Guide to Holiday Tipping and Budgeting

The holiday season is almost upon us, and you know what that means – it’s time to start planning parties and buying gifts for all the people you love. Unfortunately, it’s also time to start plotting out the practical aspects of the holidays, including how much money you should be spending.

Don’t allocate all of your gift-giving funds to your adorable nieces, nephews, or grandkids just yet. When planning our holiday gift-giving budgets, it’s important to remember the many people who have provided us with services throughout the year: the hairdressers who make us look so lovely, the caregivers who watch our children, and the workers who help make our lives easier.

Thanking these workers with a monetary gift has become a tradition of sorts during the holiday season, and it can also serve as an incentive to ensure you keep receiving excellent service throughout the year.

But, how much should you tip?

The following holiday tipping guide can give you a general idea of how much to tip each person whose work adds value to your life. (Note: If this list seems daunting, don’t worry — these are just general recommendations, and not everyone may be expecting a tip from you. Plus there are other ways to show your appreciation — we’ll talk more about that below.)

Live-in Nanny or In-Home Daycare Provider: These professionals are in charge of our most precious assets and deserve a reward for all they do. Emily Post suggests tipping one week’s pay and a small gift.

Regular Babysitter: A babysitter you use infrequently may not require a tip at all, but a babysitter who watches your children on a regular basis probably deserves recognition. Plan on tipping one night’s pay and a small gift from the children.

Daycare Workers: Since daycare providers who work in an institutional setting work for someone else, they shouldn’t be tipped the same way. Expect to give each daycare worker $25-$70 plus a small gift. If your children attend a daycare with many employees, plan to give on the low end in order to keep your gift within reason.

Live-In Help: Most of us can’t afford live-in help, but those of us who can should plan to tip them generously over the holidays. According to Emily Post, live-in workers such as nannies, housekeepers, and personal chefs should be given an amount of money equal to one week or one month’s pay and a personal gift.

Housekeeper: A housekeeper who cleans your house weekly or bi-weekly should expect a tip from you. Plan to give one week’s pay and/or a small gift.

Hairstylist/Barber: A hairstylist or barber you use regularly should be tipped up to the cost of the average service they provide.

Massage Therapist: A massage therapist used frequently should be tipped in an amount that is equal to your regular service.

Manicurist: Expect to tip a manicurist you see regularly an amount equal to what you typically spend on services with that person.

Landscaper or Gardener: Emily Post suggests tipping people who work in your yard with a cash gift worth $20-$50.

Mail Carrier: According to the experts at USA Today, federal regulations bar mail carriers from receiving cash gifts. Instead, give them a thoughtful gift worth around $20.

FedEx or UPS Driver: If you receive lots of packages, especially as you ramp up your gift purchases on, you may feel as if you know your UPS or FedEx driver personally. If that’s the case, plan on giving whatever you feel is appropriate — usually around $20.

School Bus Driver: Driving a bus full of children is a harrowing prospect for many people, yet school bus drivers do it daily. Experts at USA Today suggest tipping school bus drivers in the form of a gift card or gift worth about $10-$20.

Doorman: Expect to tip doormen at least $15, plus a small gift. If you live in a building with multiple doormen that you see every day, expect to tip each of them.

Garbage Collector: You may not interact with garbage collectors on a regular basis, but that doesn’t mean their work isn’t important! Expect to tip garbage men or women $10-$30 each if permitted by your town or city government.

Teachers: Your child’s teacher deserves to be recognized for his or her hard work throughout the year. However, you should plan on giving your child’s teacher a thoughtful gift instead of monetary compensation.

Home Health Employees- Home health workers who take care of your loved ones provide one of the most important services out there. If the company they work for permits it, consider tipping anyone who helps care for your loved one with $10-$30 or a thoughtful gift.

Nursing Home Employees: Nursing home employees who care for aging parents and relatives often have thankless jobs. The holidays present an opportunity for us to change that. Emily Post suggests tipping nursing home employees with food or other perks that can be shared in a group setting.

What About Everyone Else?

If you have others workers you’d like to thank this holiday season, don’t leave them out simply because you cannot find a holiday tipping guide that offers a suggestion. The fact is, many of us have unique situations in our lives which require extra help, and people who provide those extra services can be worth their weight in gold.

Some examples can include a child’s tutor or piano teacher, a special worker at your doctor’s office, or even your regular waitress at the local restaurant. When it comes to these workers, erring on the side of generosity can never be wrong. However, you’ll have to decide how much.

That said, there are certain types of workers who should not be tipped. For example, most salaried professionals do not expect a holiday tip, and might be slightly put off if they receive one. Think doctors, dentists, and lawyers, if you’re trying to decide who not to tip.

When Money Is Tight

If your holiday tipping list has grown beyond what you can afford, don’t despair. Most people understand that money is tight these days, and many service workers don’t actually expect a tip at all.

