How to make your car pay for itself

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By Gerri Detweiler/Credit.com

Every week it seems we hear from people who are driving a car they can't afford and are trying to find a way out. It's no surprise: the average car payment now has reached $483 for a new car and $361 for a used car, according to Experian Automotive. Unfortunately, these readers are also upside down on their loans, which means that if they want to sell their vehicles, they'll have to write a hefty check to pay off the difference, and it's money they just don't have.

How about putting that car to work by bringing in extra income?

Click ahead for a look at three ways you might be able to do that.

​Drive it

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If you've got some spare time, you may be able to pick up some extra cash by giving someone else a ride. The two most well-known ridesharing options are Lyft and Uber. (Other smaller companies include Shuddle for families and kids, and SheTaxis for women.) Driver requirements vary by company, but it's safe to say you'll need a current driver's license, and a vehicle that meets minimum standards.

These companies typically provide insurance for rideshare trips, but you'll still need to maintain your own insurance for times when you are driving yourself. And you'll want to check with your insurance company before signing up to make sure they don't have a problem with your side venture. Harry Campbell, a.k.a. "The Rideshare Guy," warns that rideshare drivers may be dropped by their insurance companies.

How much can you make? You'll generally earn a significant portion of the revenue generated by the trip (which varies), and with Lyft, you earn tips. Lyft advertises that you can make up to $35 an hour, while Uber says an independent study has shown the average driver makes $19.04 an hour. But that's gross income, not net. Still, the big draw is the ability to work when you choose. "Many Uber and Lyft drivers are making $15 to $25 per hour, but they are able to do it around their other jobs, when they're bored or just when they have free time," says Campbell. "Many people don't realize just how flexible driving is, but you really can turn your app on and off whenever you feel like it."

​Rent it out

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Looking for passive income from your vehicle? Companies like RelayRides, Getaround and FlightCar allow you to turn it into a rental car

"We have created a marketplace so anyone with an idle car can make money from it," says Steve Webb, director of community for RelayRides. "You can put it on our marketplace and rent it to travelers who have been screened by us." The average rental period is three to five days, he says.

Safety-wise, all three companies provide insurance including primarily liability, collision and damage, comprehensive and theft. Beyond that there are some differences in additional coverage so you're wise to discuss your insurance needs with your agent to make sure you are fully covered and that they are OK with your car being used this way. These services also screen renters, and cars must meet minimum standards.

How much can you make? "The average active owner on RelayRides made over $500 last month," says Webb.

FlightCar, which operates out of 17 airports, offers the dual promise of saving money on airport parking (it's free) while earning income on a per mile basis if your car is rented out. (I typed my Kia Forte into their calculator and was quoted 10 cents per mile.) On the average five-day trip, the company says members save $100 in parking fees and make $30 in rental earnings. It also has a monthly rental program that guarantees $200 to $500 per month.

​Deliver packages

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Ever had to ship a large, heavy, bulky or fragile item? If so, you know how expensive it can be -- especially if you want it to get there quickly. Roadie is an app-based shipping platform that enables drivers to deliver packages and earn extra money. "By utilizing the extra space in your car, you can earn extra cash on trips you were already taking," says Marc Gorlin, founder and CEO of Roadie. (Sidecar Deliveries is another company that facilitates deliveries in eight U.S. markets.)

Drivers must have a valid driver's license and vehicle insurance. With Roadie, senders automatically get $500 of insurance and can purchase more, up to $2,500. Again, check with your insurance agent to determine if you need additional coverage. There is an "open box" policy that allows a driver to inspect what they will be transporting. Waffle House (with over 1,800 locations nationwide) is an official safe place for drivers and senders to meet, though they can meet at any location they agree upon.

How much can you make? "Drivers can get paid anywhere from $8 to over $300 per 'gig' with pricing determined by the size, urgency and distance of the trip," says Gorlin. He says one Roadie driver returned to his home in Atlanta from a vacation in New Hampshire, and by picking up four gigs along the way, including moving boxes and a bike, made over $500.

​Hidden costs

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Don't forget that when you earn income, Uncle Sam wants his share. With these gigs you'll generally be classified as an independent contractor, so you will need to set aside money for taxes. (Doing your taxes will also be a bit more complicated if you're used to just receiving income from a job.) You will also pay for your own fuel and maintenance.

And then there is the issue of putting more miles on your car, which further reduces its value. The biggest hidden cost is depreciation, says Campbell. "Many people don't realize that their car loses value for every mile they drive. These costs may not show up for months or even years though so they're easy to overlook," he warns.

But for those who can't afford their car payment and feel trapped, extra cash may help them pay off their car loan faster, and perhaps even avoid damage to their credit scores if they miss payments or have to hand the keys back to their lender.

Late payments on a car loan or other debt can cause your credit scores to plummet and result in higher interest rates going forward. To see how your auto loan may be affecting your credit, you can view your credit report for free once a year at AnnualCreditReport.com and check your credit scores for free each month on Credit.com.

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