If you’re looking for a way to earn some extra income, driving for a rideshare app is one of the best and most popular options out there.
In today’s gig economy, more and more people are turning to rideshare driving as a side hustle, especially as ridesharing companies such as Uber and Lyft have become an increasingly common method of transportation.
Since the foundation of the company in 2012, Lyft has grown to become the second-most popular rideshare app, with over 12.5 million active riders as of 2020.
With a continued need for drivers, driving for Lyft can be an effective way to earn decent money with flexible hours.
However, if you’re planning on becoming a rideshare driver, there are a few things to know before getting started.
While pay with a side gig such as Lyft isn’t always the most consistent, there are several tools, resources, and driving tips you can use to maximize your profit and earn more money in less time.
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Lyft Driving Tips to Succeed as a Driver
Here are 16 Lyft driving tips that can help you make more money, boost your Lyft driver rating, and pay less in gig worker taxes.
Keep reading to learn more about how to maximize your profit while driving for less time.
1. Drive During Peak Hours
One of the best ways to maximize your earnings in less time is to drive during Lyft’s peak hours.
Because Lyft calculates price per ride based on real-time demands, you can take advantage of fares during peak busy hours to help maximize your profits in a short amount of time.
Surge pricing in rideshare apps occurs when there is a high demand for Lyft or Uber drivers without enough availability and drivers on the road.
Surge pricing is often seen during common daily events or high-traffic activities, including:
- Typical work commute times
- Late at night on weekends
- Sporting events
- Bad weather
One of the biggest draws of rideshare driving is the ability to pick your own hours.
By basing your schedule around surge pricing, you can make two to four times the amount for driving the same distance.
2. Prime Time
Lyft refers to this pricing during peak hours as “Prime Time Pricing”.
During periods of high demand for drivers, Lyft will add a percentage of the base rate to the total cost of the ride, making it easier for drivers to earn extra money by providing much-needed rides.
While working, Lyft drivers can use special Prime Time features in the app, such as the provided heat map.
This tool shows where in your city drivers are most needed so you can respond to locations with higher demand.
Be sure to keep an eye on different events around your city that may result in higher demand for rides.
Or, if you have availability throughout the day, you can drive during rush hour and enjoy Prime Time earnings while getting riders to where they need to be.
While surge and Prime Time Pricing isn’t always the most consistent way to boost your earnings, planning your driving schedule around Prime Times can be a fantastic way to improve your earnings during peak hours.
Related: How much do Lyft drivers make?
3. Stay in the City
The amount you earn as a Lyft driver is also heavily dependent on where you live and the areas in which you drive.
For rideshare drivers, cities are the place to be if you’re looking to maximize your profit.
Large cities offer more potential passengers and high-demand events, creating a higher need for rides and a higher average income.
In Bay Area, California, for example, gig workers near the most populated areas earn an average income of $23.28 per hour, with other large cities such as Seattle, San Jose, New York City, and Boston following closely behind.
Even if you don’t live in one of these top cities for Lyft drivers, it’s possible to increase your earnings.
By staying in the more populated parts of the city and providing rides near major hot spots, tourist destinations, or large local events, you can find a higher demand and maximize your profits per hour.
3. Use the Gridwise App
While driving for Lyft can be a fantastic way to earn money in the current gig economy, there are a lot of daily stressors that can make it difficult for drivers.
These include traffic, long lines, and wait times that prevent drivers from getting on the road and picking up more passengers.
The Gridwise app had some of these challenges in mind when designed.
The app meant to improve the rideshare driving experience, maximize profit, and track key information and statistics to help create an optimized driving schedule.
Here are just some of what you can do with the Gridwise App:
- View peak times to drive in different areas throughout your city
- Access the busiest days for rideshare drivers to help plan your week
- Track your mileage, earnings, business expenses, and more
- View real-time flight data and airport alerts to avoid long lines and airport wait times
- Easily switch between delivery and rideshare apps
4. Avoid Traffic
Because Lyft driver wages take into account time, distance, and trips, you’ll earn less money sitting in traffic and long lines.
And not only can you pick up fewer passengers when you’re stuck in traffic, but you’ll waste gas and lose out on more miles.
The Lyft app does have a built-in navigation system for drivers.
However, there are other ways to avoid traffic and increase your average pay.
Becoming familiar with busy, high-traffic roads and alternate routes can prevent you from wasting time while driving and ensure you get passengers to where they need to go as fast as possible.
While Lyft uses Google Maps for navigation, you may want to consider using Waze instead.
Waze takes into account traffic patterns and adjusts routes accordingly to help you avoid traffic more than other similar navigation apps.
If you live in a busy area prone to heavy traffic, finding the right navigation tool for you is a great way to earn more in less time.
Here are some of the best tips for becoming a top-rated rideshare driver with the Lyft app.
1. Keep Your Car Clean
The best way to achieve a high rating on Lyft is to provide an exceptional experience for riders.
One of the most simple ways to do this is by keeping your car clean.
Just providing a clean, well-maintained space for customers can earn you top ratings and higher tips per ride.
