Money Management

The pressure to tip is getting out of hand. Read on to see how you can cope. 

Dining at restaurants is something you might do sparingly. On the other hand, you might frequently find yourself running into a coffee shop for a muffin to go, or stopping at a food cart when you need to pick up lunch in a hurry.

In all of these scenarios, you’ll likely be asked to leave a tip before heading along on your merry way. And you may not exactly know how to handle those requests.

Tipping culture has, in the eyes of many people, gotten out of hand over the past year or so. There was a big push to tip restaurant and food service workers generously during the pandemic, when it seemed as if these folks were effectively risking their lives to do their jobs.

These days, though, working as a server or at a food counter seems like a less precarious option. Yet the pressure to go above and beyond on the tipping front still exists.

New data, however, reveals that consumers may finally be pushing back against tipping culture. So if you’re tired of running up extra-high credit card tabs due to excessive tipping, you may want to rethink your strategy.

Americans are tipping less

Recent data from Toast shows that Americans are starting to scale back on tipping. During the second quarter of 2023, total tips averaged 18.9% of total check amounts, down (albeit just slightly) from 19% during the first quarter of the year. Tips at full-service restaurants declined from 19.7% of total check amounts during the first quarter of 2023 to 19.4% in the second quarter.

That represents the lowest average tip since the start of the pandemic based on the data Toast has on file. But it’s also easy to see why.

In addition to suffering from tipping fatigue, diners may be frustrated by the fact that restaurants have taken to adding a surcharge for paying by credit card. Businesses are charged processing fees by credit card companies, so restaurants are imposing those surcharges for a reason — they’re trying to pass the cost onto consumers. But seeing as how restaurants commonly ate that cost before the pandemic, a lot of people are less than enamored with the practice.

There’s also the fact that just about every single food establishment these days seems to have a checkout option that pressures customers into leaving tips. It’s one thing to tip 20% when a server has shuttled food and drinks to your table several times over the course of an hour. It’s another thing to be asked to tip 20% when you ran into a cafe and simply asked a counter worker to hand you a premade sandwich.

Come up with a system that works for you

Trying to navigate restaurant and food service tipping can be maddening. So a good bet is to try to come up with some sort of consistent approach to tipping so you’re not forced to stress out or feel bad every time you’re asked to pony up.

It might help you to divide your dining into three categories:

Sit-down mealsDeliveryTakeout/counter service

For sit-down meals, consider being generous with tips if you can afford to. Servers are often paid below minimum wage, and so they rely on tips to make ends meet. That said, don’t feel bad if you decide to limit yourself to 20% tips at sit-down establishments. That’s long been the standard, and it’s reasonable.

It’s also customary to tip someone who delivers food to your door. However, many people will tell you that 20% isn’t necessary in that situation, and that 10% to 15% is acceptable.

Keep in mind that some food delivery people may be spending a lot of money just to do their jobs, like paying to maintain and put gas in their vehicles. If you can swing it, you may want to tip 10% for deliveries where your driver was only on the road a short while and 15% in situations where it was clearly a longer drive.

Finally, there’s takeout and counter service. Some people insist that there’s no need to tip if they’re the ones who are going out to get their own food. Similarly, some people refuse to tip counter people who are simply handing over premade food.

This is probably the toughest category to come up with a system for, so go with your gut while considering your financial situation. If you can afford to leave a small tip in these situations, go for it.

But if the point-of-sale machine gives you the choice of 15%, 20%, 25%, or “other,” by all means, choose “other” if you’ve simply picked up a muffin or sandwich and want to tip 5%. It’s certainly better than nothing.

It’s hard to figure out what to tip and when to tip in the context of eating out. Your best bet may be to try to find a system that works for you and just run with it.

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We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.The Motley Fool has a disclosure policy.

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Craving more vacation time? Read on for ways to get it. 

There are numerous benefits to owning a small business, like being able to run your own show and enjoy personal financial success when your venture is profitable. But being in charge of a small business is not an easy thing. And it can often lead to a poor work-life balance.

It’s hard to get away from the grind when you’re the person who’s ultimately in charge of every decision. And you might have a hard time booking travel due to the constant worry that something will inevitably go wrong the moment you board your plane.

