After seven years as a New York hotel concierge and 10 years running a concierge firm, Michael Fazio has his opinions on holiday tipping. But if you think he recommends playing Santa with every service employee who crosses your path, guess again.
As you come to grips with how much to tip people for the holidays, your own finances should be the main consideration. To keep control of spending and give appropriate gifts, you need to plan ahead.
Fazio suggests making a budget first. “Ask yourself if you have $500 or $5,000, and work backward from there,” he says. He suggests applying a rule of thumb based on tipping tiers: $20 gets a smile, $100 gets somebody’s attention, and $200 gets what he calls “insurance.”
That last category is for people who interact with your most valuable assets. “I love the guys in my garage, and they park my car upstairs in a very good spot. I don’t want anyone who has access to a $50,000 piece of my equipment to be angry at me,” Fazio says.
Guilt or gratitude? The one thing Fazio’s formula does not take into account is the quality of service. That is typical, says Holona Ochs, a political scientist at Lehigh University.
As coauthor of a book about gratuity giving, Ochs interviewed postal workers, bartenders, and strippers— more than 425 tip-earners in 50 occupations . “Tips are generally a weak signal of quality of service,” Ochs says. “People appear to tip rather for social and emotional reasons, because we care about how others perceive us.”
If what you tip is aligned with your emotions, you could end up spending out of control, especially on nannies, housekeepers, and dog walkers. Looking for a good amount? Tip them up to one week’s salary, Ochs says.
Don’t be ruled by guilt, adds Fazio. “We should all treat each other pretty nicely, so it’s great that the doorman is nice,” he says. “ Being nice is just one ingredient of many, and a tip is showing respect and appreciation financially for a job well done.”
That view resonates with Jason Haber, chief executive of Rubicon Property, a real estate firm in New York City. “Doormen, porters, and maintenance staff deserve a generous hand, but I think it’s important to ask friends and neighbors what they give, and then decide accordingly,” Haber says.
But insurance tipping comes into play: “There are many stories of how failure to tip resulted in a staff that became less attentive and helpful in the following year,” Haber says.
Don’t try to keep up. “It is more important to maintain your financial security than to out-tip the Joneses or blindly follow a neighbor or relative’s advice,” says Kevin Gallegos of the Freedom Financial Network. “Tips can add up, so if a cash tip is outside your budget, take the gift route or say thank you with a batch of cookies.”
Some tips work better if you pool resources. Colleen Rickenbacher, an etiquette expert and author of “Be On Your Best Business Behavior,” suggests that parents organize to give one nice gift to a teacher. Cold cash is out. “You don’t want to look like your children are bribing them,” Rickenbacher says. But gift cards can work.
How about cash for the trash man? Why not, Rickenbacher says: “If they work for a privately owned company, then tip $10 to $20 for each trash collector that may service you throughout the year.”
Technically, you’re not supposed to tip a Postal Service mail carrier, but no one’s likely to complain if you adhere to the government’s “20/50 rule,” which limits single gifts to $20 and total gifts in a year to $50.