Dog ownership comes with many responsibilities, and keeping your dog clean is one of the most challenging. Some owners tackle the bathing, brushing and trimming themselves, while others pay for a dog grooming service. If you’re one to leave it to the professionals, you may have wondered if you’re supposed to add a gratuity after receiving the bill.
Start with the average cost of dog grooming
Tips are often calculated by taking a percentage of the total bill. A basic grooming service can cost $50 to $75, according to Erin Myers, a grooming expert and project analyst at the American Kennel Club.
According to etiquette experts, the industry standard for tipping service professionals is 15% to 20% of the bill, so for dog groomers that would work out to $7.50 to $15. If you’re unsure, use our tip calculator.
Factors that could affect the size of your bill or tip
While calculating a percentage of the total bill is a good place to begin, there are some other things that may influence your tip.
Dog breed and size: Some breeds require a little extra maintenance, especially if they’re prone to matted fur or shedding (think poodles and bichon frisés). If your dog needs lots of brushing or a special haircut, you might want to consider that in your tip. Bigger dogs also can take longer to groom.
Temperament: If your dog hates getting groomed and is difficult to manage, it might make the appointment last longer and, potentially, endanger the groomer. Consider tipping more if this sounds like your dog.
Salon address: Location influences the prices of most things, including grooming. People going to a shop in an urban area should anticipate a larger bill and expect to pay more in tips than those in suburban or rural areas.
Mobile vs. brick and mortar: A mobile grooming service can be a convenient option for owners who find it difficult to bring their dog to a salon. However, Myers says “people should anticipate that [mobile grooming] is going to be a little bit more expensive” to cover vehicle gas and maintenance, permits, specialized equipment and the fact that mobile groomers can typically care for only one dog at a time. When calculating how much to tip a mobile groomer, take these factors into consideration.
Quality of service: The salon’s cleanliness, groomer’s communication style and your dog’s final appearance will likely influence how much you tip. Myers suggests assessing your dog after a groom to make sure that there are no tangles, cuts or other issues because they could be red flags for subpar work. If you feel like you received poor service, you might tip less than 15% or nothing.
Number of groomers: Some groomers do everything from start to finish while other salons have groomers dedicated to different parts of the process. If there is a division of labor, you might want to spread out the tip.
How to reduce your dog grooming bill
The cost of grooming should be top of mind before you adopt or purchase a dog. If the breed you want needs regular grooming, include those recurring expenses in your budget. Many people consider pets to be family members, which means veterinarian and grooming expenses might fall under the “50% for needs” category within the 50/30/20 budget framework.
Here are some other ideas to help cut costs:
Get a shorter cut to go longer between grooms. This extended timeline can save you money in the long run.
Join a loyalty program and take advantage of seasonal promotions. Some groomers might offer discounts after completing a number of visits or feature holiday specials.
Keep up with at-home grooming between services. Taking over more manageable aspects of your dog’s care, like ear cleaning or toenail clipping, can make your groomer’s job quicker, potentially leading to lower costs.
Switch to a national chain. If you’ve been going to a mom-and-pop groomer, you could save money by taking your dog to a national chain where tipping isn’t expected, according to Myers.
Check to see if your pet insurance offers a wellness plan. Some providers let you add on certain grooming services.
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Should you tip a dog groomer?
A grooming appointment can last two to four hours, according to PetSmart, a national pet retail chain. The average appointment includes brushing, ear cleaning, toenail clipping, bathing, drying and styling. Groomers may be grappling with scared or grumpy dogs who make the job more challenging. If your groomer delivers consistent results and is kind to your dog, tipping is a way to show your appreciation
What if you can’t afford to tip?
If a 15% to 20% tip isn’t feasible, tipping a smaller amount might be an option. You could also reserve your tip for the holiday season, which can be a time to thank the service providers who make your life easier throughout the year. Adding a line in your holiday budget for your groomer will give you time to plan and save for the extra cost.
Myers suggests having an open conversation with your groomer about tipping when you drop off your dog. Asking for the costs upfront and establishing whether a tip is expected can help build an honest relationship.
If a tip isn’t in your budget, there are other ways to show your appreciation. Posting a positive review online could help boost business, and praising your groomer directly to their manager is a kind gesture.
Tipping cultures can vary significantly between countries. While many service workers in the U.S. rely on tips as part of their compensation, that’s not the case universally. Between the U.S. and Japan, specifically, there is a huge difference in the tipping culture
In fact, travelers should generally avoid tipping in Japan. There are a few rare cases when a tip is appreciated. Let’s go through when tipping in Japan is appropriate and when you should show your appreciation with a heartfelt “arigato gozaimasu” (thank you).
Do you tip in Japan?
The short answer: No. In some situations, trying to leave a tip may be even off-putting. As wild as that may seem to American travelers, Japanese culture prioritizes excellent service without any expectation to provide a financial tip as appreciation.
