Father with baby on the way wants to ditch a steady salary to finance a new car and drive Uber
The Ramsey Show hosts take a call
Side-hustle culture may seem enticing — you can be your own boss and set your own hours — but the reality can be quite different.
Bree, a stay-at-home mom from Philadelphia, has a toddler and a baby on the way. But her husband wants to quit his salaried job to drive for Uber full-time, thinking it’s an easier way to make more money.
Her husband is currently an assistant manager with a trucking company — a high-stress job that involves managing drivers and mechanics. Right now he makes US$1,800 a week. “His friend at work told him that on Uber they can make US$2,000 and more a week. So that’s why he’s thinking about it,” Bree told The Ramsey Show (1).
To do so, they’d need to replace their 20-year-old Lexus (which has engine problems), so her husband wants to finance a new car — something like a Toyota sedan — under his wife’s better credit to fund his new “business.”
“He’s going to drive that car into the ground and the depreciation is going to hit it so hard that you guys are going to be underwater on this car within the first week,” said co-host George Kamel. Here’s why the co-hosts warned Bree’s husband not to quit his day job.
As of 2023, nearly 6% of the Canadian population — that’s 2.4 million people — were engaged in gig work, according to Statistics Canada (2). But other estimates put this number much higher: A 2024 Securian Canada study conducted in collaboration with the Angus Reid Institute indicates the gig workforce could be as high as 22%, or 7.3 million Canadians (3).
And the platform economy is growing fast, projected to be worth US$2178.4 billion globally by 2033 (4).
In some cases, though, gig work isn’t a choice. According to the Securian study, “most Canadian gig work is done out of financial necessity, with more than half of gig workers (57%) relying on this type of work to supplement their primary income.”
For Canadians who can’t keep up with the rising cost of living (or who’ve been laid off), this type of work could offer a lifeline. For others, side-hustle culture has a certain appeal: You’re the boss and you determine how many hours you’ll work. And the more you’re on the clock, the more money you can make.
But the reality can be quite different. A Goldman Sachs analysis found that gig workers earn less per hour than they would in a traditional job — from 50% to 65% less (5). Not only are many gig workers earning less, they may not even be earning minimum wage.
For example, while Uber doesn’t specify how much its drivers get paid, a report by RideFairTO found that the median take-home pay for Toronto rideshare drivers ranged from C$6.37 to C$10.60 per hour — or less than C$6 after expenses like gas and maintenance (6). For comparison’s sake, Ontario’s minimum wage is C$17.60 per hour.
Despite this, some Canadians are walking away from stable jobs for the allure of flexible, high-paying gig economy work. And while it’s possible to make a good living — particularly if you’re a knowledge worker — many don’t anticipate the hidden costs tied to this type of hustle.
For Bree and her husband, there’s the hidden cost of car depreciation. Rideshare drivers can quickly put thousands of kilometres on their car, which can shorten both its lifespan and resale value. This also leads to faster wear and tear, requiring more maintenance and repairs.
Then there’s the cost of gas, cleaning and insurance (personal auto insurance doesn’t cover commercial use, so you’d need a more expensive policy or rideshare endorsement).
Self-employed workers are also responsible for both the employer and employee portions of Canada Pension Plan (CPP) contributions, as well as federal and provincial taxes (and possibly installment payments). You’ll also have to collect GST/HST on behalf of the government if your business earns more than C$30,000 in gross revenue over four consecutive calendar quarters (7).
Plus, there’s no paid sick leave, no paid vacation days and no RRSP matching. Inconsistent, unstable income can also lead to financial precarity.
Gig-work income can seem attractive, but after crunching the numbers, it often delivers far less once expenses and risks are factored in.
The Ramsey Show co-hosts strongly urge Bree and her husband not to go down this route — especially if they’re planning to add to their debt by buying a new car (they’re already US$40,000 in the hole).
“If he doesn’t enjoy his job currently, that’s fine. I’m all for him looking for different jobs that he enjoys more,” said co-host Jade Warshaw. But they shouldn’t go into debt for it, she said, and they should wait until the baby is born so they “have some solidity going through that.”
In Canada, the average annual cost of raising two children in a two-parent family is C$17,235 per year — or about C$293,000 from birth to age 17, according to StatCan (8).
So now is “definitely not the time” to put their income in flux, said Kamel.
If you’re considering full-time gig work, start by creating a budget (if you don’t already have one), establishing an emergency fund with at least three to six months of income and, ideally, testing it out in your spare time before quitting a stable job.
For example, you’ll want to stress-test your gig-work income before financing a car specifically for Uber or Lyft. But in Bree’s case, her husband can’t give Uber a trial run, since their 20-year-old Lexus has engine problems.
“You need a different car. But what you don’t need is another US$25,000 loan on top of your US$40,000 in debt,” said Kamel. Instead, he recommends they save up to buy a more reliable car and then clean up their US$40,000 debt.
“He’s not going to be switching jobs,” said Kamel. “He’s going to be working extra.”
The Ramsey Show (1); Statistics Canada (2, 8); Securian Canada (3); Business Research Insights (4); Goldman and Sachs (5); RideFair (6); Government of Canada (7)
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.