A recent Incfile survey found that 33% of small business owners long for more time off and relaxation. So if you feel similarly, it’s important to do what you can to take time off — for the sake of your mental health as well as your business.

If you don’t ever allow yourself to get the breaks you need, you might quickly burn out. That could have negative consequences for your company’s bottom line. If you’ve been struggling to take time away, here are some tips to employ.

1. Focus on short breaks, rather than extended ones

When you’re in charge of running a business, escaping for seven or 10 days at a time may not always be feasible, or even desirable. A lengthy vacation may not even be worth the stress you experience in the weeks leading up to and following it.

But just because taking longer breaks isn’t doable doesn’t mean you can’t benefit from a day or two off here and there. So rather than take an all-or-nothing approach to time off, embrace opportunities to take time off when you can.

If it’s a slower week at work, bail on your afternoon tasks and enjoy some downtime. Or schedule a full day off when you anticipate a quiet stretch. You may be surprised at how much those shorter breaks allow you to recharge.

2. Train employees to take over some of your key tasks

It’s hard to hand over control when you’re a business owner who’s used to being in charge all the time. But if you want to make it easier to take time off, train trustworthy employees to take over some of your essential tasks.

This doesn’t necessarily mean you have to hand over every password to every financial account in your company’s name. But you may be able to hand off some administrative work so it becomes easier for you to escape when you need to.

3. Don’t be afraid to hire temporary help

There may come a time when you do need to take that week-long vacation — for your own sake and for the sake of your family members, who also deserve a real break. If that’s the case, there’s nothing wrong with hiring temporary help to make up for your absence.

Clearly, you’re not going to assign a temp worker your most essential tasks. And you certainly aren’t going to hand over key information, like your bank account password.

But you may be able to find someone to handle specific aspects of your job. For example, if you tend to inspect and manage inventory when it arrives at your storefront, you may be able to train someone else to do that work for a week while you’re gone.

Also, the temporary help you hire doesn’t necessarily have to be for your usual tasks. You may want to bring in reinforcements so that one of your permanent employees can abandon their usual post for the week and take over some of your duties instead.

It’s not an easy thing to take time off when you own your own business. But it’s an important thing nonetheless. So if you can’t remember the last time you didn’t show up for work, take the opportunity to escape, even if only for a short amount of time.

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We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
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Costco is supposed to help consumers save money. Read on for ways that help you do more of that. 

A big reason many people shop at Costco is to save money on household products and grocery purchases. And if you play your cards right at Costco, you might manage to save money consistently.

The problem with Costco, though, is that it’s huge. Specifically, its inventory is huge. And when you’re shopping at a warehouse-sized store that sells everything from dried fruit to winter coats to fun-looking kitchen gadgets, it can be easy to rack up a higher credit card tab than expected.

The good news, though, is that with a few tweaks, you can set yourself up to spend less money at Costco. And these strategies aren’t particularly complicated. All you need to do is commit to sticking to them.

1. Read the coupon book before you head to the store

If you’re a Costco member, you’ll get a coupon book in the mail roughly once a month, which is generally the pace at which Costco rotates its sale items. If you can’t seem to find your coupon book, worry not — it’s available online, too.

The simple act of reading through that coupon book could help you eke out more savings at Costco. You might, for example, notice that the laundry detergent you use is on sale for $5 off. You may not need detergent at the moment, but if you have space to store it, it pays to scoop it up while it’s discounted.

Also, rest assured that you don’t actually have to bring your coupon book with you to Costco to get those deals. You’ll get those discounted prices automatically when you check out.

2. Keep certain aisles off limits

There are certain Costco aisles that might lend to impulse purchases. So if you know what those are for you, stay out of them. It’s that simple.

Let’s say you tend to have a hard time saying no to fun-looking snacks, but you also know that your pantry is already loaded with them. In that case, don’t go into the snack aisle — not even for a quick glance. And if there’s another item you need in that aisle, make a beeline for it and exit in short order.