Whether you get service from a restaurant server, bartender, hotel housekeeper or even a taxi driver, prices are set at a rate where workers are compensated with a fair wage.
For travelers visiting Japan, the general rule should be to avoid tipping. However, there are a few situations where a tip is appreciated. Here’s a breakdown of some specific dos and don’ts.
Do you tip at restaurants in Japan?
Travelers should avoid leaving a tip in restaurants in Japan. This is the case regardless of the type of restaurant — from counter service to a sit-down multi-course meal — and the quality of the service. The expectation is that prices are set at a rate that the owner will provide fair compensation to servers.
Some Japanese bars or izakayas may charge a small cover charge. This is typically referred to as “otoshi” and may or may not be posted at the entrance to the bar. Ask before being seated if you’re concerned about this charge (typically only a few dollars).
The telltale sign that you’ll be charged an otoshi is if you get a small appetizer upon sitting down.
Do you tip taxi drivers in Japan?
With Japan’s incredible public transportation, travelers should have little need for taxi drivers to get around. Because of this, Japanese taxi drivers generally provide top-notch service. From white gloves to automatically opening doors, taking a taxi in Japan is like no other. Again, your instinct may be to show your appreciation with a tip.
But here again, travelers will find their offer rejected. Don’t have exact change and want to round up? Many Japanese taxi drivers will provide exact change, down to the yen.
Do you tip tour guides in Japan?
One of the few places where tipping in Japan is appreciated is for tour guides and interpreters. What’s the commonality? These service providers primarily serve international tourists, many of whom are accustomed to tipping. For this reason, many tour guides and interpreters won’t turn down a tip when it’s offered.
To truly show your appreciation, do a bit of legwork beforehand and take a couple of small envelopes with you. Flashing cash is seen as inappropriate, particularly in public. Instead, place your tip in an envelope and hand it to your recipient with both hands.
Again, though, tipping isn’t expected in these cases, but it won’t come across as rude. Since there’s no expectation of a tip, there are no guidelines about how much to tip.
Tipping geishas and at ryokans
Geishas (female Japanese performing artists and entertainers)and ryokans (traditional Japanese inns with attentive service) are two ways to experience exceptional authentic Japanese service and culture. Considering the lack of tipping elsewhere in Japanese culture, it’s ironic these are two times when it can be appropriate to provide a tip.
When having a private dinner with a geisha, you can opt to provide an envelope with cash to show your appreciation. Currently, the custom is to give around $20 (3,000 yen) per person. This money should be in an envelope and handed to the geisha with both hands and a dip of your head.
At high-end ryokans, it’s appropriate for guests to show their appreciation with a tip for attendants or the owner, either at check-in or left on your bed at checkout. Here a tip of $7 (1,000 yen) per person is seen as customary.
Should you insist on leaving a tip in Japan?
In many Asian cultures it’s seen as polite for someone to turn down a gift on the first offer. This isn’t the case for tipping in Japan. If you attempt to leave a tip and the offer is politely rejected, don’t insist on providing the tip. While your offer may be perfectly well-meaning, it can come across as rude in Japanese culture.
Final thoughts on tipping in Japan
Traveling and experiencing different cultures can help you re-examine the cultural norms that you’re used to. For Americans, the lack of tipping in Japan can be one of those times for reflection.
In the U.S., it’s usually rude not to tip servers, bartenders and taxi drivers. The opposite is true in Japan. Even attempts of tipping in Japan can seem off-putting, as it can be interpreted as a sign that you feel the service worker isn’t fairly compensated for the price charged.
Instead, show your appreciation by learning about Japanese culture and memorizing some Japanese phrases.
Keep your voice down in public — except in izakayas — or other places where letting loose is expected. Be mindful of the appropriate places to wait to board trains and queue outside restaurants. Learn to hand and receive payment cards and business cards with both hands. And internalize arigato gozaimasu as the appropriate way of showing your appreciation for good service when visiting Japan.
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Inside: Are you unsure about how much to tip your valet? This guide will help you understand valet parking tips and the dollar amount for tipping at hotels and restaurants.
Navigating the ins and outs of tipping etiquette can be daunting, particularly when it comes to highly personalized services such as valet at five-star hotels.
You certainly want to show appreciation and respect for the quality service they provide, while inherently being cognizant of not going over the top. From the length of your stay to the level of service rendered, the cost of parking, and even the locale, several factors can sway this figure.
Parking can be a hassle, and that’s where valets step in. They’ve got your back, navigating tight spaces and dodging traffic to park your vehicle. But what do you owe them in return for their hard work and risk?
Honestly, this is a similar question of wondering how much to give for high school graduation.
This guide dissects the intricacies surrounding valet tipping, helping you confidently reward exceptional services without breaking any unwritten societal norms.
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How much should you be tipping your valet?
The rule of thumb for tipping valets is $3 to $5 when dropping off and picking up your vehicle.
