Tag: gig economy

Side Job Accounting

Flaws in the MIT ride-share earning calculations aside, I don’t think ride-share or home-share involves a realistic accounting of expenses against income. I used to use my personal car for work quite regularly. The company reimbursed per mile at a fixed rate, and I started off thinking I scored. Paid like 20 bucks for gas and they cut me a cheque for 100 USD. Then I needed to replace my tires *way* before I expected. Turns out the reimbursement rate wasn’t a major boon. If you consider tires, oil changes, brake pads as part of your auto maintenance budget and don’t book some portion of those expenses against your Uber/Lyft income, then the gig looks artificially profitable.

At the time I looked, Lyft had a 2500 USD deductible on their comprehensive/collision insurance (and both Uber and Lyft only covered comp/collision when passengers were in the car). Drivers incur additional expense for supplemental / commercial insurance policies or live with those restrictions. But most people I know didn’t consider their insurance coverage – which means they incurred risk that would offset income. Same with house-rentals (AirBnB, HomeAway) – apart from people who rented properties as a commercial venture (i.e. people who were using the service as advertising for properties they rented anyway, not just renting out their house for a week or two when they were out of town), I don’t find many people who really understood what, say, AirBnB’s host protection insurance covered  / what their homeowners insurance covered / what was uncovered.