If you don’t trust yourself to stay out of certain aisles, bring an accountability buddy along on your Costco trips. Make it that person’s job to reprimand you for going off-list. That person can be a trusted friend, a spouse, or even a child of yours if they’re old enough to get in your face and try to enforce the rules.

3. Look at expiration dates

Since Costco prides itself on quality, you might assume that all of its food items have good expiration dates. But that’s not always the case.

You might visit the store on Nov. 10 and find milk with a sell-by date of Nov. 19 or Nov. 29. The latter is clearly the better buy. But if you don’t pay attention, you might risk purchasing items you have to partially dump due to them going bad.

Also keep in mind that it’s not just perishable items you have to pay attention to. Foods like snacks and spices can go bad over time, too. And when you’re buying them in bulk quantities, you run that risk even more.

If you don’t see an expiration date you’re happy with for a given item at Costco, flag down an employee and ask if there’s more inventory available. They may be able to help you find a better expiration date. Plus, they might choose to pull items from the shelves whose expiration dates aren’t so great, thereby sparing other customers the annoyance of buying things that go bad on them quickly.

Ideally, your Costco membership will result in a world of savings. And if you stick to these easy tips, you may find that you’re able to spend even less.

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We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.Maurie Backman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Costco Wholesale. The Motley Fool has a disclosure policy.

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Buying a home in not such great shape could save you money. But read on so you’re aware of a big trap you might fall into. 

You’d think today’s sky-high mortgage rates would’ve led to a massive drop in buyer demand, thereby bringing home values down. But the National Association of Realtors reports that the median existing home sale price in September was $394,300. That’s a 2.8% increase from a year prior.

Because homes today are so expensive, you may be eager to do what you can to snag a lower purchase price. One option, of course, is to look for one in an up-and-coming neighborhood rather than focus your search on neighborhoods that are already well-developed. Another option may be to move to a more rural area with fewer amenities where the average price per square foot is lower than what you’ll find in popular cities and suburbs.

But there’s a third route you could take to save money on a home purchase, and it’s buying a fixer-upper. If you’re fairly handy and are confident in your ability to tackle renovations, then it could make sense to spend a lot less on a home and work at your own pace to make it move-in ready. Plus, this way, you’ll get the chance to put your own stamp on your home.

While buying a fixer-upper might be a good solution in theory, there’s one big pitfall you’ll need to look out for if you’re going this route. And it’s a pitfall that could get in your way of seeing your mortgage go through.

When you run into issues with your appraisal

There are certain steps you need to take to finalize the mortgage process. One is to undergo underwriting, where a mortgage lender takes a deep dive into your finances to make sure you’re in a strong-enough financial position to borrow the money you’re asking for.

Another step needed to finalize your mortgage is to have the home you’re buying undergo an appraisal. And the reason is simple.

Your mortgage lender needs some degree of protection in case you end up falling behind on your mortgage payments. So your lender will want to make sure your home is worth at least as much as the sum you’re borrowing. That way, if things reach the point where your lender has to force the sale of your home to get repaid, it can feel confident the home will command a high-enough price to cover your loan balance.

If you’re buying a fixer-upper, though, then the property you’re looking at may not appraise for a high enough value to satisfy your lender’s requirement. And that could result in you losing your mortgage.

Let’s say you’re looking to buy a $220,000 home and are putting $20,000 down. That means you’re aiming to borrow $200,000. If that home only gets appraised at $190,000, your lender isn’t going to loan you $200,000. That leaves you with a problem on your hands.

What to do if your appraisal comes back low

When you’re buying a fixer-upper, you run the risk of having issues with your appraisal. But you still have options if that number comes back low.

One is to renegotiate your purchase price so you don’t have to borrow beyond that home’s appraised value. Another option is to put more money down on your home if you have it. So all told, you’re not totally out of luck.

To be clear, just because you’re buying a fixer-upper doesn’t automatically mean that your home isn’t going to appraise for the value you need it to. But it’s a risk to be aware of nonetheless.

As such, if you specifically have your eyes on a fixer-upper, be mindful of potential appraisal issues. And consider buying a home that’s not at the very top of your budget in case you end up needing some leeway after making your offer.

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We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.The Motley Fool has a disclosure policy.

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