This is your baseline, but don’t hesitate to scale up if your driver impresses you with their service. If you’re staying at a place just for a night, a tip of $5 to $10 is seen as appropriate. For multiple nights, you may tip more generously on your first and last night.
Always remember, that your generosity reflects the level of service you’ve received.
The average tipping amount will vary in areas like New York City, Boston, Chicago, anywhere in California, or even Aspen, Colorado as these areas demand a higher tip.
What is proper etiquette for tipping valet?
Proper etiquette for tipping valet is about communication, patience, and gratitude. Ease into the drop-off zone without creating chaos, let your valet know about any special needs or quirks about your car, and stay patient. Afterward, express your thanks with a tip.
Yes, that means you need to have cash on hand.
It’s no crime to ask your valet what’s common for a tip if you’re not sure. This opens up a dialogue and they’ll understand you’re considering their efforts. Whether you tip before or after is wholly your call, but keep in mind that a tip at the start might earn you that extra mile of service.
Be generous, but fair. If you’re pulling up in a more luxurious car, consider a higher tip. The value of your vehicle is a good indicator of your tipping ability.
That said, only tip if you want to and think the service merits it. If your experience was less than satisfactory, bring it up to management instead of slipping a bill. Not tipping isn’t rudeness on your part if the service didn’t meet your standards. But if it did, good etiquette is acknowledging that quality service with a tip.
Valet Parking 101
Valet parking is an efficient service often offered in high-end restaurants and accommodations, providing a hassle-free parking experience, especially in areas that are limited in parking space.
The basics to avail of these services is to drive into the drop-off zone and hand over your vehicle to the attendant, ensuring you’ve removed any personal items and communicated any particularities about the car.
Valet parking etiquette isn’t complex. However, if you are well prepared, it makes the experience more delightful.
Be Alert at Drop-off. Drive with care into the drop-off zone and follow any directions from the valet. Don’t be in a hurry!
Prepare Your Vehicle. Have your car ready for valet parking by removing all personal and valuable items before arrival.
Communicate. Brief the valet about your vehicle’s quirks and intricacies, like touchy brakes or an alarm system.
Show Patience. Give the valet time to park, retrieve, and return your vehicle. They could be overwhelmed with multiple tasks during peak hours, so don’t rush them.
Show Gratitude. Beyond tipping your valet, express your gratitude verbally. A simple ‘please’ and ‘thank you’ can make their day.
Keep the Ticket Safe. You don’t want to hold up the process because you misplaced the claim ticket.
Respect the Flow. Respect the orderliness at the vehicle drop-off zone. The valets have an efficient system for quick drop-offs and pick-ups.
Prep for the Evening. Make sure you have everything you need for your event or stay. The valet can retrieve items from your car, but it’s best to avoid extra trips.
Remember, these simple considerations can greatly affect the smoothness of your valet experience.
An important note – if the driver who retrieves your car is not the same one you gave it to, you might want to tip both.
To Tip or Not To Tip? The Valet Parking Conundrum
With tip-flation out of control in the United States, you may be wondering if tipping your valid is worth it.
Sometimes, tipping can get situational. Let’s consider times when you might tweak the ‘usual’ amounts.
If you’re arriving during peak hours or on a busy weekend, tip more generously. Your valet is juggling a higher volume of cars and more stress, so your tip is a recognition of that hard work. On the other hand, slower hours might warrant a more modest tip.
Your vehicle type should also influence your tip. Driving a luxury or high-end car? That’s a premium charge for your valet, too. Running a more modest set of wheels doesn’t demand the same generosity.
Did your valet go above and beyond? Offering assistance with bags, driving directions or just a friendly demeanor might earn them a little extra.
Forget something in your car? Ask your valet to bring it back, but remember to compensate for their time. If you’re accessing your vehicle multiple times in a single day, consider an additional tip for the added service.
And finally, if you want to ensure your car gets a prime spot, or preferential service, tipping more upfront can help.
All in all, pay attention to how much to tip a valet given the situation. Tip when you feel the service warrants it and remember, it’s not just about the money – the thought counts too!
Should service quality affect your tip?
Absolutely! Service quality is a big factor in how much to tip a valet. Just like you might adjust a restaurant tip based on service quality, you should do the same with valet parking.
For example, if the valet is unfriendly, rude, or handles your vehicle poorly, they shouldn’t expect a hefty tip. At its core, the tip signifies gratitude for good service. Do keep in mind that errors happen, though. If a mishap occurs, such as a delay or a minor mistake, consider informing the manager rather than taking it out on the tip.
Conversely, if your valet provides outstanding service, they should be rewarded appropriately. So, if they treat your vehicle with care, offer assistance with luggage, close your trunk, or provide useful information about the locale, you might want to tip more.
Remember: Adjusting your tip based on the quality of service is not being stingy or overly generous; it’s fair compensation for service rendered.
Do you tip valet before or after?
