How Much Does an Owner-Operator Truck Driver Earn?

May 8, 2021

If you’re reading this, you might be a company driver who is considering getting your own truck. Likely one of the biggest factors in your decision will be how much an owner-operator earns per year after expenses. While they earn more than company drivers, they have more expenses too.

On average, owner-operators have the potential to earn higher income compared to company drivers. According to industry estimates, annual earnings for owner-operators can range from $50,000 to $150,000 or more, depending on factors such as experience, geographic location, industry segment, and business efficiency.

Here is a chart showing the average annual income of an owner operator truck driver vs. the cost of living index in each state.

StateAverage Annual Income (Approx.)Cost of Living Index
New Hampshire$160,000122.0
New Jersey$160,000128.8
New Mexico$140,00092.8
New York$160,000139.1
North Carolina$140,00093.8
North Dakota$150,00098.0
Rhode Island$160,000123.7
South Carolina$140,00096.7
South Dakota$150,00098.2
West Virginia$140,00084.9

Please remember that these numbers are estimates and can vary. It's essential to consider individual circumstances, market conditions, and other factors when evaluating potential income as an owner-operator truck driver in a specific state.

How Much Do Owner-Operators Earn Per Mile?

Earnings for an owner-operator will differ depending on fees charged by third-party trucking companies. The type of load they are moving also impacts how much they earn. The average pay per mile is about $1.75.

Most truck drivers drive between 2,000 to 3,000 miles each week.

After expenses, an owner-operator usually makes, on average, 70% of the gross revenue as take home income. This leaves the remaining 30% for expenses such as insurance, federal registrations, truck and trailer payments, fuel and on the road living expenses.

What Are The Factors That Impact an Owner-Operator's Earnings?

There are quite a few factors that will impact how much an owner-operator earns per mile. Here are some of them:

  • The company they work with. Owner-operators need to carefully choose which trucking company they want to work with. 30% is mostly a standard cut for these companies to take, but it may differ slightly.

  • The type of truck they drive. Dry vans are considered to be standard as they tend to have the most basic pay. Other kinds of trucks, like reefers, tankers, and flatbeds can bring in more for each mile. These trucks typically cost more, which explains their higher rates.

  • Their experience. The longer someone has been driving a truck, the more likely they are to get higher rates per mile. More years on the road (especially with a clean record) shows a trucking company that someone is reliable.

  • The distance per haul. Long-haul trips are more intensive than short-haul. This explains why long-haul drivers tend to be paid more per mile than short-haul drivers.

  • The season. Driving on icy or snowy roads during winter can be difficult. There are seasonal differences in how much is paid to owner-operators per mile. Winter is the season where the pay per mile peaks. Ice road truckers get paid a lot for similar reasons!

How Much Do Owner-Operators Make After Expenses?

Some sources estimate that an owner-operator spends 95% of their pay on expenses! Others put the amount around 70%. That leaves about 30% to 5% in the owner-operator’s pockets.

Regardless, owner-operators can influence how much they can take home. It all depends on how they manage the expenses that they have. 

Some of these expenses are fixed, which means the owner-operator will always have to pay for them. This includes when the driver isn’t even operating the truck at the time. Variable expenses are those that are only paid while on the road.

What Are The Expenses Of An Owner-Operator?

Here are some of the fixed expenses an owner-operator has to deal with:

  • Truck loan payments. Few owner-operators will have their truck fully paid for from the start. This means that there will be monthly payments to make.

  • Medical insurance. Unlike company drivers, owner-operators don’t get company benefits. That includes health insurance. This is an expense they will have to take care of from their own pockets.

    A truck driver with a partner or spouse with health insurance may be able to avoid this expense.
  • Other insurance premiums. This can be a large recurring expense for owner-operators as insurance can go over $10,000 each year.

    Owner-operators might not be paying for just one kind of insurance either. They may also need to pay bobtail insurance, cargo insurance, and physical damage insurance.

    These insurance costs can vary depending on many factors. This includes the owner-operator’s credit score, their driving record, and their insurance company.

    Owner-operators should be sure to shop around different insurance companies. This will help them get the best deal possible.
  • Cellphone contracts. A cellphone is indispensable for a truck driver, so those phone bills will always need to be paid.

  • Permits and licenses. Transporting certain materials may require paying for certain permits. In some states, owner-operators will have to pay regularly for a business license.

  • Taxes. An owner-operator is an independent contractor. This means that the trucking company won’t take taxes out of their pay. They will have to do that themselves.

    Owner-operators will need to pay self-employment taxes, which are about 15% of their income. Then there is both federal and state income tax to consider.

