driving 5-year-old or older beater for X and XL, you can even not factor in depreciation as the car will have been so depreciated already (to a resale value of 1,500-3,000) that honestly scrapping the vehicle would be as much if not more than you could make in a resale.

Also, the reason why I posted depreciation separate is because of those guys using vehicle model years 3 years old or newer and trading it in. You will most likely find that when you do go to trade in on a vehicle 3 years old or newer that your depreciation using this formula is understated due to depreciation being more the newer the vehicle. Blue Book guides will corroborate this to a degree. This math isn't exact as depreciation itself is a fluid value just like gas and can change daily depending on the market.

Whew, that's a lot of math! So, what does this mean for you and your rideshare/livery business? It means it's number crunching time. Now we are going to figure out how to put all these numbers together and find out just how much our business costs over varying lengths of time. Logging this data will greatly help you discover trends, make informed decisions, and give you better control over your business. If you have a basic understanding of Excel, you could even make a spreadsheet to help you track this and let you create year over year, month over month, trends. One of our more successful drivers/fellow forum members in the Phoenix market, Jdemonto , does this and uses this data to vastly improve his revenue and lower costs. Onto the math. CHARGE!

*2012 Prius**

*Consumables (not 100% inclusive and calculated using 2012 Prius service schedule, link: https://www.driverside.com/service-schedule/complete/toyota-prius-2012-30842-53634-133862 ):*

Depreciation: $0.113

Gas: $0.058 (using $2.85/gal as national average)

Oil changes: $0.004 (@ $40/10,000)

Tire rotation: $0.004

Alignment: $0.004 (assumed $70 for wheel alignment. Usually FWD cars in this business need them about every 15-25k, I estimated 20k)

Air Filters: $0.001 (combined cost of $25 for both engine and cabin at 20k miles. Please don't tell me you're paying someone to do this for you. If you own a screwdriver you can replace an air filter on ANY CAR)

Tires: $0.008 (*MICHELIN *DEFENDER T + H*195 /65 R15 *at $523 from Discount Tire and assuming 70k useful tread out of 80k manufacturer, these are also damn good tires and you can usually catch them on sale at Costco)
Spark plugs: $0.001 ($131/120k mi)

Coolant flush: $0.004 (at $188.50 every 50k)

*Total: $0.197/mile*

*Services:*

Insurance: $10 ($3650/yr for math simplicity)
Registration: $1 ($365/yr)

Car Wash Pass: $0.99 ($30month x 12/365)

Market specific fees, licenses, etc: $x.xx

*Total: $11.99/day*

Ok, now let's start putting this together and working with it. First, we are going to determine how much your expenses are just for today.

So it's the beginning of your day, you're just waking up, getting coffee, etc, checking your trips from last night, nope still no tips but they did leave a 5 star and thank you for the 3 waters they drank, checking out the surge maps, and oh you haven't even turned on your car yet, but it doesn't matter, you have still spent *$11.99* today running your rideshare business. So, you sit on the couch, reading UP, and you get your first ping! WOO HOO! You drive, 3 miles 10 minutes' drive to pick them up, take them 20 miles/25 minutes to the airport and you get a rematch, another ¾ miles and 5 minutes unpaid circling the airport and you pick up pax, and take them 15 miles in about 20 minutes. Now at this moment you have driven 38.75 miles over an hour. Well, your *consumable* expenses are *$7.63.* So,* $11.99 + $7.63=$19.62.* Now we're going to assume you get $0.75/mi, $0.075, and $0.90 base fare. So, gross revenue is:

*35 x $0.75 + 45 x $0.075 + 2 x $0.90 = $31.43*

Now calculate net revenue:

*$31.43 - $19.62 = $11.62*

Now to get a realistic picture of your earnings add up all your miles driven that day and multiply by your figure from adding your *consumables*. Then subtract that and your *services* daily cost from your earnings for that day. This will be your net or take home.

Now, we're going to calculate a week (most of you should have this figured out by now, but just in case you don't, here it is.)

*Net Revenue by day
*
MONDAY: $178.63

TUESDAY: -$11.99 (Look at who's being lazy and taking a day off and sitting on their couch all day)

WEDNESDAY: $164.79

THURSDAY: $162.48

FRIDAY: $298.36

SATURDAY: $301.23

SUNDAY: $145.07

*Total: $1238.57***

**These figures are not meant to be used as a factual example of real world earnings. Just merely a simulation to explain the math.

Your net will vary depending on number of loaded miles versus unloaded miles. I hope this helps. Just because you don't physically swipe your card or pay cash does not men you are not spending money. The purpose of this post was to help you understand your expenses which go far behind just gas and coffee. I know this post is long, but I really hope some of you new guys use it to make the most of your business and wish you all the best of luck.

~FXService

***I've never owned a Prius, this is purely hypothetical for educational purposes. I attempted to get as realistic as possible, but please do your own research when calculating these figures for yourself

****These figures are not meant to be used as a factual example of real world earnings. Just merely a simulation to explain the math.

Optional number cruncher soundtrack:


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## Oscar Levant (Aug 15, 2014)

FXService said:


> This is for you, newbies. Welcome to UP! I'm glad you have found us, and we have created a treasure trove of information for you! (Mods sorry in advance if this is posted in wrong forum) While you will find amazing strategies to increase your revenue, I'm here to remind you of that minus sign hanging out near your new and improved revenue stream. &%[email protected]!* that minus sign when it's getting too close to your dollars, right? Well, too bad. It isn't going anywhere. But you can find out just how big of a jerk King Minus is when it comes to your car. Your place of business. I've posted before how to calculate your expenses in this business. However, after going through my previous posts I can't find it. It's a combination of cost per mile (consumables) and cost per day (services, etc). I'll explain below:
> 
> *Consumables:*
> 
> ...


Why bother? The standard deduction is actually more generous than itemizing, and a lot less work. (Valid only in the USA ).


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## FXService (Oct 8, 2017)

Oscar Levant said:


> Why bother? The standard deduction is actually more generous than itemizing, and a lot less work. (Valid only in the USA ).


This has nothing to do with taxes whatsoever. Even if you don't pay taxes on this income, there is still expenses...


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## SibeRescueBrian (May 10, 2015)

https://uberpeople.net/pages/EarningsCalculator/


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## Oscar Levant (Aug 15, 2014)

FXService said:


> This has nothing to do with taxes whatsoever. Even if you don't pay taxes on this income, there is still expenses...


Isn't it true that things like depreciation, gas, are not necessary to account for if you take the standard deduction?

I get it, you just want to know all that stuff. That's fine, I'm way too lazy.


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## FXService (Oct 8, 2017)

Oscar Levant said:


> Isn't it true that things like depreciation, gas, are not necessary to account for if you take the standard deduction?
> 
> Food, yes, but the other stuff, it's included in the standard deduction, right?
> 
> Way too much work. If i were running a fleet of cars, sure, but one man on one car? Why bother. I've been driving for 4.5 years, and only keep a record of food and mileage.


