Despite the tough economy many people still rely on proceeds from holiday tipping for a large portion of their seasonal income. But tipping is not reserved for only traditional service professions such as restaurant servers.  Around the holidays there are many other tipping opportunities for people who provide a service to you throughout the year.

Things to Consider Before Leaving Your Tip

Quality of the service provided.  Obviously, if you are unhappy with the service you are receiving you should not only not leave a generous tip, but should probably discuss the level of service with the provider.  When determining how much of a tip to leave let the service level guide you.  Does the individual go above and beyond, or just enough to get the job done?

Tip within your budget.  Sure, it would be nice to add to your paperboy’s tuition fund around the holidays, but a large tip might not be in your household’s budget.  Do not feel pressured to live up to a tipping standard (like the ones offered below) if your budget does not allow it.

Tip frequency throughout the year.  Do you typically tip for this service during each transaction?  When I venture out to get a haircut I typically leave a few dollars extra as a tip throughout the year, so at the end of the year I don’t leave a particularly large Christmas tip.  However, I do not tip our newspaper delivery person throughout the year, so I’ll include a little extra with the December bill as a thanks for keeping the paper out of the yard and on the pavement.

How Much Should You Tip This Holiday Season?

Like I mentioned above, a general rule of thumb should be to allow the level of service guide you.  Still, it is good to have a baseline, or starting point, when determining how much to tip.  Hopefully the following amounts will help get you started.

• Newspaper delivery person: $20, or less if you are like me and only receive the weekend editions.
• Baby sitter: Equivalent of one evening’s pay (in addition, a small gift from the child is a nice touch).
• Hairstylist:  If you tip throughout the year, double your normal tip amount.
• Mail carrier:  Gift up to $20, but not cash.  Personally, we like to bake a few goodies for both the mail carrier and the policeman that directs traffic after school.
• Housekeeper:  Consider a tip equal to the cost of one service.
• Personal trainer: If you see your trainer regularly (as in more than once a week), $30 to $40 ought to be sufficient.
• Gardener: Equivalent of one week’s pay.  This should be reserved for lawn care providers or gardeners that provide a regular, weekly service.  Give less for seasonal lawn care providers.
• Day care staff: A tip of $25 to $50 to each care provider plus a small gift from your child.

This is also a good time for a reminder that tips are appreciated by those in service industries all year.  One of my family members used to deliver pizza while in school and said you would be appalled by the amounts of some tips he received – in the $1 or $2 range, if any at all.  Think about it, food delivery drivers brave the elements and navigate traffic to deliver your meals.  Why do they receive less than the standard 10%-20% of the total bill that servers in restaurants receive?  Never quite figured that one out.

We are going through rough economic times, and tip income seems to be down for those in jobs that typically rely on tips for income.  People are eating out less, and canceling unnecessary services, minimizing the opportunities for those that work for tips to earn their money.  If you can afford to be a little extra generous, now is a great time heading into the holiday season.

A couple weekends ago we performed the annual rescue of our artificial Christmas tree.  As I hoisted the three sections of tree from our garage’s utility room I could not help but think of the money we had saved over buying a real tree.  And I wasn’t the only one!  My daughter recently wrote a persuasive piece for school arguing that artificial trees were more frugal in the long run.  I wonder where she gets it.

Artificial Christmas Trees Cost More Upfront

Reaching the decision to shop for an artificial Christmas tree was tough for me.  I am a traditional kind of guy, and every year growing up my mom and I would venture to a Christmas tree farm to scout out real trees.  I loved the smell of real Christmas trees, and never thought I would grow up wanting anything else.

When my wife and I got married we continued the tradition of buying a real tree for the first five years of our marriage.  However, as trees became more and more expensive, and we found ourselves spending more and more time doing the annual Christmas tree lights untangling, we decided it was time to consider an artificial tree.  After a little comparative shopping, we found our artificial Christmas tree at Michaels craft store.  It cost about $200 five years ago.  The tree was actually more expensive, but we managed to find a good deal at Michaels, and used one of their store coupons to receive further discounts.

At the time we were spending about $75 for real trees.  We liked the full, Fraser Fir variety for their fullness and scent, though they were admittedly more expensive than other types.  Our artificial Christmas tree matched this same style (minus the smell), and came pre-lit, which saves me those painful hours of untangling lights each year.  At $75 per year, we were on pace to spend $325 over the next five years with live trees, so from a purely financial perspective an artificial tree has saved us over $100.  But there are other benefits:

Pros of an Artificial Tree

• No needles to clean up.  Seriously, our vacuum used to smell like Christmas trees for weeks after sucking up all the needles dropped after taking the tree out.
• No lights to untangle.  No further comments required.
• Safer than real trees.  Artificial trees do not dry out, and do not require any water in their tree stand.
• Easy cleanup after Christmas.  Simply unplug the tree, take down ornaments and store for next season.
• No sap.  Anyone who has carried in a real tree can appreciate this one!