In fact, a fairly recent study from Consumer Reports shows that the majority of people tipped very few people on their theoretical list of service providers, although some workers fared better than others.

For example, the 2011 survey showed that 53% of participants tipped their housekeeper with cash, check, or a gift card, while only 7% tipped their garbage collector. Meanwhile, 75% of respondents never tip their lawn care crew, and more than 50% don’t tip their barber or hair stylist for the holidays.

Of, course there are ways to show your appreciation that don’t involve writing out a big, fat check or stuffing an envelope full of cash. Consider these alternatives:

Make Homemade Gifts

If you have more time than money, perhaps you should consider freshening up your creative skills a bit and putting them to work. If you have a knack for Pinterest-worthy edibles or homemade scarves, you’re already ahead of the game. Still, almost anyone can make something, right? Consider these options:

  • Homemade cookies, brownies, or breads wrapped in holiday wrapping
  • Homemade pasta sauce or salsa, in a mason jar with a festive lid
  • Homemade candles (if you’re daring)
  • Personalized Christmas ornaments
  • Framed pictures

If you can sew or knit, you could always make personalized Christmas stockings for anyone on your list, or even holiday mittens or scarves. If you need inspiration, the Internet is a treasure trove for holiday gift ideas that can fit into any budget. Try Pinterest or a Google image search if you want to browse through a ton of realistic options in a short amount of time.

Write Thank-You Letters

A sincere thank-you letter is always appreciated — sometimes even more so than a homemade gift or treat, or even money. That’s because, inexpensive or not, a handwritten thank-you note shows someone that you took the time to express your genuine gratitude and appreciation for all they have done for you throughout the year.

If you want your written thank-you to invoke the holiday spirit, write it on holiday paper purchased from the local Dollar Store and use holiday-themed stamps when mailing. People will notice the extra effort you put into it and appreciate it.

Only Tip a Hand-Selected Few

If you can’t afford to tip everyone, that doesn’t mean that you shouldn’t tip anyone. In other words, don’t feel like holiday tipping is “all or nothing.” You might work with certain providers more often or receive exceptional service from a few. If you feel like certain workers deserve a tip more than others, don’t feel bad for rewarding them.

Holiday Budgeting Tips

Holiday tipping may be all about showing service providers how much we appreciate them, but it also needs to fit within your personal budget as well. And that’s the most stressful part about the holidays, isn’t it? In addition to attending a whole host of events, it also seems like we’re expected to purchase gifts for nearly everyone we know.

But it doesn’t have to be that way. If you want to free up funds to tip the service providers who make your life easier, consider these holiday budgeting tips:

Limit Gift Exchanges

Gift exchanges with close family members and friends are one thing, but random, generic gift exchanges are an entirely different animal. You know the type I’m talking about: the show-up-with-a-$20-gift-and-trade-it-around-all-day kind where you arrive with a $20 ceramic angel and leave with a new set of jumper cables. If you’re looking for easy things to cut, start here — chances are, you’re not the only one who thinks it’s overkill.

Stop Buying for Extended Family Members

Once you’ve opted out of the compulsory gift exchanges, it might be time to do a little weeding around the perimeter of your family tree.

For example, your third cousin that you only see once a year doesn’t really need a gift from you, does she? And her now full-grown kids (who never manage to show up) likely don’t either.

However, you should let any family members know ahead of time that you won’t be bringing them a gift this year if you want to avoid any awkward situations.

Limit Your Overall Shopping Budget

Family members who made the cut will likely appreciate getting a gift from you, but there’s still a point of diminishing returns. In order words, they will probably appreciate a $25 gift nearly as much as a $50 one, or a $50 gift just as much as a $100 gift, and so on.

If you want to limit the damage of your holiday shopping bill but still spread the joy around, come up with a reasonable figure to spend on each person you plan to buy for — and stick to it.

Planning Ahead for Next Year

If you’re planning late this year and running over budget, you can always start fresh next year with a new strategy and plan to make it happen. For example, if you find that you spent a total of $800 on gifts for family members and tips for service providers this year, create a plan to save that amount ahead of time next year, in the most painless way possible. Here are a few strategies you could try:

  • Try setting up a separate savings account just for gift-giving: Contribute to your account monthly or on every payday until you reach your target number.
  • Make your savings automatic: Afraid you’ll forget? Set up automatic bank transfers to your new account on the first day of the month or on payday, whichever works best.
  • Use extra money: Beef up your holiday savings fund by setting aside a certain percentage of any “found money” you come across. This could come in the form of a bonus from work, your tax refund, or side job, or an inheritance.

Tipping the people who work so hard for us during the year is important, but so is showing them that we care. And truthfully, the most valuable thing you can offer is your sincere gratitude. And whether you give cash, purchase a thoughtful gift, or write a note that shows you care, your effort will be noticed and appreciated.

Do you tip service providers during the holiday season? If so, how do you determine how much to give? Tell us about it in the comments section.

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