Tipping before or after for valet service is rather circumstantial and both have their merits.
Tipping upfront might ensure your valet goes the extra mile for you.
Whereas, tipping at the end allows you to assess the service quality first.
The choice is entirely up to your discretion and how you feel about the service!
The misconception is you can get away with not tipping at all.
How much do you tip a valet at a hotel?
The standard courtesy tip for a hotel valet hovers around $5 per car. But hold on, as these aren’t hard-set.
Staying the night? Then consider a tip of $5 to $10; more if it’s for multiple nights.
Meanwhile, high-end hotels usually see higher tip values. A $5 to $10 tip per vehicle is considered suitable given the upscale services rendered.
Remember, the situation might vary depending on a gazillion factors like the destination, hotel class, length of stay, and level of service received. So equip yourself with a tipping strategy best suited for your specific scenario.
When they retrieve your car after your meal, how much should the valet parking tip be?
The baseline remains the same, you’re looking at a minimum of $3 to $5 per car.
But say the meal was special, the night was beautiful, or maybe you’re just in a good mood. Feel free to upgrade a little more to that tip. After all, it’s a token of appreciation for the valet who’s been managing your car while you dined in comfort.
In contrast, suppose their service was not up to your expectations. Maybe they made you wait too long or were discourteous. You then have a valid reason to tip less.
What if you don’t have enough cash?
If you are like me and find yourself without enough cash, there are still a few options to consider.
Ask if their valet services allow tipping through a credit or debit card or even Venmo, although cash is generally preferred.
Give a larger dollar bill when you are leaving the restaurant or checking out of the hotel.
When trying to determine how much cash should I have in my wallet, remember what you may need for tipping your valet.
Regardless, it’s always a good idea to keep some cash on hand for gratuities, to avoid inconvenience or potential embarrassment.
Hospitality Valet Expert Speaks
Jorge, a seasoned valet from the Grand Hyatt Vail, shared some fascinating insights into his job.
Despite the physical demands, Jorge takes pride in delivering exceptional service, swiftly handling numerous vehicles, and making guests’ transitions as smooth as possible. He underlined that gratuity is a crucial appreciation of this labor-intensive service.
Much like the data-driven research suggests, Jorge finds that guests who tip considerably when dropping their car off often get retrieval of faster service.
Also, he noted that tips are shared each day among the valets. This was to ensure there wasn’t favoritism and that all guests received the same service.
Why tip valets?
Valets offer a luxury service. They work hard to save you the hassle of parking, allow you to directly access your venue of choice, and take care of your vehicle in the process.
Valets are also part of the service industry, which means their income often depends heavily on the tips they receive. They brave the elements, handle the stress of navigating unaccustomed vehicles through tight spots, and often do so with a smile on their faces.
Not to mention, they’re on their feet for entire shifts, often dealing with demanding clientele and long working hours. By tipping your valet, you show appreciation for their hard work and encourage them to keep up the high level of service.
Why not show your gratitude with a few extra bucks? It’s a small price to pay for convenience and quality service. So, the next time you pull up to the drop-off zone, remember, your valet deserves that tip.
What do valets expect?
Valets, like other service industry professionals, expect respect and decent compensation for their hard work. This not only includes a fair hourly wage but also tips for the service they provide.
Valets typically expect a tip of around $3 to $5 per vehicle, although this can vary based on location, type of establishment, and how busy it is. In upscale areas, tips can range from $5 to $10 per car.
Additionally, valets appreciate when customers are understanding and patient, especially during peak hours. They also value clear communication about any special requirements or characteristics of your vehicle.
What’s considered a “good” tip?
A “good” tip for a valet typically starts at $5 per vehicle. This is generally considered the norm at most establishments.
However, a “good” tip can depend on several factors, like the establishment and service quality. At high-end hotels or restaurants, or in more upscale locations, a “good” tip might start around $10 or even $15.
With that in mind, treat your personable, hard-working valets to a good tip when they provide a great service. After all, a good tip results in good karma!
FAQs
Yes, you should still tip even if the valet service is complimentary. The valet is parking your car, often in the tight valet lot. Their service saves you time and stress, and that’s worth a tip.
Remember, many valets earn a small hourly base pay and rely heavily on tips. Their pay may not correlate with the price you pay or don’t pay, for the service.
A $20 tip for valet is usually seen as generous. It’s well above the typical range of $3 to $5. However, if you feel the service was exceptional, you have a high-end vehicle, or if the valet went above and beyond, such a tip could be appropriate.
Tipping valets at 5-star hotels usually follow a higher standard. Considering the upscale locale and high level of service, a good starting point is around $5 to $10 per vehicle. So, yes, $20 is a good tip for valet.
Furthermore, if the service exceeded your expectations, or if the valet provided additional help like carrying your baggage, a tip on the more generous side might be appropriate
Now, How Much to Tip Valet Driver?
In the United States, tipping is very much a part of our culture and how many people make their living.