Top-rated ride-share drivers can often enjoy better access to riders in high-traffic areas, bonuses, and more, leading to greater success as a driver, higher average earnings, and improved tipping from satisfied passengers.
2. Be Safe
Along with keeping your car clean, driving safely and staying up to date with your car’s maintenance is another crucial aspect in earning high Lyft driver ratings and better tips.
Safety is always a priority when using a rideshare service, whether you’re a driver or a passenger.
Getting riders where they need to go safely and efficiently is one of the most simple ways to ensure a positive experience and maximize profit and benefits.
Keeping your car in good, working condition will also help ensure the safety of every rideshare app user.
Not only does this earn you more tips and 5-star ratings, but it will prevent any costly maintenance or damage to your car that will prevent you from working.
Additionally, buying a top-rated phone mount will help keep your eyes on the road and away from distraction.
Related: Is Lyft safe?
3. Understand Insurance
Most personal auto insurance policies don’t extend their coverage to businesses or side hustles such as Lyft driving, meaning you’ll need to purchase a separate rideshare insurance policy.
Lyft partners with several insurance agencies to provide complete coverage in case of an accident, damage, or injury while driving for their rideshare app.
Understanding how to determine your insurance coverage, what your options are, and what to do in case of an accident is a necessary step in keeping you and your passengers protected.
Be sure to check out Lyft’s complete insurance guide, resources, and FAQs about their policies before getting started.
4. Lyft Amenities — Phone Charger, Waters, Mints
Another way to provide exceptional customer service and gain 5-star ratings is by providing extra amenities and resources to passengers.
These extra amenities can include:
- Phone charger
- Water and other drinks
- Candy or snacks
Going the extra mile for your passengers and providing them with anything they might need during a ride is a great method to ensure positive ratings or reviews and higher earnings through tips.
Lyft Driving Tips to Pay Less Gig Work Taxes
While rideshare apps are a simple way to make some extra money, working as an independent contractor can feel overwhelming and complicated when tax season rolls around.
Here are some ways you can maximize your earnings and pay less in gig work taxes every year.
1. Keep Good Records
Your Lyft 1099 will show your gross ride receipts, which include deductible expenses throughout the year.
It’s important to keep good records of these expenses so you can accurately deduct them from your income and don’t pay taxes on necessary work costs.
Rideshare apps such as Gridwise are a useful tool when it comes to record-keeping.
This app tracks your earnings, mileage, expenses, and even generates a tax report for you.
With the premium option, you can also export CSVs for easy bookkeeping.
2. Claim Gig Worker Deductions
As a rideshare driver, you’re eligible for several deductions that can lower the amount you have to pay in taxes.
Your vehicle and phone, for example, are both crucial elements of your gig, allowing you to write off a variety of expenses, such as:
- Mileage and gas
- Car maintenance
- Fees and tolls
- Car amenities
- A business cell phone
- Third-party fees
Using one of the best mileage tracking apps can drastically reduce the need to track miles manually and help earn you the largest deductions possible for mileage.
3. Reporting Self-Employed Lyft Income
If you make over $400 driving for Lyft, you’ll have to pay a self-employment tax to cover Medicare and Social Security taxes.
When reporting self-employed Lyft income, you may need to make estimated quarterly tax payments.
Staying up to date on reporting your self-employed income can help you prevent paying any additional fees and ensure you can keep as much money in your pocket as possible.
BONUS: Other Useful Secrets to Boost Lyft Driver Income
There are a couple of other tricks and resources to keep in mind to help boost your overall income.
When planning your Lyft trips, location makes a significant difference in boosting your income.
You can use the Lyft driver app heat map and additional prime time resources to know where in your area has the most demand.
By using your resources to know where you’re most needed, you can be where passengers are going to need a Lyft driver and take advantage of the supply and demand in high-traffic areas.
2 Maximizing Bonuses
There are several bonuses available to Lyft drivers that allow them to earn more during busier times.
Be sure to keep an eye out throughout the week for scheduled or real-time bonuses.
Here are some of the bonus opportunities you can find with the app:
- Personal Power Zone bonuses during busy times or scheduled large events
- Back-to-back ride streaks
- Ride Challenges
- Earning guarantees
3. Know When and How to Drive
Having a driving strategy can help optimize how much you earn by providing more opportunities during Prime Time Pricing.
Stay up to date on major events in your area, the busiest times of the day, and daily hot spot alerts to help you know when you should be driving for maximum benefits.
4. Sign up for a Food Delivery Company
Many ride-hailing app drivers double up with a second side gig to earn some additional cash during their time off.
If you’re looking to maximize your profits even more, food delivery companies allow you to balance Lyft’s flexible hours with a second side hustle gig for even more money in your pocket.
To determine which is best for you, check out our guide: The Best Food Delivery Services to Work For.
Lyft is a great option if you’re looking to earn a side income as a rideshare driver.
However, if you’re looking for a way to truly optimize your time on the road, there are plenty of tips to achieve success as a driver.
Be sure to follow these tips for a guaranteed way to maximize your earnings and get the most out of your time and miles with Lyft.
These resources can make using Lyft the best experience possible for both you and your passenger, ensuring plenty of high ratings, more bonuses, and more overall profit.