When and when not to tip, advice from 'Mrs. Dow Jones'
Not sure how much to tip, if at all, when faced with those iPad payment screens? Finance Is Cool founder and CEO Haley Sacks has some advice.
Since the pandemic, tipping has proliferated—with 90% of customers tipping 15% or higher in 2022 in common settings. Also on the rise are those iPads that greet customers at restaurants, coffee shops, and even service establishments like beauty salons. They often direct the user's attention to various options for a tip – usually 10%, 15%, 20%, or even more.
However, some customers have begun to back away from giving larger tips, largely because they feel like they are being pressured for gratuities as the clerk is standing behind the screen—and sometimes for unsatisfactory or no real service at all.
Such a reaction is often known as "tipping fatigue," according to Sacks.
Sacks, who goes by "Mrs. Dow Jones" on TikTok, told Yahoo Finance Live (video above) that people "don't want to be seen as cheap," especially when using the iPad tipping screen at the front of a long line of customers. It's a stressful moment, she said – and one sign of the broader increase in tipping that began during the pandemic, when alternative ways to tip arose from the usual tip cup.
"[D]uring the pandemic, we all got more generous, because we were so grateful to the delivery drivers, to the restaurant workers," Sacks said. "It was such an unsure time, so we went above and beyond with our tips. And now, that is what is expected."
So, what are the current guidelines? It varies depending on the type of service.
Sacks said that, for coffee shops, customers should tip 20% if they purchase a "complicated beverage," and $1 or $2 if they are simply purchasing a cup of black coffee. Tipping for table service at restaurants has grown from an acceptable range of 15% to 20% to a window of 20% to 25%, she added.
While these services have experienced "tipflation," other sectors follow the same etiquette as before the pandemic, Sacks said. At salons, customers should still tip 20% to the main stylist and somewhere between $5 and $10 to any assistants, she said.
For delivery people, Sacks said she often tips whatever amount is greater: $5 or 20%, and increases that amount when the weather is poor outside. The average tip for movers is 20%, and if people can’t afford that, Sacks encouraged them to hand out food or drinks.
No matter the category of worker, customers will occasionally experience worse service than they expected. Sacks said that the best response in such a scenario is to evaluate whether mediocre service was caused by poor human behavior or an unintended mistake with the service.
"If they’re racist towards you, they’re offensive towards you, they completely ignore you – if it’s something like that – then absolutely don’t tip anything; that’s just poor human behavior," Sacks said. "But if your order gets messed up, or things like that, it’s not fair to take that out on a tip."
No matter the criteria, Sacks said "a tip is a standard."
"People think of it as such a decision, but if you’re going to eat out somewhere, you shouldn’t be eating out if you can’t afford to tip," she said.
But remember, diners: tipping with cash is always nice.
Jared Mitovich is a writer at Yahoo Finance. Follow him on Twitter @jmitovich
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