Ladies and gentlemen, today I shall speak blasphemy and heresy! I shall question the wisdom of the divine! I shall challenge centuries of holy texts!
Today, I put forth the idea that Jason Fieber is wrong about car ownership!
Jason Fieber’s Stance On Car Ownership
Until recently, Jason’s stance on car ownership–or should I say against car ownership–was pretty much identical to mine. In fact, I would say that my position on not owning a car was even stronger than his.
After all, he used to own a car. He’s bought, sold, and owned more cars than I have (then again, I’ve owned a total of zero). He’s used them to get from Michigan to Florida and back again and then back back again. He knows cars too. He used to work in the auto industry.
I, on the other hand, despise driving. Despise. Like, literally, I hate every single aspect of operating a motor vehicle with the exception of the part where I don’t operate a motor vehicle. I hate the hustle, the lack of non-horn communications, the need to keep focused and alert, the risks, the rules, the liability, the need to deal with other human beings but now in two ton metal projectiles, literally everything. Also, I find cars boring. Literally baseball levels of boring.
But more importantly, we’ve both identified cars as expensive. The Bureau of Labor Statistics estimated that Americans spend an average of $9,500 on cars per person. I’m sorry; per “consumer unit”, in case you thought the US Government wasn’t soulless enough.
Just imagine what $9,500/year can buy you. And now just imagine what it could earn you if you took my advice and opened a cheap online brokerage account and invested that $9,500/year.
Cars are a depreciating asset. Hell, I’ve never been that generous to refer to them as such and have always called them a straight out liability. Both my and Jason’s opinions have always been that car ownership is the enemy of financial freedom.
And when it comes to matters of financial freedom, Jason’s opinion carries weight. They don’t call him Mr. Free At 33 for nothing. He’s 34 now, but he’s been retired for a couple years. And just by living frugally and investing his money into high quality dividend stocks. Check out my review of his book, The Dividend Mantra Way, in which he tells his story and goes over the hows and whys of financial freedom.
I’ve even mentioned a few times on this blog that I’ve modeled my own strategy for financial freedom after his.
But what happened that changed my mind about car ownership? What has me distancing myself from the anti-car mentality that Jason has preached for so long, especially when I despise cars and driving way more than he can ever claim? What did I find that has me looking at car ownership not as a detriment to financial freedom, but as an asset to it?
The answer: HYRECAR!
Who Is HyreCar?
HyreCar Inc. is a relatively new but popular entrant into the wonderful world of ride-sharing. Yes, ride-sharing. Think Uber and Lyft.
No, this is different than those companies. You don’t drive for HyreCar. Instead, it’s more like AirBnB for cars.
If you’re looking to drive for, say, Lyft, you can go on HyreCar’s website and rent a vehicle for a couple days, a week, or even a month. But that’s not passive income and thus not financial freedom, so we don’t care about that here. I’m more interested in the passive income opportunities. That’s where things get interesting.
The company–headed by CEO and former CFO Joseph Furnari and incorporated in 2014 according to the Delaware state website–gives car owners a chance to list their vehicles for rent.
Have a car sitting around your garage collecting dust? Do you work to make payments on a car that you only use to drive to work when there are perfectly good buses? Do you have buyer’s remorse on that luxury car that impresses no one and makes everybody just think that you’re compensating for something?
Well, HyreCar gives you a way to put that vehicle to use: earning passive income!
Vehicle owners can list their cars on the site and, once rented, sit back and collect the rent!
HyreCar states that owners make an average of $14,000/year by renting out their cars on the platform, but of course that will vary from car to car.
The site is geared towards renting the cars out to ride-sharing drivers and not some person who needs to get around for a few days and doesn’t want to deal with Enterprise Rent-A-Car, so you know that your “tenant” is just as focused on making money from your car as you are. The pay you rent and go and drive for
Uber and Lyft.
HyreCar also runs a nice little blog that provides tips for owners and renters alike. They answer questions many people have such as “What kind of cars does Uber use?” or “What does leasing mean?” Fun stuff.
So You Let Strangers Drive Away With Your Car? That Sounds Risky!
Sure, when you put it like that.
But any economic activity is the same. They’re all risky “when you put it like that”.
After all, do you invest in P2P lending? You’re just lending money to strangers over the Internet!
Do you invest in the stock market? The market can go up and down at any time! It could crash tomorrow!
Do you sometimes lease out your home with AirBnB? Or do you take the tried and true method of passive income that has existed for centuries, which is renting out physical properties to tenants? You’re letting strangers stay in your home!
Hell, do you work a day job? You can get fired at any time and for any reason, as you are hired on an “at will” basis! Do you work a day job and are also a human female? Well now I hope you’re risk tolerance is really high then, as sexual harassment in the workplace could be the norm for you as it was for Susan Fowler in her very strange year at Uber. Hey, it’s your fault for choosing to be a woman in a male-dominated society while in need of gainful of employment in order to pay your bills. You should’ve been born rich and male.
Investment have risk to them. All gainful activity has risk to it. But it’s about mitigating and preparing for risk. So how does HyreCar do that?
You can read their extensive Owner FAQ here, but the first thing to mention is that they screen their drivers. HyreCar runs their driver’s license number and screens their insurance to ensure a safe driving history.