How many times have you taken Uber or Lyft as a passenger? I've done it many times. The majority of my drivers show up in newer model cars. Hell I was telling SibeRescueBrian that I got picked up in brand new Jaguar XF one time on X. One lyft driver I casually talked to had just bought a brand new 2017 Camry SE strictly for rideshare. he had for "about 3 months." odometer read 35k and some change. another guy had a 2016 RAV4 for a year, he also bought new for this gig. 75k mile. dash lit up like a christmas tree with CEL and other systems warning. and transmission shifted roughly. Most cars are lucky to last to past 250k miles. if you have people putting 80k a year on brand new vehicles and with banks becoming ever stricter and raising interest rates on financing people who have rideshare as their only source of income. The standard deduction goes out the window when it's time for a new car and you can't buy it outright. A subprime interest rate on a 18k loan or higher will easily out pace 3 years of the standard deduction. Sure people should only be driving beaters for X, XL, and even Select to be honest, but the reality is, they don't. And if I can help just one person sit down and figure out if this is for them or not and save them from massive debt down the road I'm ok, and I feel it's worth the effort. And if my super itemized expense how to can help some dude in a beater or looking for a beater maximize his earnings by realizing his expenses and minimizing, then again, it is worth it.

Also, I didn't even factor in food. that post is 100% just about the vehicle. Your dry cleaning for your suits, your lunch, etc, that's additional.


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## emdeplam (Jan 13, 2017)

Great list even if you dont drive for Uber. Basically expenses of owning a car. It's more expensive than just the price.

Great to have a gig to offset those expenses...otherwise it a just owning a car.

If you work from home by this logic you should depreciate your home, add all appliances bought, heating cooling etc.. . Who can afford to work from home.


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## Merc7186 (Jul 8, 2017)

Smart drivers dont buy brand new vehicles for doing ride share. Buy a used, cheap vehicle that runs decently, interior clean and exterior decent and away you go.

Explaining depreciation to most people is pointless. I am a Fixed Asset Analyst for my company and have had guys argue depreciation on my 2007 Town and Country that I paid $4600 for...and tell me that it is still depreciating. 

Simple math....$5 an hour of driving should be dedicated for gas, maintenance and depreciation (or replacement car fund)


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## FXService (Oct 8, 2017)

Merc7186 said:


> Smart drivers dont buy brand new vehicles for doing ride share. Buy a used, cheap vehicle that runs decently, interior clean and exterior decent and away you go.
> 
> Explaining depreciation to most people is pointless. I am a Fixed Asset Analyst for my company and have had guys argue depreciation on my 2007 Town and Country that I paid $4600 for...and tell me that it is still depreciating.
> 
> Simple math....$5 an hour of driving should be dedicated for gas, maintenance and depreciation (or replacement car fund)


I also pointed out that people with older vehicles shouldn't worry about depreciation. to be fair even my 2012 Prius is a bad example of depreciation.

assuming 300k miles depreciating at $0.113 a mile that comes out $33,900. Was a base model Prius even that much new in 2012? lol

Also, as I said in a reply to another member. There aren't a lot of smart drivers out there. How many newer cars do you see with U/L stickers?


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## oldfart (Dec 22, 2017)

Good job but I take issue with your method of calculating depreciation. For a full time rideshare driver 15000 miles a year is not a realistic number 75000 miles is more like it. and I would further argue that when you put that many miles on a car , mileage is more important than years

But my bigger point is that depreciation dosent matter. I know depreciation is a cost but what’s more important is not keeping track of how much value of your current car loses each year but rarher what you need to prepare for your next car.

So it’s one thing to calculate that your depreciation is 11 cents a mile what’s more important that you are prepared to buy a new car when the old one is finally junk or befoe, if that’s what you want

For example I paid $25000 for a 5 year old Ford Explorer I put it into rideshare 2 years later when it had 70000 miles on it. I estimated the value at that time to be $20000. I’m driving at the rate of 6000 miles a month and plan (hope) to replace the car after 3 years when it will have about 300000 miles on it and it’s value near zero. So $20000 over 200000 rideshare miles is 10 cents a mile

Now that’s an important number to know but more important is a plan for a new car. My plan is to buy a big expensive luxury suv $40000
So after 200000 miles on my Ford I should have $40000 set aside for the new car. Which is 20 cents a mile

Now if I planned to buy another used Ford Explorer my number would be 10 cents a mile. Or a used $10000 used Prius 5 cents

So the depreciation number is nice to know but not important especially if you use the 54.5 cent standard mileage deduction. Whats important at least to me is the “replacement number” 

And what’s most important to me is that I have that money when the time comes. In other words have reserve account and add to it every month


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## reg barclay (Nov 3, 2015)

FXService said:


> This is for you, newbies. Welcome to UP! I'm glad you have found us, and we have created a treasure trove of information for you! (Mods sorry in advance if this is posted in wrong forum) While you will find amazing strategies to increase your revenue, I'm here to remind you of that minus sign hanging out near your new and improved revenue stream. &%[email protected]!* that minus sign when it's getting too close to your dollars, right? Well, too bad. It isn't going anywhere. But you can find out just how big of a jerk King Minus is when it comes to your car. Your place of business. I've posted before how to calculate your expenses in this business. However, after going through my previous posts I can't find it. It's a combination of cost per mile (consumables) and cost per day (services, etc). I'll explain below:
> 
> *Consumables:*
> 
> ...


Deducting the amount you spent at the gas station from gross income, and remaining in blissful ignorance of maintenance, repairs and depreciation, sounds a lot easier.


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## oldfart (Dec 22, 2017)

reg barclay said:


> Deducting the amount you spent at the gas station from gross income, and remaining in blissful ignorance of maintenance, repairs and depreciation, sounds a lot easier.


As long as you have a back up plan. just in case

I had a passenger the other day that told me about the accident a past Uber driver she had, had with her in the car. He needed a tow truck but didn't have the money or credit to pay for one. She said she paid

Im guessing he won't have the money go repair the car or buy a new one or if he's insured to pay the deductible. And even if the other guys insurance pays, he's going to be out of business for a while

Stories like this are why it's important to have some savings or good credit.


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## reg barclay (Nov 3, 2015)

oldfart said:


> As long as you have a back up plan. just in case.


I agree, I was being sarcastic. Personally, I put away a chunk of my gross Uber/Lyft income every week, for future maintenance/repairs and towards the next vehicle. Until recently I was designating a certain amount for this stuff, but keeping it in the same account. I realized that having it in the same account takes more discipline not to spend it, so I started putting it in a separate account.


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## oldfart (Dec 22, 2017)

reg barclay said:


> I agree, I was being sarcastic. Personally, I put away a chunk of my gross Uber/Lyft income every week, for future maintenance/repairs and towards the next vehicle. Until recently I was designating a certain amount for this stuff, but keeping it in the same account. I realized that having it in the same account takes more discipline not to spend it, so I started putting it in a separate account.


The dicipline is the thing. I did well in the winter but not so well in the summer. Im fortunate however, I was able to start this Uber thing with a pretty good car and enough money in the bank to buy a new (used) car. It's hard to be disciplined and at least for me, harder to to be disciplined when you don't have to be


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## Italianrick (Oct 20, 2017)

FXService said:


> How many times have you taken Uber or Lyft as a passenger? I've done it many times. The majority of my drivers show up in newer model cars. Hell I was telling SibeRescueBrian that I got picked up in brand new Jaguar XF one time on X. One lyft driver I casually talked to had just bought a brand new 2017 Camry SE strictly for rideshare. he had for "about 3 months." odometer read 35k and some change. another guy had a 2016 RAV4 for a year, he also bought new for this gig. 75k mile. dash lit up like a christmas tree with CEL and other systems warning. and transmission shifted roughly. Most cars are lucky to last to past 250k miles. if you have people putting 80k a year on brand new vehicles and with banks becoming ever stricter and raising interest rates on financing people who have rideshare as their only source of income. The standard deduction goes out the window when it's time for a new car and you can't buy it outright. A subprime interest rate on a 18k loan or higher will easily out pace 3 years of the standard deduction. Sure people should only be driving beaters for X, XL, and even Select to be honest, but the reality is, they don't. And if I can help just one person sit down and figure out if this is for them or not and save them from massive debt down the road I'm ok, and I feel it's worth the effort. And if my super itemized expense how to can help some dude in a beater or looking for a beater maximize his earnings by realizing his expenses and minimizing, then again, it is worth it.
> 
> Also, I didn't even factor in food. that post is 100% just about the vehicle. Your dry cleaning for your suits, your lunch, etc, that's additional.