I’m interested to hear from you.  Which type of Christmas tree do you prefer, and why?

Photo courtesy of Vitamin C9000

I recently read an interesting little story in the L.A. Times,  Giving Thanks, about the real lessons learned from the first Thanksgiving. It is a story you probably missed in school. It is a lesson in capitalism, in self-sufficiency, and in personal freedom.

Here is a short excerpt from the article:

For the Pilgrims, life was a constant battle for survival. Later, Governor William Bradford made a decision. Instead of the colonists sharing their crops equally, he assigned a parcel of land to each family and told them they could keep whatever they produced for themselves.”

“Then what happened?” asked Sam.

“At last the Pilgrims began to prosper. Governor William Bradford wrote in his book ‘Of Plimoth Plantation,’ ‘This had very good success, for it made all hands industrious, so as much more corn was planted than otherwise would have been.’”

When crops were shared amongst all the colonists, some figured out that they could work a little less and still enjoy the same fruits. Those who worked hard began to resent those that worked less, and soon began to produce less themselves. However, when each family was responsible for feeding themselves, but were allowed to keep all that they produced, they began to prosper.

The “industrious” hands Bradford referred to are the same hands that built this country into what it is today. However, somewhere along the way we forgot the lessons from this Thanksgiving story.

We have slowly crept back towards a time of dependence on others to take care of us, rather than reliance on our own industriousness. To further stifle the entrepreneurial spirit, our government plans to levy higher taxes on those who are most industrious. And what good will that do?

Those who are most industrious provide jobs, and products, and services for others. To punish them is to ultimately punish ourselves. No, instead we should celebrate their success, and make it as easy as possible for more people to emulate them.

So on this day of Thanksgiving Day, I am thankful for our founders, who had the guts to set out on a journey for freedom, and ultimately fight for that freedom. I’m also thankful for the men and women who continue to fight to protect our freedoms today.

Our way of life will likely be tested in the coming months and years, thanks to the economic tailspin we’ve witnessed recently. But penalizing those who are most industrious is not the way to prosperity. Relying on someone else to provide for us is not the path to self-sufficiency. Remember these lessons on Thanksgiving Day, and beyond.

 
Photo courtesy of NCinDC

Today is Veterans Day, and while many of us enjoy a break in the action, it is a great time to recognize those who fought for the freedoms we enjoy today, and remember those who are not getting a break in the action because they continue to protect those freedoms. 

The History of Veterans Day

Veterans Day was originally established by proclaimation by president Woodrow Wilson in 1919 to mark “the heroism of those who died in the country’s service and with gratitude for the victory” of World War I.  The end of World War I was officially marked by the signing of the Treaty of Versailles on June 28, 1919.  However, fighting had stopped several months earlier when a cease-fighting agreement was made between the Allied forces and Germany to commence on “the eleventh hour of the eleventh day of the eleventh month.”  Some years later, in 1926, U.S. Congress officially recognized the end of World War I, and an Act in 1938 officially established November 11th as a legal holiday.

Thank a Veteran

Chances are you know someone who has served in the military.  If you don’t you can easily find a veteran to thank by attending Veterans Day parades, VA hospitals, etc.  I don’t have to go very far.  My grandfather joined the Marines at the end of World War II.  He went through flight training and was deployed to Korea for the Korean War.  He returned from Korea and continued to serve in the Marines before being called back to duty for Vietnam.  He served a twenty-nine year career in the Marine Corp, and was overseas for up to 18 months at a time on various tours of duty.  The sacrifices he made, and my mother and grandmother made while he served, are examples of what makes this country great.

We like to toss around the word “hero” a lot these days.  For me, the brave men and women who willingly put their life on the line for America’s cause are the real heroes. So take some time to thank a veteran today.  Also remember to think of those still serving our country today, at home and abroad, and the thousands who came before them.

For more information on the history of Veterans Day, or to learn about Veterans Day celebrations, visit The United States Department of Veterans Affairs.

Photo courtesy of krisandapril

We have recently attended a number of weddings, birthday parties and other celebrations.  With little time to shop for gifts we resorted to giving cash or gift cards in most cases, but from now on I think I’ll opt for simply giving cash.  Here are a few reasons why:

• Cash can be spent anywhere.  Unlike gift cards to specific stores, cash can be spent anywhere.  I always appreciate receiving a cash gift because I spend it in whatever manner I want.  Gift cards and gift certificates do not provide the same flexibility.

