Even though I have workaholic issues, I did manage to do a few fun things with my family over the holidays. We caught some movies, saw an Atlanta Hawks basketball game, went to the Peach Drop, and most certainly managed to eat out at some local restaurants. Every once in a while, I'm just befuddled on how we got to where we got to in America. There are large issues politically and financially that are facing us, but it just wouldn't be a smart money moves column if I didn't gripe just a little bit about the whole notion of 'gratuity added' on my bill at the restaurant.
First off, let's remind everyone just what the word 'tip' means as it pertains to leaving extra money at the end of a meal at a restaurant. Dictionary.com defines tip as a small present of money given directly to someone for performing a service or task. In most countries, tipping is not mandatory but is common that people will do this when they receive exceptional service. In the United States today, we've almost made tipping an expectation. It used to be in the 1980's that about 10% was the norm for a tip and today it is almost expected that it is in the 20% range. A 'tip' is truly supposed to be bigger when you received superior service and smaller when you receive inferior service. Most waiters and waitresses just expect the tip no matter what their level of service is at the meal.
The thing that really got under my skin over the holidays is that most restaurants will put something on the menu that says gratuity will be added for parties of more than a certain amount. This means parties of 8, 10, 12, or some larger amount of patrons so you don't have a big group of people who stiff the servers at the end of the evening. Somehow restaurants have now set that rate at 18% or 20%, and they are so kind to add an insulting line of 'additional tip' just in case we are too dumb to realize a tip was left already. Or maybe that we are too drunk and will just put a number because we feel guilty that the line is left blank. My family ate at a local restaurant in the Perimeter in Atlanta over the holidays that now put big parties at 5 or more. Yes, 5 or more. This essentially means that unless you are a party of 4 or less, you are guaranteed to pay 18% gratuity even if the service is horrible. This all flies in the face of tipping as the service we got that day was less than stellar, but I had no choice but to pay the bill.
Even takeout Chinese restaurants leave you a tip line when you pick up your order. If the guilt impulse hits you when you go for that pick up, you'll likely write $2 or $3 just because you don't want to feel like a cheapskate. It's just too much for me that everybody has a tip angle today. You might as well get a bell and a Salvation Army bucket.
I think no matter what the guidelines say about what's proper, you should leave the small present of money for your server based upon how good you think the service was at the meal. If it was great, you could leave more than 20% and if it was terrible than you need to leave a tip to let your server know that the experience was less than acceptable.
Ted Jenkin, CFP®, AAMS®, AWMA®, CRPC®, CMFC®, CRPS®
Co-CEO and Founder of oXYGen Financial, Inc
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