I really appreciate your efforts to help other drivers. I'm not a noob but I did learn from your post and will incorporate that information to my routine. Thanks


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## Cableguynoe (Feb 14, 2017)

FXService said:


> This is for you, newbies. Welcome to UP! I'm glad you have found us, and we have created a treasure trove of information for you! (Mods sorry in advance if this is posted in wrong forum) While you will find amazing strategies to increase your revenue, I'm here to remind you of that minus sign hanging out near your new and improved revenue stream. &%[email protected]!* that minus sign when it's getting too close to your dollars, right? Well, too bad. It isn't going anywhere. But you can find out just how big of a jerk King Minus is when it comes to your car. Your place of business. I've posted before how to calculate your expenses in this business. However, after going through my previous posts I can't find it. It's a combination of cost per mile (consumables) and cost per day (services, etc). I'll explain below:
> 
> *Consumables:*
> 
> ...


I'll start by saying that I didn't read your entire post. So I apologize if you touched on this, but I don't think you did.

I assume most drivers don't use their car only for UBER. They have lives, kids, jobs, etc. 
Most drivers already had their car prior to being drivers. 
So that car is already depreciating every day and would be even if we weren't ubering. 
Same with needing new tires, etc etc. 
We would need to do that anyway.

Sure, now it's depreciation faster and we need those new tires sooner. But we would have gotten them anyway.

What's the formula for that?


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## Christinebitg (Jun 29, 2018)

I take issue with the statement that anything over five years old doesn't have significant depreciation.

I bought my car a year ago, and It's a 2010. I paid $18,000 for it. The depreciation is slower than when it was new. But it's not neglible.

Christine


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## Bbonez (Aug 10, 2018)

emdeplam said:


> Great list even if you dont drive for Uber. Basically expenses of owning a car. It's more expensive than just the price.
> 
> Great to have a gig to offset those expenses...otherwise it a just owning a car.
> 
> If you work from home by this logic you should depreciate your home, add all appliances bought, heating cooling etc.. . Who can afford to work from home.


Are you serious? First a side gig is not off setting those expenses, it is creating them. The rideshare endorsement and rapid depreciation due to milage are not part of "just owing a car".

Your home analogy is so terrible I dont know where to start. My grandmother bought her home for under 20k 50 years ago now its worth about 1M she sells Avon out of a home office. By your logic she should add 20k a year to her income. Luckily for her the IRS is not that mentally disabled.

I normally find your uber propaganda funny, but this was low and attempting to take advantage of your lower IQ drivers and prospective drivers.


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## FXService (Oct 8, 2017)

Cableguynoe said:


> I'll start by saying that I didn't read your entire post. So I apologize if you touched on this, but I don't think you did.
> 
> I assume most drivers don't use their car only for UBER. They have lives, kids, jobs, etc.
> Most drivers already had their car prior to being drivers.
> ...





Cableguynoe said:


> I'll start by saying that I didn't read your entire post. So I apologize if you touched on this, but I don't think you did.
> 
> I assume most drivers don't use their car only for UBER. They have lives, kids, jobs, etc.
> Most drivers already had their car prior to being drivers.
> ...


I touched on this. This is where a detailed mileage log is important. Basically you log your Uber miles App on to app off. Say you drive 800 miles one week and your vehicle costs $0.20 /mi and $10 /day. 500 were spent hovering, the rest spent grocery shopping, kid ferrying, going to work, etc. So 800 x $0.20 = $160. To find out what part is the Rideshare expense turn the mileage into a percentage. So we 500/800=0.625. Now we take that (*N%*) and multiply it by the per mile (*M*) cost and the per day (*D*) cost and add it together.

So the formula for a week is:

*M x N% + 7D x N% = rideshare expense

160 x .625 + (7)10 x .625 = $143.75

*
If you have a rideshare insurance policy you don't use a percentage. Use the full price converted to a daily because it is 100% a business expense. Same thing for any services or fees strictly for rideshare. Even if you only rideshare 10% of the time, 100% of those costs are for rideshare. If I left anything out feel free to ask. I literally just woke up.



Christinebitg said:


> I take issue with the statement that anything over five years old doesn't have significant depreciation.
> 
> I bought my car a year ago, and It's a 2010. I paid $18,000 for it. The depreciation is slower than when it was new. But it's not neglible.
> 
> Christine


This is true. But as I pointed out in my post depreciation is a combination of age + mileage with age being the heavier weighted variable.

So one year ago you bought a 2010 car for 18,000. Just off the top of my head I'm going to assume you have a three row SUV/crossover made by an American company or Toyota. Or you have a luxury sedan most likely made by a European manufacturer. *I could be wrong.* Again, I just woke up and this is off the top of my head.

So at this point, in 2017 you bought a 2010 vehicle. 7 years old now 8. Probably had 90k to 120k miles. Your depreciation is significantly more dependent on the age of the vehicle barring any nasty grams on the Carfax. Here's why: Realistically there has been a redesign or refresh on the model lowering the value of yours regardless of miles, in theory it's already reached the point of it's first major service (think 90-120k mile service) which is usually the make or break point of most vehicles.

Also the make and model of your vehicle are going to affect this. Assume my guesses are correct and you bought the 3rd row SUV. Whether that vehicle has 150k miles or 200k the trade in and resale value is not that much different assuming good condition, maybe $1,000. Buyers and dealers know these vehicles operate well into or past the 300k mileage. However, on an E class or 5 series not so much. The difference in resale value of 150k miles and 200k is huge. So you need to research your vehicle and determine the best way for you to calculate your depreciation. But for most people with something like a mid size economy sedan or smaller, after 5 years it's negligible. It's not like the 2013 Camry is going to be making a comeback.

Like I also said. I could do an _*entire thread on depreciation*_.

Again sorry if I left anything out. I'm still waking up.

Uber on.


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## RoWode12 (May 12, 2018)

oldfart said:


> As long as you have a back up plan. just in case
> 
> I had a passenger the other day that told me about the accident a past Uber driver she had, had with her in the car. He needed a tow truck but didn't have the money or credit to pay for one. She said she paid
> 
> ...


The pax paid for the tow?! Ew.

That was kind of her. But how humiliating and unprofessional of that driver. Even if I was a horrible driver with terrible finances, I'd never let a pax know. (I'd never be in that situation, however.)


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## oldfart (Dec 22, 2017)

Bbonez said:


> Are you serious? First a side gig is not off setting those expenses, it is creating them. The rideshare endorsement and rapid depreciation due to milage are not part of "just owing a car".
> 
> Your home analogy is so terrible I dont know where to start. My grandmother bought her home for under 20k 50 years ago now its worth about 1M she sells Avon out of a home office. By your logic she should add 20k a year to her income. Luckily for her the IRS is not that mentally disabled.
> 
> I normally find your uber propaganda funny, but this was low and attempting to take advantage of your lower IQ drivers and prospective drivers.


