7 Top Tips for Boosting Your Earnings as a Rideshare Driver

A whopping 45% of Americans are working a side hustle this year, according to statistics collected by Zippia. While this data point says a great deal about this moment in our economy, it also suggests that finding a side hustle is easier than ever.

One popular option is driving for a ride-hailing service, such as Uber or Lyft. If you decide to take on one of these gigs, you'll naturally be concerned about your earning potential. Good news! There are several ways you can increase your pay as a ride-hailing driver. Here are some to consider if you're hoping for a higher checking account balance.

1. Improve riders' experience to earn better tips (and higher ratings)

Uber and Lyft drivers keep 100% of all tips, so it's worth focusing on creating the best ride experience possible for your customers. Personally, I tip on every ride I take, and I will kick in more money for a friendly driver or one who has nice amenities available in their car.

Consider offering bottled water, candy, or the use of a phone charger (it's best to have charging cords for both iPhones and Android devices). You can also take music requests. And while some riders will prefer a quiet experience, if a passenger seems down to chat, you can take them up on it. Ask questions and share information about the area if your rider is visiting from out of town. Giving a better ride experience can lead to better tips, as well as a better rating for you as a driver -- meaning more rides in the future.

2. Switch to food delivery around meal times

If you're going to be in your car anyway, you can double-dip on your earnings opportunities by delivering food instead of people around meal times.

Uber in particular makes it easy for drivers to switch back and forth between offering Uber rides and delivering for Uber Eats, so this could be a good strategy if ride activity slows down around lunch or dinner time. And hey, you don't have to make conversation with the takeout order you're delivering!

3. Be available during busier times and in busier places

When a lot of people need rides, such as morning and afternoon rush hour, that's the best time to make yourself available to accept those passengers. The great thing about driving for a ride-hailing service is that you can set your own hours and fit the work alongside another job, but if you want to boost your earnings, focusing on being on the road at busier times can go a long way.

Similarly, keep abreast of happenings in your city to know where and when you should be available to give rides -- if there's a huge concert at your city's arena this weekend, be out and about before and after the show to get passengers to and from.

4. Take advantage of bonus opportunities

Uber and Lyft offer chances for drivers to earn more money in the form of bonuses and promotions.

For example, Uber drivers can earn more for completing a certain number of rides within a set period. Lyft drivers have access to "Bonus Zones," which are areas where the pay for rides is higher due to demand. And both operate using surge pricing, so at certain times of high demand, rides cost passengers more, which boosts your earnings.

5. Optimize your downtime

While it might be tempting to just keep driving around if you're not getting passengers, resist the urge.

Instead of putting more wear and tear on your car and using more gas, use a slow period to stop off for a bathroom break and a snack. And consider parking your car and waiting in an area adjacent to one where ride requests might come from, such as the airport.

6. Keep track of deductions

Finally, it's important to remember that driving for Uber or Lyft makes you a 1099 contractor, so you're responsible for paying quarterly estimated taxes -- they will not be taken out of your pay. And you're eligible for all kinds of deductions to lower your taxable income, such as for gas, car maintenance, cellphone service, and more.

It's a good idea to invest in solid tax software for your business, and perhaps also consult with a tax professional to ensure you're paying what you owe (and not a penny more).

7. Use the right small business credit card for gas and other expenses

Pay for the expenses you incur as a ride-hailing driver (gas, maintenance, and so on) with one of the best small business credit cards. This can help you earn cash back and other rewards on that spending. And yes, even if you drive for Uber for 10 hours a week, this counts as small business ownership to the point of allowing you to apply for one of these cards.

Driving for a ride-hailing service can be a good way to start a flexible side hustle, especially if you have a decent vehicle, like to drive, and enjoy making conversations with strangers. Keep these tips in mind to earn as much as you can.