A Guide to Tipping in a Recession

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It’s a tough economy out there, and with two sides to every tipping experience, it’s high time there’s a formula for figuring out the right tip — every time.

Bad economy or not, tipping has been a quandary for customers ever since the custom was introduced in 18th-century British pubs, where a good tip was though to get a heavier pouring hand for that gin and tonic and a heftier turkey leg for a hungry Yorkshireman.

While current numbers are hard to come by, the U.S. Labor Department did track total estimated tips in 2001, finding about $5 billion in tips earned overall in the U.S. — and that was when the U.S. economy was in much better shape. Other studies have claimed total U.S. tips were much higher — up to $26 billion.

Now that the economy has Americans tossing nickels around like manhole covers, what’s a good frame of reference for tipping in the “new normal,” where wallets are thinner and pocketbooks are lighter? MainStreet has some ideas:

By and large, tips for meals and drinks still range from 15% to 20% — less for poor service and more for good service. But that doesn’t cover pit stops for coffee or pizza delivery. For your local barista, make sure to pop in $1 when you order that mocha latte. For the pizza guy, or for the guy behind the deli counter who makes you a sandwich, 10% to 15% is appropriate. Note this: The more you pay, the more likely you’ll be remembered and treated favorably. But tip too little, and you can expect to wait.

If you are hurting for cash, but still want to take care of your cab driver or the doorman at your apartment building, give what you can — and mention that next time, when you’re flush, you’ll dig a little deeper. Service industry professionals are like anyone else — they’ll appreciate your honesty, along with your desire to give what you can.

How about some specifics? For those everyday tipping situations, try these tips:

Hairstylist: 20% — Some high-end hairstylists might complain, but most won’t at 20%.

Babysitters: -15% — They’re already getting all the food they can eat.

Pet care: Pets are family members, too, so pay the same as you would a babysitter or someone who cuts your child’s hair — 15%.

Hotel room service: Most high-end hotels already include a “built-in” gratuity of 15% to 20% for room service. If your hotel doesn’t, that same 15% to 20% range will suffice.

Bartender: For a round of drinks, $2 should work in most situations. For an entire tab, revert back to the 15% (for average service) to 20% (for good service).

Airport skycap: With more airlines cutting services, and handling more check-ins online, skycaps have it tough these days. When you do use a skycap service, aim for $1 to $2 per bag.

Furniture delivery: There’s no set rule for tipping delivery men, but a good rule of thumb is, the more they do for you, they more you tip. If your delivery guys not only carry your new bed upstairs, but put it together for you, and then take the empty box and trash back in the truck with them that’s worth $10 apiece.

Food delivery: About 15% — but never less than $2. After all, the driver’s coming a lot farther than any waiter to deliver your dinner. And if you don’t tip well, don’t expect your food to be at the front of the driver’s “to deliver” list next time.

There is no shortage of useful tips lists on the Web — the Money Crashers blog has a good one.

In the end, tipping is a personal choice. But remember this — no matter how personal it is to you, it’s likely twice as personal for the person on the other end of the tip.

—For the best rates on loans, bank accounts and credit cards, enter your ZIP code at BankingMyWay.com.

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