• Cash can be used for things other than spending.  Depending on what stage you are in of your financial turnaround, it might make sense to hang on to the cash gift, or use it to pay down debt.  In the past I have considered selling gift cards on eBay (for slightly less than face value) just to get the cash value to apply towards other goals. Newlyweds may be particularly appreciative of cash gifts to cover honeymoon expenses.  In fact, cash has become such a popular wedding option in Israel that couples are renting ATMs that allow wedding guests to transfer a sum of money in the newlywed’s bank account with the swipe of a credit or debit card.

• Gift cards may get lost. I am notoriously bad at keeping up with gift cards, and the remaining balances. If I toss the cash gift in a separate envelope I know exactly how much of the gift is left by simply counting the money.  That’s a lot easier than calling a 1-800 number and wading through a sea of voice prompts.

• Giving cash to kids helps reinforce spending lessons.  It is true what they say, spending with cash hurts.  When you hand over that $20 bill you got in your birthday card and get three pennies back it registers.  When you swipe the same amount on a gift card it just doesn’t create the same kind of mental lesson of separating you from your money.    What a better time to reinforce this lesson than when kids are young.

• Gift card balances are rarely fully redeemed.  Of course, this is primary reason retailers offer gift cards.  Unused portions of gift card sales eventually add to the company’s balance sheet.  Best Buy compiled its gift card redemption statistics and found that of its unused gift card balances, the average card had been held and not redeemed for about 2.2 years.  It’s probably safe to say the majority of those balanced will never be redeemed.

• Some gift cards and gift certificates expire with little warning.  I gave my wife a gift certificate for a day at the spa a couple Mother’s Day ago, along with the promise of keeping the kids out of her hair and letting her enjoy a day of pampering.  It was a while before we scheduled the spa day, and were disappointed to find out the gift certificate had expired the month before.  Fortunately, after talking with the spa owner she was still able to use it, but it made me recognize that if I had simply paid for the spa day on the day she visited we would have not had to worry about expiration dates.

Would you rather receive cash or a gift card?

Photo courtesy of ZaptheDingbat

No money post today as I plan on spending some quality time with family, and helping tend to one of our kids who came down with nasty round of flu over the weekend.  I’ll be back tomorrow kicking off a “mini-series” on money and relationships that will run for the remainder of the week.  Should be a lot of fun!

Hopefully many of you are able to enjoy the Labor Day holiday by spending some time with your families.  My daughter asked why Labor Day was created and I didn’t really have a good explanation, but thanks to a little surfing I came up with The History of Labor Day at the Department of Labor’s website.  If you are interested in learning more than you ever wanted to know abut Labor Day, check it out.

With less than 200 days (185, to be exact) until Christmas it is comforting to know that our budget debacles of previous years will not repeat themselves. For the last several years, the weeks leading up to Christmas were often spent hunting last-minute gifts while trying not to disrupt the delicate balance of our household budget. In the early years of our marriage we frequently turned to credit cards to foot holiday bills, but fortunately we recognized that was not a sustainable habit for financial success. For the last few years we have budgeted small amounts from the paychecks leading up to Christmas, but that means several trips to stores or rounds of online buying, and doesn’t exactly help spread Holiday cheer.

Christmas Savings Fund to the Rescue

A couple days after Christmas last year we decided to do something that up to that point we had never been able to do–save for an event and not touch the money for another purpose. We opened a savings account at our bank (I have since moved it to ING Direct–here is one of my ING Direct reviews), and scheduled transfers in the amount of $25 per paycheck, or $50 per month, to our “Christmas Savings” account. Next year, when we are ready to do our Christmas shopping, we will transfer the money to our primary checking account and take care of all our Christmas gift purchases at once.

What About Left-Overs?

If you are as frugal with your gift purchases as you are with your own purchases throughout the year, you will likely have some amount left over in your Christmas savings account. With these surplus funds you could get a head start on funding next year’s Christmas savings account, make an extra payment on debt, send a little to the kids’ college funds, or my personal favorite–give it away to someone who needs it more than you.

After reading the inspiring book about the life of Larry Stewart, Santa’s Secret, our family is beginning a tradition of giving away $100 to a complete stranger during the Christmas season. This year, we are planning to go out for breakfast on the morning of Christmas Eve and leave a $100 tip to our server. You never know what kind of impression such a random act of kindness may have on someone, and their family. Imagine a struggling single mom working at a Waffle House on Christmas Eve, wondering how she will fill the stockings for her little ones at home. That $100 could mean the difference in her kids continuing belief in the spirit of Christmas, or disappointment on Christmas morning. For us, that is what Christmas is all about!

When the temperatures outside is approaching 100 degrees it is hard to even think about Christmas some six months away. However, now is the perfect time to start planning for the expense! By spreading out the costs of presents and gift-giving throughout the year, you will feel less of a pinch around the holidays and be able to enjoy a debt-free, worry-free Christmas season.

photo by: krisdecurtis