Tipping valet can seem intricate, but it’s straightforward once you know the ground rules: anticipate, be kind, respect the service, and tip accordingly. It all comes down to recognition of the efforts your valet puts in to make your experience easier and classier.
The takeaways are the general tip range ($3 to $5).
However, you need to base your tip on the type of establishment, time of day, and quality of service. Be aware of the situation and tip accordingly. But, above all, remember to appreciate good service and acknowledge it accordingly.
Now, be careful, you need to know how much cash can you fly with.
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If you’ve ever taken an Uber, you’ve probably been asked to add a tip and rate your driver at the end of the trip. Some internal questions that may arise shortly after are how much should you tip or whether to tip at all.
Tipping can be tricky business, especially when it comes to rideshare services like Uber or Lyft because there isn’t a clear standard. Here is a guide to tipping Uber drivers that may help next time you take a ride.
Do you have to tip an Uber driver?
Uber doesn’t make tipping mandatory, so there’s no requirement that you tip your driver. However, just like other workers in the service industry, Uber drivers often rely on tips to supplement their pay.
Uber rolled out its in-app tipping feature in 2017 as an effort to improve drivers’ earnings. Tipping can be a way to support that mission if it’s something that aligns with your values.
Another reason you may choose to tip an Uber driver is if they give you a top-tier experience. An Uber survey shared by the tech company in 2018 found some reasons that riders tip drivers include: having a clean car, sharing a good conversation, helping with luggage, making a phone charger available and playing good music.
How much should you tip an Uber driver?
After completing a ride, Uber suggests tipping your driver and prompts you to give a preset dollar amount — such as $1 or $5 — or enter a custom amount. You can stick with one of these suggestions or give a more generous tip if you want. If you need a benchmark, consider calculating your tip based on the total ride cost.
In the service industry, restaurants sometimes make the standard tip clear by leaving recommended percentages at the bottom of receipts or as a pop-up on the machine used for credit or debit card payments. Some restaurants suggest tipping between 15% to 20% of the bill — a benchmark you could also apply to Uber rides. For instance, if you take a $35 ride, you may decide to tip $5.25, which is 15%.
In the event an Uber driver delivers poor service, you may choose to give a smaller tip or nothing at all, similar to at a restaurant or bar.
How much do Uber drivers make per hour?
The average hourly pay of an Uber driver can range from about $8 to $31 an hour. That said, Uber states there are three major factors that impact how much drivers make: fares for trips, tips from customers, and Uber promotions that offer drivers extra cash for completing certain trips. The amount drivers get for rides also depends on the city they live in, how many hours they drive and how far they travel.
Most drivers aren’t taking home the average hourly rate because they incur so many expenses. For one, Uber charges a variable service fee for some trips. In addition, Uber drivers are independent contractors, which essentially means they’re self-employed and not covered by health insurance, retirement plans, employer matches and other benefits. Drivers also have to pay for expenses like their car upkeep, self-employment taxes, and gas out-of-pocket. Keeping all these costs in mind, even if a driver’s earnings are on the higher side, expenses can eat away at the take-home pay.
What happens if you don’t tip?
There is no consequence for not tipping. However, it can be a kind gesture, especially for drivers who rely on tips. While some argue that it’s an employer’s responsibility to pay service workers better wages, drivers offer a service that makes your life easier. For that reason, you may consider giving them a few extra bucks. If you can’t afford to tip, consider using cash-back credit cards to pay for your rides and your tips so you get some dollars back.
Italy has given us pizza, Aperol spritz, the Colosseum, Vespa scooters and Michelangelo, so it’s no wonder people visit the boot-shaped country in droves.
When calculating your budget for a vacation, you might be wondering how much to tip in Italy. Fortunately for travelers, you won’t need to tip much.
When in Rome, you can say “buongiorno” to finger-licking food and “arrivederci” to the tipping culture that we’re so accustomed to in the U.S.
Do you tip in Italy?
Let’s get it straight. Tipping in Italy isn’t compulsory nor is it expected. Italian workers are paid a salary and don’t rely on gratuities to survive, as they do in the U.S.
However, if you feel that excellent service has been provided and you’d like to thank your server with a monetary gift, you can do so, but the amount you leave doesn’t have to be high.
If you insist on tipping, let’s discuss how much to tip in Italy in various situations.
Tipping in Italian restaurants
Let’s say your travel companion and you split a perfectly cooked Margherita pizza, a delicious spaghetti Bolognese and wash it all down with a bottle of a nice Chianti at a sit-down restaurant.
You’re ready to keep walking the charming streets of whatever Italian city you’re in, but one thing stops you in your tracks. The bill comes out, and you’re not sure how much to tip.
The rule of thumb is to round up to the nearest increment of five — e.g. rounding up to €30 on a €27 bill — and leave a few euros on top of the total amount. If you pay with a card, leaving a few coins is enough.
