.My Lexus GS350 AWD was very special to me.
I bought it after getting out of my first real estate company. I launched that company in 2012, lived off $300 per month for 12 months after graduating with $100,000 of student loans.
In 2014, I had cracked the egg, and realized I wasn't happy in real estate. I sold off most of my equity and that was the one and only time I really splurged and bought an expensive car with cash. It was the cleanest one on the market.
In 2016, I listed it on Turo. It was scary.
I was more interested in the idea than motivated by the measly hundred bucks I might make each month. And for that reason, I declined reservations for months because letting a stranger rent and drive my baby for multiple days was too stressful to think about.
You can relate, can't you? Comment below if you're too scared to rent out your car. I'd love to know what cars other drivers own that are scared to rent them out.
The first reservation.
The first reservation was in early August, but they cancelled it a few days before. I got paid $20 for them cancelling--phew! But the first real reservation was in December. Someone took it for a day and I earned $28.50.
They returned it and everything was just fine.
Now usually I wouldn't argue or gain an interest in that number, but coming from a real estate background, I would rent each room in my investment properties for $900/mo. Renting the car out for $28.50/day is almost $900/mo. Plus, the car was only $15k, where for a $200k property I'd have 4 bedrooms to rent. I raised an eyebrow and wanted more!
Every $900/mo you can make increases your income by $10,000+ a year! Even if it just starts with a $28.50/day reservation on Turo. Aspiring entrepreneurs: If you do that 3 to 6 times and you can now quit your 9to5.
The second reservation and accident
Everything was going smoothly until Dec 21st. It was out on a reservation and that's when I got an automated email from Turo saying there was damage reported to my car.
Soooo what the heck happens next?! I try to contact them and the renter with no immediate luck. I find on their website that sometimes damage must be reported within 24 hours to qualify for insurance so I submit requests. It was super ambiguous and that was very stressful.
I finally get a call from someone on Christmas Eve, which was comforting, but it would be another few weeks before I learned that my car had been not just damaged, but full blown totalled and then another week before I got the insurance check.
The biggest thing that stressed me out that I was dying to know was:
1. Is this going to affect my insurance and am I covered 100%?
2. Is the amount that insurance offers me going to be fair?
Fast forward to the end of the process and here's how it concluded.
I had my car for sale for $14,000 OBO before it went out on this reservation and was not getting many hits. At the end of the day I got a check for $15,900 for it being a total loss. My car being totaled on Turo translated to $1900+ more in my pocket.
Moving forward, now without my daily driver.
Where do things stand today? I have cashed the insurance check and plan to buy a more humble daily driver for myself and invest the rest in inexpensive, reliable cars to list on Turo.
I would still recommend it's a better idea to buy a house and rent out the unused rooms in it to a new entrepreneur, since you're dealing with hundreds of thousands instead of several thousand (makes it easier to create a salary). But for those not ready to make that jump, this is the perfect part-time venture.
It's better than Uber or Lyft because you make money even while you're not spending your time behind the wheel. You need your time to work on your startup.
Anyway, I can't wait to purchase more cars for my Turo fleet for additional passive income. Even after my daily driver was totalled.
Want to know why I'm not crazy to stay on Turo? The dollars.
The $2400 Suzuki I bought brought in early December has made $546.26 after all Turo fees in the 47 days I've had it up. That's about $4200+ per year. However, I will admit I haven't had to invest in any maintenance on the car yet, and also didn't deduct the increase in my insurance policy (almost $400 every six months).
It's evident to me it's easy to make monthly from services like this but here's what I want you to think about if you're considering the shared economy...
Don't forget you're paying the costs over time of wear and tear, higher miles, and unforeseen costs and time.
I don't recommend buying a new car and renting it on Turo. Find something used and inexpensive so it pays itself off quickly. Think about how many reservations you'd need to pay off that $30,000 Subaru that on a good day would only rent for double my $2,400 Suzuki.
Anyway, here's some resources for you guys
If you're wondering if your car qualifies to rent out on Turo, here's their eligibility requirements here.
If you'd like to purchase a vehicle to rent on Turo, watch my video, How to buy a used car.
If you'd like to look at my vehicles, here's my Turo profile.
If you'd like to see my airbnb listings, here's Matt's Real Estate Listings.