But the irs is.

I worked from home for 7 years. I had an opportunity present itself and sold the business. And then because I sold my income, I needed Uber.

For those 7 years working from home I took the home office deduction. I took a percentage of all my home expenses incl depreciation and deducted that from my business income. That deduction increased my cash flow by the taxes I would have paid without the deductions

Uber can work the same way. That 54.5 cent deduction plus other business deductions do a pretty good job of hiding all my income. So I end up with positive cash flow while showing a loss to the irs. The only thing better would be owning a hedge fund or Trump Tower


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## Bbonez (Aug 10, 2018)

My understanding is if you take the depreciation that lowers your cost base. So if you have the business long enough to depreciate the building to $0 when you sell your home the entire sale price would be taxed as capital gains. But it is an entirely different animal then using a car for uber and taking the standard mileage deduction.


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## henrygates (Mar 29, 2018)

Good list. The only thing missing is repairs. It's hard to know when a repair will come up because they are so random and unexpected, usually.

Personally I keep track of all "repairs" separate from maintenance, and plug that into a line graph with a trend line that shows "estimated" potential repair costs based on historical repair expenses. Then set aside that amount every month for the inevitable repair.

One major repair on a vehicle can wipe out your Uber profits entirely.


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## 1.5xorbust (Nov 22, 2017)

henrygates said:


> Good list. The only thing missing is repairs. It's hard to know when a repair will come up because they are so random and unexpected, usually.
> 
> Personally I keep track of all "repairs" separate from maintenance, and plug that into a line graph with a trend line that shows "estimated" potential repair costs based on historical repair expenses. Then set aside that amount every month for the inevitable repair.
> 
> One major repair on a vehicle can wipe out your Uber profits entirely.


One minor repair or accident ($1000 deductible) can wipe out your Uber 'profits' entirely.


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## oldfart (Dec 22, 2017)

henrygates said:


> Good list. The only thing missing is repairs. It's hard to know when a repair will come up because they are so random and unexpected, usually.
> 
> Personally I keep track of all "repairs" separate from maintenance, and plug that into a line graph with a trend line that shows "estimated" potential repair costs based on historical repair expenses. Then set aside that amount every month for the inevitable repair.
> 
> One major repair on a vehicle can wipe out your Uber profits entirely.


One years profits, one month?, three years?

Like the bumper sticker says "sh** happens"
We need to be prepared for these things. We either need good credit or money in the bank


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## Cableguynoe (Feb 14, 2017)

oldfart said:


> One years profits, one month?, three years?
> 
> Like the bumper sticker says "sh** happens"
> We need to be prepared for these things. We either need good credit or money in the bank


Or a sister


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## oldfart (Dec 22, 2017)

Cableguynoe said:


> Or a sister


That works too


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## FrankLStanton (Oct 18, 2016)

Shouldn't financing costs be included? Whether the car is used or new, most people will use some type of financing to purchase. Those that use cash will be incurring opportunity cost, albeit, a minimum cost but a cost nevertheless.


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## hanging in there (Oct 1, 2014)

Cableguynoe said:


> I'll start by saying that I didn't read your entire post. So I apologize if you touched on this, but I don't think you did.
> 
> I assume most drivers don't use their car only for UBER. They have lives, kids, jobs, etc.
> Most drivers already had their car prior to being drivers.
> ...


The Edmunds expense tables assume $15k/mi/yr.

If you are putting 75k mi/yr then in a very simplistic way of looking at it, you could say that the Edmunds tables summarize what your car costs would be without doing U/L driving.

4x that number represents the U/L portion.
(Roughly, not exact. The fixed expenses would bring that number down a bit.

But, even insurance rates can go up sigificantly with more miles per year. You might be able to lie about it for awhile, but eventually it might catch up to you when the insurance company gets wise to it. At least that's how my personal insurance works.

The point is, you are wearing out your car much faster and having to spend a lot more to keep it on the road, versus personal driving only.


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## bsliv (Mar 1, 2016)

Edmunds tells us how much it costs to own and operate a car, driving it for 15k miles per year. But that's not what most here want to know. Most want to know how much they'll net driving for rideshare. The formula is simple, gross - costs = net. *If you don't know your costs, you don't know your net. *You might even be losing money. That is not a good way to run a business. Losing money in a business is not sustainable for long. The deeper your pockets the longer it can last but no one's pockets are infinitely deep.

The IRS using the same formula as Edmunds. If you input the average, new $32,000 sedan, it will be $0.545 per mile on Edmunds.

If one buys a car exclusively for rideshare, all costs associated with the car are business costs. That includes financing, taxes, fees, registration, insurance, etc. However, if one owns a car for personal use and would own the same car whether or not they drove for rideshare, financing, taxes, fees, registration and personal insurance are costs already incurred for personal use. They are costs of owning a car that doesn't include rideshare. They are personal costs. Deciding to drive for rideshare does not effect these costs.

Edmunds True Cost to Own is a great source of info, but not necessarily for depreciation. Kelley Blue Book is a better source for depreciation. I put my 3 year old car w/ 30k miles into it and it said its worth $11,400. If I had put 50,000 more miles on it due to rideshare, its value dropped to $8000. That's a loss of $3400 over 50,000 miles or $0.068 per mile.

Unless a car is most valuable as scrap, it depreciates. It may be an insignificant amount but it still depreciates. If a $1000 car is expected to go 10,000 miles before its maximum value is as scrap and the scrap value is $500, the $1000 car depreciated at the rate of $0.05 per mile.

As depreciation goes down, expected repairs go up. Generally, after a car is 5 years old, the expected repairs equals the depreciation. After 10 years, the expected repairs are much higher than depreciation. Repairs are typically usage dependent and not time dependent. Edmunds provides estimated repair costs for the first 5 years of a car. Graph the cost vs the mileage. Then extend a trendline to get an estimated repair cost for > a 5 year period. If one skimps on maintenance costs, expect higher than typical repair costs.

The average new $32,000 sedan costs $0.545 per mile to own and operate. If one bought a new $32,000 sedan to use exclusively for rideshare, it would cost $0.545 per mile to use for rideshare. But most rideshare drivers do not buy a new car. Most don't spend $32,000. I'd even guess that most don't buy a car exclusively for rideshare, they use what they already have. So the $0.545 number is irrelevant to determine cost.

Several studies indicate the average Uber car costs $0.32 per mile to operate. Let's say it costs me $0.32 to operate. If my area pays $0.60 per mile with a rider and half the miles are dead miles, I'm losing $0.04 per mile!

I think it was Car & Driver who estimated the cost to drive a certain Bugatti at $18.00 per mile.

Knowledge is power. Know your costs. Know your net.


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## Christinebitg (Jun 29, 2018)

FXService said:


> Like I also said. I could do an _*entire thread on depreciation*_.


Oh yeah, absolutely.

Some of your assumptions were pretty close, others were not.

It's a two row, five-seater Acura. For those that don't know, Acura is Honda's luxury brand, their answer to Toyota's Lexus. The model is an RDX, which I contend stands for Reduced size Crossover. 

It had under 60,000 miles when I got it, but I've passed that milestone now. I've done a couple of oil changes myself, but I used to pay to have them done before I started Ubering.