At some restaurants, you might notice something called a “coperto” (cover charge) on the bill. It’s the fixed amount that you’re charged (usually no more than €5, or around $5.50) for a tablecloth, silverware and a bread basket that often comes out at Italian restaurants.
The cover charge gets added to the check on a per-person basis. Keep in mind that this fee goes to the restaurant and not the waitstaff.
If you see a coperto charge on your bill, there’s no need to cause a scene even if you didn’t eat the “free” bread. Expect it when budgeting for a meal at a sit-down establishment.
Tipping in Italian coffee shops or bars
If you order a beverage at a coffee shop or a bar in Italy, you could leave your barista or a bartender extra change from the bill.
However, it’s not customary to tip more, and nobody at the counter is going to flip an iPad at you awkwardly, asking for a 15%, 20% or 25% tip.
Tipping at Italian hotels
If you’re staying at a hotel and want to acknowledge housekeeping for tidying up your room and changing your towels, you can leave €1 euro ($1.10) per night of your stay. And if you’ve packed lots of outfits and a kitchen sink in your luggage, then a euro per bag is appropriate for a porter who delivers your bags to the room.
Tipping taxi drivers in Italy
Do you tip taxi drivers in Italy? Again, you don’t have to, but if you feel compelled to leave something, tell the driver to keep the change.
For example, if your ride was €18 euros (roughly $19.80), handing them €20 before you hop out of the cab is fine.
Tipping tour guides in Italy
Tipping your tour guide is probably the only exception to tipping rules in Italy. Whether it’s a paid excursion or a free tour, you should tip your guide.
We recommend adding a gratuity of €5 ($5.50) per person for a half-day tour and €10 ($11) per person for a full-day tour. As always, if you absolutely loved the excursion and the information provided, feel free to tip more at the end.
Tipping in Italy recapped
As mentioned above, waitstaff in Italy get paid a living wage and there’s no cultural expectation of tipping. However, if you’re so inclined to leave a little thank you for a job well done, no one is going to stop you.
In fact, the cash will be appreciated. Just keep in mind that the tip doesn’t have to be a large one for you to seem grateful for the service provided.
How to maximize your rewards
You want a travel credit card that prioritizes what’s important to you. Here are our picks for the best travel credit cards of 2023, including those best for:
Every time I get my hair cut, I’m faced with a dilemma — should I tip the barber or not? I usually get my hair cut in a small-town shop. I tip $2 on a $12 haircut. If I get to hear stories about Vietnam or histrionic political rants, I tip $3, even if I don’t agree with the barber’s viewpoints. (I tip because I’ve been entertained.) Sometimes, if I don’t have enough cash, I don’t leave a anything at all. Are these tips appropriate?
What about when I pick up Chinese takeout? Should I have tipped the guys who delivered our new gas range last fall? What about a hotel bellhop? A parking valet? Out of curiosity, I did some research on tipping practices in the United States. There’s actually significant disagreement about how much to tip for even common services.
For example, you know you should tip your waitress. But how much should you leave? Some people claim that 10% is adequate. Others claim that 20% is standard. But I suspect that most of us learned to tip 15%, and to give more for exceptional service. (The wikipedia entry on tipping currently contains the bizarre claim that “18% is generally accepted as a standard tip for good service”.) Which amount is correct?
The concern around tipping stems from the need to get it right — offer too little, and you run the risk of offending someone; offer too much, and you needlessly impact your budget. Plus, there’s actually significant disagreement about how much to tip for even common services.
After browsing dozens of pages, I drafted the following guide. The amounts listed are based on averages or on consensus, when possible.
“Tip: (noun) — a small present of money given directly to someone for performing a service or menial task; gratuity” — Dictionary.com
Food Service
It’s common knowledge that you should tip your waitress. But how much should you leave?
Some people claim that 10 percent is adequate; others believe that 20 percent is standard. But a majority of us learned to tip 15 percent, and to give more for exceptional service. (The Wikipedia entry on tipping contains the rather bizarre statement that “18% is generally accepted as a standard tip for good service.”) So which is it?
Service
Tip Suggestion
Comment
Barista
None
Many people suggest putting coins in the tip jar.
Bartender
15% of total bill or $1/drink
Pre-tip for better service
Delivery Person (including pizza)
10%
$2 minimum
Maitre d’
$5
(… up to $25 for special effort)
Takeout
None
None
Waiter
15% for adequate service
20% for exceptional service. For poor service, leave 10% or less.
General holiday tipping guidelines
Holiday tipping is never required. Even when it’s the social norm, you shouldn’t tip if you can’t afford it or you don’t feel the person deserves it.
Tipping tends to be more common (and on a larger scale) in big cities than in small towns. The best way to determine the etiquette in your area is to ask around.
In general, you should consider giving a holiday tip to the folks who take care of your home and family, especially those you see often. The more often you see someone and the longer you’ve known them, the more you should tip. (Someone who works in your home regularly — such as a housekeeper — usually expects a tip.)