    There are a lot of tax deductions that an owner-operator applies for. They can have insurance costs, truck repairs, permits and licensing, and more deducted. This helps lower how much tax they’ll need to pay.

Here are some of the variable expenses:

  • Fuel. This is easily the biggest expense that owner-operators will face. Yearly expenses on diesel can exceed $50,000.

    There’s not too much that can be done to drop this cost. Owner-operators can look for a model of truck that is more fuel-efficient than others. While they may be more expensive, they will save the driver money in the long run.
  • Repairs and maintenance. The truck is the heart of the operation. If it breaks down, then everything comes to a halt. Expenses due to repairs can spring out of nowhere. Plus, they can be very costly!

    To avoid these, regular maintenance is key. Owner-operators often schedule routine maintenance after a set number of miles driven. This helps make it a predictable expense. It will also reduce the chance of a breakdown, though it won’t necessarily prevent one from happening.
  • Food. Most truck drivers grab something to eat when they reach a truck stop. Driving tens of thousands of miles means buying a lot of food. These costs can add up to a significant expense each month.

    Fortunately, this is one of the most easily reduced expenses. Many drivers use a power inverter in their truck, which allows them to use a microwave or hotplate. By planning ahead and preparing food at home, drivers simply warm up their food when they’re ready.

    Owner-operators often install a mini-fridge or cooler to store drinks and keep them cool.

How to Increase Your Earning Capabilities as an Owner Operator

To maximize profitability as an owner-operator truck driver, it's crucial to adopt effective strategies and optimize various aspects of your business. Here are some key steps you can take to increase your earnings:

  1. Efficient Route Planning: Plan your routes strategically to minimize deadhead miles (empty miles without a load). Utilize technology and route optimization tools to identify the most cost-effective paths, reducing fuel consumption and maximizing revenue-generating miles.
  2. Fuel Management: Fuel costs can significantly impact profitability. Implement fuel-saving techniques such as maintaining proper tire pressure, avoiding excessive idling, utilizing cruise control, and monitoring fuel consumption. Regularly compare fuel prices and consider fuel card programs or loyalty discounts offered by truck stops.
  3. Negotiating Freight Rates: Building strong relationships with shippers and brokers is crucial for securing profitable loads. Research prevailing market rates, understand the specific requirements of the loads, and negotiate competitive rates that align with your operational costs and desired profit margins.
  4. Diversify Your Client Base: Relying on a single client or industry segment can make your business vulnerable to market fluctuations. Expand your client base by targeting diverse industries and establishing connections with multiple shippers and brokers. This helps ensure a steady stream of work and minimizes the risk of being overly dependent on one source.
  5. Maintenance and Equipment Efficiency: Regularly maintain your truck and equipment to avoid unexpected breakdowns and costly repairs. Adhere to scheduled maintenance, conduct pre-trip inspections, and promptly address any mechanical issues. Well-maintained equipment improves fuel efficiency, reduces downtime, and enhances your reputation as a reliable owner-operator.
  6. Business Financial Management: Keep meticulous track of your income and expenses, maintaining accurate financial records. This helps you identify areas where costs can be reduced or efficiency can be improved. Consider working with an accountant or using specialized software to streamline financial management processes.
  7. Continuous Professional Development: Stay updated on industry trends, regulations, and technological advancements. Attend industry conferences, join professional organizations, and engage in networking opportunities with fellow truck drivers and industry experts. Being knowledgeable about the latest developments allows you to adapt quickly and make informed decisions.
  8. Personal Health and Well-being: As an owner-operator, your health and well-being directly impact your business. Prioritize adequate rest, exercise, and a balanced diet to maintain physical and mental wellness. Taking care of yourself reduces the risk of health-related issues, improving your productivity and overall profitability.

Remember, increasing profitability as an owner-operator requires a combination of smart business practices, efficient operations, and continuous improvement. Regularly evaluate your strategies, identify areas for enhancement, and adapt to changing market conditions. By focusing on these key factors, you can drive your profitability higher and build a successful owner-operator trucking business.

Owner-operators earn a higher gross salary than company drivers. However, they have a lot of expenses to handle as well.

Taking the right steps around these expenses can help keep these costs down. This keeps a driver’s expenses low, and their income high.

About the author

I’m Luis Uribe, author of this website. I am the owner and head publisher for Trucker Daily and a freight brokerage Total Connection Logistics. I have been in and around the trucking industry for over 15 years. It is my mission with Trucker daily to equip truck drivers, with the latest in industry updates, news, and helpful tips to help further your trucking career and life. Whether you are a truck driving veteran, or beginner, you will find information on this site to save you a lot of time in your driving journey.

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