Correct me if I'm wrong, but for tax purposes, I think the IRS's figure of 54.5 cents per mile includes depreciation. I'm not saying that's an accurate _real_ amount of depreciation. That's a separate topic as well.

Christine


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## bsliv (Mar 1, 2016)

FXService said:


> _I could write_ _an entire thread dedicated to depreciation only._


I'd be up for it. In my day job as an appraiser, I determine physical, functional, and external depreciation. I've had classes that go for hours just on components of depreciation. I also create an Operating Income Statement that's 2 pages of calculations for a measly $100. The OIS boils down to *gross income - expenses = net income*. If you get a loan for the commercial use of property, you can bet a lender looks at a OIS. If one intends to run a business involving the commercial use of property, they had better have an accurate OIS.

I'd bet if more drivers did their math there would be fewer drivers.


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## Christinebitg (Jun 29, 2018)

bsliv said:


> I'd bet if more drivers did their math there would be fewer drivers.


There seems to be more than one type of driver.

1. This driver enjoys the physical act of driving and enjoys meeting a lot of new people.
2. This driver is an unskilled person who has difficulty holding a regular job.
3. This driver can't do simple arithmetic and thinks they're making tons of money.

I'm sure I'm leaving some out.

Christine


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## FXService (Oct 8, 2017)

Christinebitg said:


> Oh yeah, absolutely.
> 
> Some of your assumptions were pretty close, others were not.
> 
> ...


That's actually a good deal and I forgot about the Japanese luxury 5 seater SUVs. That's about right price point for RDXs, Lexus RX350s, and Infiniti FX35s especially considering over the last several years due to low interest rates and fuel prices we've been shifting to SUVs more. Like I said that was my 7am without coffee guess. That mileage was great though.

And awesome about doing your own oil changes! Air filters are even easier. And do your own spark plugs. The good thing about Acura and Lexus is that they still use Honda and Toyota engines that are just slightly tuned up so that parts like oil filters are cheaper compared to their European competitors. ($5-8 for RDX oil filter and only 5 quarts for oil change, whereas E350 is $12-16 per filter and 8 quarts full synthetic annnnd you have to remove the panels underneath to drain the oil pan).

As far as the IRS standard deduction in theory it does, but as a former Black/SUV driver itemized over standard is the better way to go. In my situation it was at least.


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## Christinebitg (Jun 29, 2018)

FXService said:


> That's actually a good deal and I forgot about the Japanese luxury 5 seater SUVs. That's about right price point for RDXs, Lexus RX350s, and Infiniti FX35s


Well, it was okay. But Acuras are not quite as pricey as the equivalent Lexus would be. The first one I bought was from a friend of a friend of a friend.

Yes, I can do the two air filters - cabin and engine air intake.

However, the spark plugs are another story entirely. I can't even FIND them! The internet tells me they're underneath the turbo intercooler, which sits on top of the engine. Maybe I'll try to figure that one out when it cools down in the garage. (It's still hitting 90 degrees here most days.)

C


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## BurgerTiime (Jun 22, 2015)

Lawmakers are seeking a change in rideshare vehicles to be disclosed as such which will depreciate your vehicle by anther 20% - 50%. When that happened say goodbye to ALL your minuscule profits!


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## FXService (Oct 8, 2017)

Christinebitg said:


> Well, it was okay. But Acuras are not quite as pricey as the equivalent Lexus would be. The first one I bought was from a friend of a friend of a friend.
> 
> Yes, I can do the two air filters - cabin and engine air intake.
> 
> ...


I just looked it up. You have to take the intercooler off to get to the spark plug. 

NA engines ftw!


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## SuzeCB (Oct 30, 2016)

1.5xorbust said:


> One minor repair or accident ($1000 deductible) can wipe out your Uber 'profits' entirely.


Rideshare Endorsement can lower your out of pocket deducible. Especially useful if driving Lyft with their $2500 deductible. Yikes!


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## oldfart (Dec 22, 2017)

Bbonez said:


> My understanding is if you take the depreciation that lowers your cost base. So if you have the business long enough to depreciate the building to $0 when you sell your home the entire sale price would be taxed as capital gains. But it is an entirely different animal then using a car for uber and taking the standard mileage deduction.


You are exactly right. It's called depreciation recapture. So if you depreciate the building to zero, all of the sale price is subject to capital gains tax.

There are two things to know regarding capital gains 1) you can postponebpaying the tax by rolling the sale proceeds into another investment property. That's called a 1035 exchange. And 2) capital gains tax is less than regular income tax

But as you say, none of that is important with depreciation a car. The care really does go to zero



FrankLStanton said:


> Shouldn't financing costs be included? Whether the car is used or new, most people will use some type of financing to purchase. Those that use cash will be incurring opportunity cost, albeit, a minimum cost but a cost nevertheless.


I'll assume the car is used exclusively for business. In that case the interest would be a deductible business expense, the principal payment is wrapped up in your deprecuatip deduction

I'm not an accountant so make sure you check what I say with your guy


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## 10G (Jul 21, 2015)

If after a year of doing uber/lyft and you are still at the point where you need to worry about car depreciation and car expense then you bigger issue. Mainly your finance. You have 4 weeks a month. You should make enough each week to cover your 4 cateorgy below. Also be frugal for the first year helps. You should have enought save up in year 2 that you can build upon and not worry about anything. 

Week 1 earning put toward saving
Week 2 earning for Rent
Week 3 eaning for Expense(gas/food)
Week 4 earning for Bills(car payment, insurance, phone)


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## oldfart (Dec 22, 2017)

BurgerTiime said:


> Lawmakers are seeking a change in rideshare vehicles to be disclosed as such which will depreciate your vehicle by anther 20% - 50%. When that happened say goodbye to ALL your minuscule profits!


Depreciation over the years will take the value of your car to zero if you hid it long enough

You can't go to less than zero so it's. If possible to increase depreciation

However if you are talking about just one year, sure it increases. Without ridesharedriving 10000 miles a year my car might go from $30000 to zero over 20 years. Using it for rideshare at 75000 miles a year it might go to zero in 3 years. So the total depreciation is the same, it's the rate of depreciation that changes



Christinebitg said:


> There seems to be more than one type of driver.
> 
> 1. This driver enjoys the physical act of driving and enjoys meeting a lot of new people.
> 2. This driver is an unskilled person who has difficulty holding a regular job.
> ...


I'm guessing most of us exhibit the characteristics of all three of your groups


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## oldfart (Dec 22, 2017)

RoWode12 said:


> The pax paid for the tow?! Ew.
> 
> That was kind of her. But how humiliating and unprofessional of that driver. Even if I was a horrible driver with terrible finances, I'd never let a pax know. (I'd never be in that situation, however.)


 Me neither but I suspect that there are more like the guy in my story than like us.. Maybe not more, but Im sure there are a lot of them


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## Christinebitg (Jun 29, 2018)

oldfart said:


> I'm guessing most of us exhibit the characteristics of all three of your groups


Not me! 

No. 1 - Yup, sure does. I even volunteer as a driver at a music festival.

No. 2 - Nah. I stayed gainfully employed for a lot of years. I just don't want to work full time any more. And couldn't talk my last employer into letting me work part time.

No. 3 - No way. I know this work doesn't pay well. However, on the other hand, I have two cars and don't need both. I'd rather drive one for Uber than selling it at a loss. I don't need to replace it later on. The other one got totalled in a flood, so I don't think I could get it approved.

C



FXService said:


> I just looked it up. You have to take the intercooler off to get to the spark


Yeah, that's my understanding too. Probably more work than I want to sign up for any time soon.