For personal services like manicures, massages, pet grooming, and fitness training, tip up to the cost of one session, but only if you see the same person regularly. For example, if you get a $60 massage every six weeks, your holiday tip should be about $60.
Public servants are not allowed to accept cash tips in the U.S., but it’s acceptable to give a non-cash gift of up to $20. You might give a plate of cookies to your mail carrier, for example, or a book or a gift certificate to your child’s teacher.
When you give a tip, include a card or a hand-written note thanking the person for their service.
If you tip cash, crisp new bills make a better impression than old wrinkly ones.
Home Care Service
Here’s a list of people who often receive holiday tips and what they typically receive:
Service
Tip Suggestion
Comment
Babysitter or Nanny
One week’s pay
None
Housekeeper
One week’s pay
None
Building Superintendent
$20 – $100
It varies. Some people think this helps to keep a harmonious relationship with the super.
Doorman
Holiday gift
Bottle of wine
Furniture Deliverer
$5 – $20
It varies. Some people recommend offering cold drinks.
Garbage Collector
$15
(… up to $25 for special effort)
Gardener
One week’s pay
None
Mail Carrier
$15
(… up to $20 non-cash.)
Newspaper Delivery Person
$15 to $25
(… up to $25 for exceptional service.)
Personal Care
Service
Tip Suggestion
Comment
Babysitter
One week’s pay
It varies. Don’t pay this for one-time babysitting.
Barber or Hairstylist
10-15% or 15-20%
Some people recommend $5 to each person who shampoos or blow-dries your hair, and others recommend up to the cost of one visit for the holidays.
Coat checker
$1 per coat
It varies. Some people recommend $2 to $5 upon retrieval.
Home Health Employee, Private Nurse or Personal Caregiver
(… up to a week’s salary)
Check with the agency as some prohibit gifts.
Manicurist
15%
None
Masseuse
10%-15%
None
Nanny
One week’s pay
None
Personal Trainer or Yoga Instructor
$20-$50
Tip discreetly.
Shoe Shiner
$2 or $3
None
Spa Service
15-20%
None
Office Service
Service
Tip Suggestion
Comment
Janitor
$15-$25
None
Parking Attendant
$15-$25
None
Travel
Service
Tip Suggestion
Comment
Bus Driver (not mass transit)
$1-$2
(… if he handles luggage.)
Cab Driver
10%
($2-$5 minimum)
Chauffer
10%-15%
None.
Gas Station Attendant
None
(or $2 -$4 – there’s no agreement on tips).
Porter or Skycap
$1 per bag
(… $2 for heavy items, if the porter brings luggage to counter)
Hotel Staff
Service
Tip Suggestion
Comment
Bellman or Porter
$1-$2 per bag, $5 minimum
Or $1 per bag, $2 minimum
Concierge
$5
(… up to $20 for something exceptional; nothing for directions.)
Housekeeper
$2-$5 per night, paid daily or as a lump sum at checkout
Most suggest you tip daily.
Parking Valet
$2-$5 paid when your car is retrieved
Some say to pay when it’s parked too.
Room Service
$5 minimum
(unless the gratuity is included in check)
Most of these relate to holiday tipping, but some suggestions are appropriate any time of year. Of course, giving a tip is an individual decision. J.D. Roth used to tip the barber extra if he got to hear an entertaining story about Vietnam or histrionic political rants. What influences you to give a larger or smaller tip? Do you have any suggestions to add?
When it comes time to move, hiring movers is a convenient option that allows for a quick, stress-free experience. Not only can they move your items from one house to another, but they often provide additional services like boxing up your items and even unpacking them in your new place so you don’t have to lift a finger.
As a general rule, you shouldn’t skip tipping movers. They work in the service industry and should receive a tip based on overall service, similar to restaurant workers. Building a tipping budget into your moving expenses can help you show appreciation for the service provided. Here’s everything you need to know about tipping movers.
How much to tip movers
We’re used to tipping between 15 and 25 percent at restaurants, but tipping your waiter is different than tipping movers. Moving companies don’t operate the same way as restaurants and workers don’t rely mostly on their tips to make money. Movers are usually paid by the hour already, making tipping a nice gesture, though not required. However, they’re also working in the service industry like restaurant workers, and it’s generally acknowledged that you should tip service industry workers.
A good rule to keep in mind for general reference is $5 per mover per hour. Or, if you want to use the total moving cost, you can tip between 5 to 10 percent of the total bill for the entire team of movers to split.
Things to consider when tipping movers
Various factors will affect how much to tip movers. Not every move is equal and, therefore, tipping will vary. A half-day move is a lot less work than a two- or three-day ordeal. Here are a few factors that can help you decide how much to tip movers.
How many professional movers are working with you
If there are only a couple of movers that come to help you move an entire house, that means they’ll each be doing a lot of heavy lifting. On the other hand, if you’ve got a big professional moving team with lots of movers to help out, it’s likely their individual workload will be a little lighter and less strenuous.