Taken directly from their site, HyreCar’s requirements for those who wish to rent cars through their platforms (all information must be verifiable and verified) are as follows:
- Driver must hold a current, valid driver’s license.
- Driver must be at least 21 years of age.
- Driver driving history may not show:
a) A major violation in the last 3-5 years
b) More than 2 minor violations in the last 3 years, or
c) More than 1 minor violation in the last year
- Must have an in-state driver license, licensed for at least one year in state you want to rent car.
- Driver must possess a mobile phone in your own name that we can verify through text message.
- Driver must be a registered user of HyreCar.
They also require drivers to be insured and HyreCar even provides insurance policies to protect car owners. I had to do a little research, but I believe that the ride-sharing company (such as Lyft) is the master policy when the ride-sharing app is turned on and HyreCar’s provided/accepted policy on the driver is the master policy when the app is turned off.
Renters are responsible for all damages to the car as well as for paying for gas and tolls. HyreCar reimburses the car owner if the gas tank is returned empty.
HyreCar goes even further than all that. No key drops are allowed (in other words, owners and renters must meet in person to inspect the car and finalize the deal), the owner can cancel the agreement at any time, and if the car isn’t returned on time and HyreCar can’t debit a card for an extension, then the company will report the car stolen to the police.
So it seems that screwing around is not what HyreCar does. Otherwise their name would be, like, ScrewAroundCar or something.
Not that HyreCar doesn’t protect renters too. It’s the onus of the car owner to ensure that the car is in good working order and fully inspected before listing it. And it’s on the owner to take pictures of the car beforehand so he/she can prove that any damages that occur during the rental were the fault of the driver. HyreCar (and car renters who drive for Lyft and others) wants to make sure that the renters–and their passengers–are driving around in safe vehicles.
But if you look at the Driver FAQ and then compare it back to the Owner FAQ, you start to notice something. The former is a list of requirements while the latter is a list of rights. Not 100% as both parties both enjoy privileges and shoulder responsibilities, but it seems that HyreCar goes out of its way to back the car owners who are putting their property up for rent.
That seems to be a better deal than most landlords have, as residential real estate laws seem to exist to protect tenants from “greedy” and “evil” mustache-twirling landlords who maliciously demand that rent actually be paid on time.
I’ll be straight up with you all: I have zero experience in ride-sharing.
I’ve once ridden in an Uber cab because it was cold out. With a friend. He had the app and paid for the ride.
Frankly, I don’t know how these things usually work. I don’t know who should be responsible for X damages in Y situation. I don’t know if it’s normal for a company like HyreCar to provide insurance. I don’t know if the master policy should be provided by the owner, renter, HyreCar, or ride-sharing company. I don’t know why Uber won’t accept their insurance while Lyft does. Hell, I don’t know why the ride-sharer would have to accept HyreCar’s insurance (shouldn’t it be the other way around?).
I can’t even tell the difference between cars. They’re big black boxes on wheels, big white boxes on wheels, big gray boxes on wheels, just pretty much big colored boxes on wheels.
But I can recognize a great passive income opportunity. According to HyreCar, their owners have made up to $36,400/year, though that’s obviously not the average (which, as said before, was about $14,000).
In 2016, the average price of a new car was about $33,560. Of course, there are other costs to owning a car, even if you never drive it. And don’t forget that cars decrease in value quickly. Whereas home values generally rise as long as they are properly maintained, your car will sell at a loss.
Unless you live in a really small town, I find it hard to differ from Jason Fieber’s opinion on driving a car. Just take public transportation.
But companies like Uber and Lyft have given drivers the opportunity to turn those depreciating “assets” into something that can generate money.
But that’s active income and involves driving, which to me is like giving me the “opportunity” to sit on a cactus. Jason’s blogs have turned me onto the idea of passive income, and HyreCar gives car owners who don’t really need to drive their cars the opportunity to turn those vehicles in passive income streams.
As HyreCar says, “Isn’t it about time your car got a job?”
Yes, yes it is.
While I’m not sure how lucrative the idea of buying a car simply to rent it out on HyreCar would be (again, you will sell at a loss), I would turn to this company squeeze some final extra cash out of my car or to turn that useless car in the garage into something that can provide financial value rather than just selling it outright.
If you live in a city with good public transportation and primarily use your car to get to and from work, you’re more than leaving money on the table. You’re guaranteeing that you’re spending as much of your life as possible under the tyrannical rule of an employer, working harder and longer just to pay for that car.
Instead, use HyreCar to reverse the relationship. Take public transportation to work and list your car on HyreCar. The extra money you make from that can help you invest faster and send you further down the path to financial freedom.
Readers–What do YOU think!? Do you like the idea of listing your car for rent on HyreCar or any similar online rental marketplaces? Or is it just too risky? Has anybody here had any experiences with HyreCar, or with renting out their cars in general? Leave your thoughts in the comments below!
Disclaimer: This is a sponsored guest post. I have received compensation to write it. While I do my own research to ensure that the company is legitimate and would never promote a company that I either haven’t or wouldn’t use myself, that doesn’t mean you shouldn’t do the same. Please don’t simply take this non-driver’s word as Gospel; check out HyreCar and see for yourself if renting out your car is right for you.