C


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## Taxi2Uber (Jul 21, 2017)

FXService said:


> OP


Depreciation: $0.113 [seems high, more like .07]

Gas: $0.058 (using $2.85/gal as national average) [closer to .07, wont get 48.5 mpg in real world of RS]

Oil changes: $0.004 (@ $40/10,000) [DIY $30]

Tire rotation: $0.004 [free, if Michelins bought at discount tire]

Alignment: $0.004 (assumed $70 for wheel alignment. Usually FWD cars in this business need them about every 15-25k, I estimated 20k)

Air Filters: $0.001 (combined cost of $25 for both engine and cabin at 20k miles. Please don't tell me you're paying someone to do this for you. If you own a screwdriver you can replace an air filter on ANY CAR)

Tires: $0.008 (*MICHELIN *DEFENDER T + H*195 /65 R15 *at $523 from Discount Tire and assuming 70k useful tread out of 80k manufacturer, these are also damn good tires and you can usually catch them on sale at Costco)
Spark plugs: $0.001 ($131/120k mi)

Coolant flush: $0.004 (at $188.50 every 50k)

*Total: $0.197/mile*

*Services:*

Insurance: $10 ($3650/yr for math simplicity)  [How much?!?]
Registration: $1 ($365/yr) [How much?!?]

Car Wash Pass: $0.99 ($30month x 12/365) [C'mon. Hose, bucket, soap, rags]

Market specific fees, licenses, etc: $x.xx

*Total: $11.99/day*


bsliv said:


> Several studies indicate the average Uber car costs $0.32 per mile to operate. Let's say it costs me $0.32 to operate. If my area pays $0.60 per mile with a rider and half the miles are dead miles, I'm losing $0.04 per mile!


You know it doesn't work that way. You're not losing .04/mile.
You are also paid by time. Plus cancellation fees.
You have to look at the total revenue/mile.
Hopefully it's >$1/mile driving X.


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## FXService (Oct 8, 2017)

Taxi2Uber said:


> Depreciation: $0.113 [seems high, more like .07]
> 
> Gas: $0.058 (using $2.85/gal as national average) [closer to .07, wont get 48.5 mpg in real world of RS]
> 
> ...





FXService said:


> ***I've never owned a Prius, this is purely hypothetical for educational purposes. I attempted to get as realistic as possible, but please do your own research when calculating these figures for yourself
> 
> ****These figures are not meant to be used as a factual example of real world earnings. Just merely a simulation to explain the math.


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## Taxi2Uber (Jul 21, 2017)

My bad. I missed that part.


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## FXService (Oct 8, 2017)

Taxi2Uber said:


> My bad. I missed that part.


Also, $0.99/day for a unlimited full service car washes on a full size SUV. Yeah **** the soap and bucket when my car gets cleaned inside and out every day.


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## dmoney155 (Jun 12, 2017)

oldfart said:


> ..... Whats important at least to me is the "replacement number"
> 
> And what's most important to me is that I have that money when the time comes. In other words have reserve account and add to it every month


I like the way you looking at it. Look at the future where/what you want to be/do next, not the past. Money on the car you own is already sunk.



Bbonez said:


> Are you serious? First a side gig is not off setting those expenses, it is creating them. The rideshare endorsement and rapid depreciation due to milage are not part of "just owing a car".
> 
> Your home analogy is so terrible I dont know where to start. My grandmother bought her home for under 20k 50 years ago now its worth about 1M she sells Avon out of a home office. By your logic she should add 20k a year to her income. Luckily for her the IRS is not that mentally disabled.
> 
> I normally find your uber propaganda funny, but this was low and attempting to take advantage of your lower IQ drivers and prospective drivers.


That's totally different. Cuz unlike cars, real estate appreciate with time.... unless you having a grow-op or running brothel


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## oldfart (Dec 22, 2017)

dmoney155 said:


> I like the way you looking at it. Look at the future where/what you want to be/do next, not the past. Money on the car you own is already sunk.


Thanks 
no one here seems to understand the concept of Sunk Costs or using a car that is already 100% depreciated

I'm my case I have (had) a car worth $20000 and I expect to drive it 75000 miles a year for 3 years and then replace it. so my depreciation "cost" is about 9 cents a mile. But I want replace it in 3 years with a $25000 car so my reserve fund ought to grow at the rate of 10 cents per mile. And in my dreams I want a $50000 used Lincoln Navigator if I'm to realize my dream I need to save over 20 cents a mile

My argument is that the the depreciation number isn't as important as the "savings" number


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## bsliv (Mar 1, 2016)

oldfart said:


> I'm my case I have (had) a car worth $20000 and I expect to drive it 75000 miles a year for 3 years and then replace it. so my depreciation "cost" is about 9 cents a mile. But I want replace it in 3 years with a $25000 car so my reserve fund ought to grow at the rate of 10 cents per mile. And in my dreams I want a $50000 used Lincoln Navigator if I'm to realize my dream I need to save over 20 cents a mile


You have a business goal and a business plan to reach the goal. But it doesn't answer the question of cost to drive.



oldfart said:


> My argument is that the the depreciation number isn't as important as the "savings" number


For long term thinking, I agree. But many drivers are short term. The first thing a new driver should do is to calculate if the gig is profitable. Then they should figure how much net profit they can make. Once the driver determines the net profit <or loss> they can develop a goal and formulate a plan to reach the goal.


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## oldfart (Dec 22, 2017)

bsliv said:


> You have a business goal and a business plan to reach the goal. But it doesn't answer the question of cost to drive.
> 
> For long term thinking, I agree. But many drivers are short term. The first thing a new driver should do is to calculate if the gig is profitable. Then they should figure how much net profit they can make. Once the driver determines the net profit <or loss> they can develop a goal and formulate a plan to reach the goal.


Yes I do have a business plan and as I've said before. There are two kinds of Uber drivers, those that treat this as a business and those that don't

The biggest criticism I've heard from Uber drivers is that to basically give up your car for a little money. And if you use your money for groceries it can be said you are eating your car

If you spend all the money that comes to you from your Uber effort that's certainly true. And although At the time I didn't care, since I was going to sell the car anyway. (I don't need two cars except for Uber and by the time my car is junk I'll be 75 and I don't want to drive much past that anyway) I didn't want to just eat the car.

So my plan is to put money in the savings account at the same rate the value of the car is depreciating. So that at any time the value of my business will be constant. in the beginning the car is worth $20000 and savings is zero but at the end, the value of the car is zero and the savings account is $20000 and at any point along the time line the value of the car plus savings will be $20000

Here's a graph showing what I'm doing.

Now profit is not a concern of mine. As long as I break even (start with $20000 finish with $20000) I'll be happy.

Earnings is another story. I want to make $3000 a month after expenses incl the money put to savings


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## El Jefe de Hialeah (Jun 11, 2018)

Dude, I just take the maximum, standard deduction


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## bsliv (Mar 1, 2016)

El Jefe de Hialeah said:


> Dude, I just take the maximum, standard deduction


Dude, this isn't about taxes.



oldfart said:


> So my plan is to put money in the savings account at the same rate the value of the car is depreciating.


That is wise. I propose it would be even wiser to put money in the account that matches the total cost to drive. If you drive 100 miles, put $35 dollars in the account instead of just the $10 depreciation. When oil change time comes around, the account will have that covered. When tire change time comes around, the account will have that covered. And, of course, when car change time comes around, the account will have that covered. If a repair situation arises before it was expected, it will only be partially covered. But if a repair is required after it was expected, it will be covered. For instance, if you expect the water pump to last 100,000 miles but it only goes 80,000 miles, it will only be 80% covered.

