We’ve all heard the usual spiel on how to generate passive income: buying and renting out real estate, investing in bonds, holding dividend stocks, etc. These ideas are great and all, but by no means should investors limit themselves. Looking elsewhere for unconventional passive-income opportunities can be immensely rewarding, and today we’ll be going over one of those opportunities: Turo.
Renting your car out with Turo Turo is a peer-to-peer car-sharing marketplace, where, unlike a traditional car rental agency, you can rent your car out in lieu of a fleet. You can think of Turo as AirBnB, but for vehicles instead of housing. Currently, Turo operates in only four Canadian provinces: Ontario, Alberta, Nova Scotia, and British Columbia.
You can create a free account and list your car on the platform as a host within minutes. Being a host means you essentially operate your own mini car-rental business on the Turo Platform in an independent contractor type of arrangement. Once you have registered, simply set a price and availability and wait for the bookings to flow in. Once a renter makes a booking and you accept, you are responsible for coordinating with them for pickup and dropoff.
Do I need any qualifications? Turo has some basic requirements before a vehicle can be listed. These include a set of universal and geographic specific requirements. For Canada, vehicles must
- Be registered and located in the provinces of Alberta, British Columbia, Nova Scotia, Ontario, or Quebec;
- Be no more than 12 years old;
- Meet our insurance requirements;
- Have a fair market value of up to $75,000 in British Columbia;
- Have a fair market value of up to $105,000 in Alberta, Nova Scotia, Ontario, and Quebec;
- Have fewer than 200,000 kilometres;
- Have a clean title;
- Have never been declared a total loss; and
- Not display dealer plates.
How much could I earn? That’s the question everyone looking for passive income wants to know! As a host, you can get a rough estimate of your gross earnings using Turo’s “Carculator.” The below image shows the average earnings per month for a 2017 Honda Civic Canada wide to be $625 for 22 days booked per month ($28/day).
Keep in mind that because hosts on Turo work as independent contractors (much like Uber drivers), you shoulder the responsibility for paying vehicle maintenance costs, self-employed CPP deductions, and income taxes. These costs, along with Turo’s insurance premiums, should be factored into your net earnings estimates. Regardless, Turo can be an excellent way of turning your depreciating car into a source of consistent passive income.
The post 1 Unconventional Way to Generate Passive Income Without Stocks, Bonds, or Real Estate appeared first on The Motley Fool Canada.
The Motley Fool recommends Airbnb (NASDAQ:ABNB), Inc. Fool contributor Tony Dong has no position in the companies mentioned.
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