I understand its a lot easier said than done but I think a bean counter (accountant) would suggest it. It would leave a good paper trail for end of year analysis, too.

You'd pay gas out of the account, too. That may or may not be convenient. If you get a discount for cash instead of a debit card, I'd take the discount. If you do pay cash, next deposit don't include the gas cost.


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## Christinebitg (Jun 29, 2018)

bsliv said:


> That is wise. I propose it would be even wiser to put money in the account that matches the total cost to drive. If you drive 100 miles, put $35 dollars in the account instead of just the $10 depreciation. When oil change time comes around, the account will have that covered. When tire change time comes around, the account will have that covered. And, of course, when car change time comes around, the account will have that covered. If a repair situation arises before it was expected, it will only be partially covered. But if a repair is required after it was expected, it will be covered. For instance, if you expect the water pump to last 100,000 miles but it only goes 80,000 miles, it will only be 80% covered.
> 
> I understand its a lot easier said than done but I think a bean counter (accountant) would suggest it. It would leave a good paper trail for end of year analysis, too.


That's pretty much what I've done, although I don't buy gas through it. Just maintenance and replacement cost, on a cents-per-mile basis. As my cars have gotten nicer, I've raised the per mile amount I charge myself.

I don't use a separate bank account for it. I just set aside money in my budget for it every month, and track it like any other spending.

Another plus from it: it makes it easy to see when maintenance costs are getting high. That's because the amount in it slows down and then levels off when maintenance spending is up.

Christine


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## oldfart (Dec 22, 2017)

bsliv said:


> Dude, this isn't about taxes.
> 
> That is wise. I propose it would be even wiser to put money in the account that matches the total cost to drive. If you drive 100 miles, put $35 dollars in the account instead of just the $10 depreciation. When oil change time comes around, the account will have that covered. When tire change time comes around, the account will have that covered. And, of course, when car change time comes around, the account will have that covered. If a repair situation arises before it was expected, it will only be partially covered. But if a repair is required after it was expected, it will be covered. For instance, if you expect the water pump to last 100,000 miles but it only goes 80,000 miles, it will only be 80% covered.
> 
> ...


That makes makes sense.

I make a distinction between routine maintenance and reserves for replacement and unscheduled (surprise)repairs

So each month everything incl social security and retirement and Uber money goes into checking. I pay for everything (household bills and gas and oil and tires) on a credit card and then pay that off each month. Anything left over goes to savings

It's time (thanks for the reminder) to organize a LLC and give it its own bank accounts


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## wontgetfooledagain (Jul 3, 2018)

Crazy complicated and likely to net you less than the $.55 per mile that the IRS allows.

An easier way to track expenses in detail (if you care) is to get a credit card and *only use it for expenses.* You'll have a monthly and annual statement that tells you all you need to know.


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## oldfart (Dec 22, 2017)

wontgetfooledagain said:


> Crazy complicated and likely to net you less than the $.55 per mile that the IRS allows.
> 
> An easier way to track expenses in detail (if you care) is to get a credit card and *only use it for expenses.* You'll have a monthly and annual statement that tells you all you need to know.


Good idea when I do the LLC and it's own bank accounts I'll have a debit card just for business


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## FXService (Oct 8, 2017)

wontgetfooledagain said:


> Crazy complicated and likely to net you less than the $.55 per mile that the IRS allows.
> 
> An easier way to track expenses in detail (if you care) is to get a credit card and *only use it for expenses.* You'll have a monthly and annual statement that tells you all you need to know.


So let me get this straight, you who fail to understand this has nothing to do with taxes, suggest people don't take the time to fully understand their expenses so they can plan financially and just get a credit card because your statements can act as your expense report. What happens if you have to put a huge charge on it for a repair because you didn't budget and now you're stuck paying 10% or more APR....lol.


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## oldfart (Dec 22, 2017)

FXService said:


> So let me get this straight, you who fail to understand this has nothing to do with taxes, suggest people don't take the time to fully understand their expenses so they can plan financially and just get a credit card because your statements can act as your expense report. What happens if you have to put a huge charge on it for a repair because you didn't budget and now you're stuck paying 10% or more APR....lol.


You are not "stuck" with anything You do know that if you pay the balance before the due date there is no interest, don't you?

Budgeting and planning and tracking all your expenses is what we are talking about here. The credit card would be to help manage things, and with the right card get some cash back or maybe earn some airline miles for a vacation once in a while


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## FXService (Oct 8, 2017)

oldfart said:


> You are not "stuck" with anything You do know that if you pay the balance before the due date there is no interest, don't you?
> 
> Budgeting and planning and tracking all your expenses is what we are talking about here. The credit card would be to help manage things, and with the right card get some cash back or maybe earn some airline miles for a vacation once in a while


And what happens if you can't pay it back before the due date?
Not everyone is as fiscally disciplined as you or I.


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## dirtylee (Sep 2, 2015)

ez peasy lemon squeezy

Vehicle expenses > bank account


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## oldfart (Dec 22, 2017)

FXService said:


> And what happens if you can't pay it back before the due date?
> Not everyone is as fiscally disciplined as you or I.


what happens then, of course is they pay the interest,,, Thats the whole point of building a reserve account... hopefully the reserve account has some reserves in it before they need it

having said that, if you borrow the money just after the closing date on your card it will be nearly 30 days before you get your bill, and then, if paid by the due date which is usually about 30 days later, there is no interest... so if you time your purchase right you will have nearly 8 weeks to get it paid without interest

I understand that driving for Uber is often a desperation move and these desperate drivers use the instant pay feature to keep one step ahead of the wolves. I told the story in another post about a passenger who on a previous ride, paid her drivers tow truck bill... He had been in an accident with her in the car, and didnt have the cash or credit to pay it himself... This makes the point that folks that dont have a reserve account or good credit are out of business when there is even a slight bump in the road

Ive read that most drivers dont do this thing more more than a few months. They dropout because the can,,, they no longer need the money, or because they have to.. The car breaks down and they dont have the money to replace it

Ive said it here before, There are those that treat Uber as a business, and those that dont. This thread seems to be offering suggestion for those that want a business

Conventional advice for folks starting a business is to have enough money to run the business and pay yourself for at least 6 months It takes that long to get up and running to generate enough cash flow to pay yourself

Yes Im lucky, I owned my car and I had some money in the bank before I started this thing. I suggest everyone get in that position, its not a bad place to be,,, and it can be done by putting some aside each month, and if you need to use credit use it wisely


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## wontgetfooledagain (Jul 3, 2018)

FXService said:


> So let me get this straight, you who fail to understand this has nothing to do with taxes, suggest people don't take the time to fully understand their expenses so they can plan financially and just get a credit card because your statements can act as your expense report. What happens if you have to put a huge charge on it for a repair because you didn't budget and now you're stuck paying 10% or more APR....lol.


No one is going to go the trouble to use your formulas (or even understand them), especially the losers on this forum. At least the dedicated credit card is automatic and easy to track. If they are not responsible enough to pay it off, that's their problem.


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## bsliv (Mar 1, 2016)

wontgetfooledagain said:


> No one is going to go the trouble to use your formulas (or even understand them), especially the losers on this forum. At least the dedicated credit card is automatic and easy to track. If they are not responsible enough to pay it off, that's their problem.


No one? You should probably rephrase that. There are several posters who don't have a problem grasping the subject. I'm fairly sure there are several readers who haven't posted that have been informed.

Is gasoline the only expense to drive a car? I wish that were true.

How is one to know their net income without knowing their cost to produce their gross income? Its impossible. Are you going to take a loss per mile and make up for it in volume?

How would you answer, "How much do you make driving?" You can't answer without knowing your cost.

The OP supplied valuable information on the cost to drive. That info will be used by the brighter readers while the less bright can put their head in the sand and hope. But be warned, hope doesn't pay the bills.


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## FXService (Oct 8, 2017)

bsliv said:


> How would you answer, "How much do you make driving?" You can't answer without knowing your cost.


"I gross about $1300/wk but my take home is about $2.36"


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## neweagle (May 13, 2015)

FXService said:


> Also, a lot of people say insurance, registration, etc aren't legitimate to consider expenses since you must pay them anyway. That's *Bullshit*,


This isn't bullshit if you are actually "ridesharing".

I set my destination filter for my office, pick up/drop off pax on the way, then do the same on the way home. That's how the concept of "rideshare" is actually supposed to work: giving a ride to people who are going where you're going, and getting paid something vs. $0 to offset the cost of the drive. Every cent of fixed cost, plus all variable costs for the 20 miles I'd drive each way anyway, don't factor into my cost analysis because whether or not I have pax in the car, those expenses are happening anyway. But if I end up driving a total of 26 miles because of picking up a pax or two, then the extra 6 miles is the expense base for ridesharing, even if I get paid for 15 miles.

It's really not that much different than the rationale for doing carpool: drive a few extra miles to offset a bunch of the cost I would concur if I didn't have anyone else in the car chipping in for gas I'd be burning anyway.


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## emdeplam (Jan 13, 2017)

HAHA so many funny answers. Only number that matters is what you made versus what you would make sitting at home. You can claim everything is an Uber expense, but how does that help with a decision when you still have insurance payments, car payments etc when you dont drive. 

Hint- not a driving expense if you still pay it sitting on the couch

How about these driving savings:
I made 230$ today because I worked and didnt go to the mall 
I made $35 by not going to bar but driving and making money


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## bsliv (Mar 1, 2016)

neweagle said:


> This isn't bullshit if you are actually "ridesharing".
> 
> I set my destination filter for my office, pick up/drop off pax on the way, then do the same on the way home. That's how the concept of "rideshare" is actually supposed to work: giving a ride to people who are going where you're going, and getting paid something vs. $0 to offset the cost of the drive. Every cent of fixed cost, plus all variable costs for the 20 miles I'd drive each way anyway, don't factor into my cost analysis because whether or not I have pax in the car, those expenses are happening anyway. But if I end up driving a total of 26 miles because of picking up a pax or two, then the extra 6 miles is the expense base for ridesharing, even if I get paid for 15 miles.
> 
> It's really not that much different than the rationale for doing carpool: drive a few extra miles to offset a bunch of the cost I would concur if I didn't have anyone else in the car chipping in for gas I'd be burning anyway.


This is correct. But it doesn't invalidate the need to determine the cost to drive. It does show that the formula may need to be tuned to each driver's circumstances. In your example you're right, you only added 6 miles so you'd only calculate the cost due to rideshare on 6 miles. If you calculated your cost to drive at $0.40/mile and you get paid $3.00, you made $0.60 and you'd probably ask yourself if it was worth it. Since you know your cost, you know your net, and *you can make an informed decision.* But that's one end of the spectrum. The other end is someone who bought a car exclusively for rideshare. In that case all expenses (financing, all insurance, taxes, registration, etc.) related to the car are rideshare expenses.

If one has an expense (car payment, insurance, etc.) before starting rideshare it is not an expense for rideshare. Likewise, if one has an expense doing rideshare that they wouldn't have had by not doing rideshare, its an expense for rideshare. For example, if you add rideshare insurance that's obviously an expense for rideshare.



emdeplam said:


> Only number that matters is what you made versus what you would make sitting at home.


Without knowing your cost to drive you can't know what you would net driving. It would be more profitable to stay home and watch tv than to do UberX in a new Rolls Royce.



emdeplam said:


> Hint- not a driving expense if you still pay it sitting on the couch


Bingo!



emdeplam said:


> I made 230$ today because I worked and didnt go to the mall
> I made $35 by not going to bar but driving and making money


Ugh, women (joking, don't crucify me). Did you gross or did you net $230? Did you use your new Rolls?


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## neweagle (May 13, 2015)

bsliv said:


> If you calculated your cost to drive at $0.40/mile and you get paid $3.00, you made $0.60 and you'd probably ask yourself if it was worth it.


True, but the numbers are usually much more favorable when I get paid for 15 miles for 3 extra miles of driving, which is my current average each way. The larger point is correct though: whatever each driver's situation is, you have to truly understand your net.


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## AvengingxxAngel (Jan 5, 2017)

Get all your quartely receipts out, spent on gas, car insurance, car payments, all car maintenance costs, GST payments (Aus), car registration, water and mints, percentage put aside for tax, and any other expenses, add that all up then subtract it from your earnings. That's a clear and simple way to see how much your revenue is (if you're a noob, or just can't be bothered doing it all the long way).


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## Christinebitg (Jun 29, 2018)

FXService said:


> Not everyone is as fiscally disciplined as you or I.


I can't make decisions for anyone else. They'll have to do it for themselves.

Christine


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## Oscar Levant (Aug 15, 2014)

FXService said:


> How many times have you taken Uber or Lyft as a passenger? I've done it many times. The majority of my drivers show up in newer model cars. Hell I was telling SibeRescueBrian that I got picked up in brand new Jaguar XF one time on X. One lyft driver I casually talked to had just bought a brand new 2017 Camry SE strictly for rideshare. he had for "about 3 months." odometer read 35k and some change. another guy had a 2016 RAV4 for a year, he also bought new for this gig. 75k mile. dash lit up like a christmas tree with CEL and other systems warning. and transmission shifted roughly. Most cars are lucky to last to past 250k miles. if you have people putting 80k a year on brand new vehicles and with banks becoming ever stricter and raising interest rates on financing people who have rideshare as their only source of income. The standard deduction goes out the window when it's time for a new car and you can't buy it outright. A subprime interest rate on a 18k loan or higher will easily out pace 3 years of the standard deduction. Sure people should only be driving beaters for X, XL, and even Select to be honest, but the reality is, they don't. And if I can help just one person sit down and figure out if this is for them or not and save them from massive debt down the road I'm ok, and I feel it's worth the effort. And if my super itemized expense how to can help some dude in a beater or looking for a beater maximize his earnings by realizing his expenses and minimizing, then again, it is worth it.
> 
> Also, I didn't even factor in food. that post is 100% just about the vehicle. Your dry cleaning for your suits, your lunch, etc, that's additional.


You're revealing why Uber is a bad investment and why we are not making money, and, in fact, losing money ( at least the full timers are ).

Wonderful, but I thought most of us knew that? I know i did.


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## FXService (Oct 8, 2017)

Oscar Levant said:


> Wonderful, but I thought most of us knew that? I know i did.


New people sign up for Uber/Lyft everyday. And new people sign up for UP everyday. If this post helps those people out then I say it's a success.


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## macinmn (Jan 5, 2016)

how I do math now?


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