If you’re looking at it from an individual view, it would be more appropriate to tip the smaller group of movers each a little more than if there’s a large group. You may even want to decide upfront that you’ll tip a certain percentage for the entire move, then divide that amount by the number of movers.
If the movers pack boxes for you
You might hire a professional moving company to do everything for you from beginning to end, including packing all of your things into boxes. This is a time-consuming and strategic process since it requires good organization and additional time to wrap fragile items, place them into boxes in a way that won’t break them and get boxes labeled so they’re easy to unpack.
If movers are packing boxes for you, it’s best to tip them for the extra work! Keep in mind that if you’re moving far away, there are possibly separate crews for packing your belongings into boxes and loading and unloading the truck. You’ll want to check with the moving company to make sure you’re tipping each crew accordingly.
Large or heavy objects
Movers that take care of really big or heavy items have a risky job — they’re careful and strong to make sure they don’t do any damage to the items or to the home as they move things in and out.
When you’re tipping a crew that moves large, heavy furniture, remember that they have a stressful and important task. If they do it well, it will save you from paying for a new item or repairing your home. After all, if piano movers drop a grand piano on the floor, it’s going to do some damage all around. But, a good mover will ensure that doesn’t happen and you can show your gratitude for a job well-done with a tip amount that reflects your gratitude.
Size and number of boxes
No matter how many or how few boxes and belongings you’re planning on moving, it’s going to take at least a few trips in and out of the house to get it all. However, the size and number of boxes can make a difference. Lots of big boxes might seem like it will be quicker and you can take fewer trips in and out to get them loaded. But, if they’re too bulky or heavy, it will take longer to move them as they might require moving slowly or more than one person to lift them.
Opposite that scenario, you might have a lot of little boxes to avoid things being too heavy, and lots of boxes mean lots of trips, even if they’re small and you take a few at a time. You need to find the sweet spot between the size of boxes and the weight of the objects they hold to ensure the movers are efficient.
Distance of the move
A quick local move is very different from a cross-country move. Usually, local moves will take much less time than a long-distance move. And, you’ll likely have the same crew helping you load your stuff from your old place and unload at your new home.
But, if you’re moving across the country, there’s a good chance you’ll work with multiple crews. One crew might pack your items into boxes, another will load your stuff into the truck. A separate crew may transport your items, with a different crew unloading the truck when you reach your destination. That’s a lot of long-distance movers and a lot of time spent helping you. Make sure you factor that in when deciding how much to tip movers.
Length of the move
You can typically expect long-distance moves to take more time. But, there are cases when shorter distances actually take more time. This is dependent on the number of items or boxes you’re moving or if you end up waiting around for one reason or another.
Being unorganized as a customer and not planning anything out can end up taking longer, especially if you have a partner or roommate that you’re moving with. If you constantly have to ask your partner or roommate where something is going and then relaying that information to the movers, it’s going to take a long time to get things settled.
And, if you do end up waiting around at any point, don’t assume you shouldn’t tip your movers for that time — although they may do much, they’re still spending their time there and it keeps them from working on other potential moving jobs that they could make money from. Be considerate of not just the effort, but the total time movers spend helping with your move. They don’t want to stand around for a half day just as much as you don’t.
The overall difficulty of the move
There are other elements to think about when considering how much to tip movers. Keep in mind the difficulty involved for your entire move when you tip movers. The number of rooms, size of the house, flights of stairs and even the weather conditions.
Going up and down multiple flights of stairs in hot weather is not ideal. Even the most hardworking movers will have difficulty with it. Movers expect to deal with some hard scenarios on moving day. But, getting a good tip for extra hard work and great service is greatly appreciated.
How to tip movers
The method of tipping will depend on what you have on hand and the movers. Tipping etiquette is very casual and flexible. Whether you carry cash or keep it electronic, there’s a way for you to tip movers.
Cash tip
Cash tips are almost always the easiest way to make sure the people actually helping with your move get the exact amount you want. When you’re handing the money directly to each crew member, you’re guaranteed that they’re getting the appropriate amount.
Credit card tip
Many companies will allow you to add a tip when you pay for your move with a credit card. Most moving companies will pass the tip along to each moving crew member in some way. But, it also might mean that the company takes a shared percentage.
Cash apps
As we continually move away from cash in our society, cash apps work just as well! You’ll need to see if the movers have accounts on the cash apps you use so you can tip directly. But, most people use the same cash apps, so it’s probably not too big of a barrier.
Contact the moving company
If your move went well, but you pre-paid or forgot to tip your movers, you can contact the moving company. They’ll give you the best option for tipping. And, they should have a record of which crew members moved you so you can ensure the right people are getting a tip from you.
Food
It’s not quite the same as giving money, but most movers appreciate any food you provide! You can provide food as an extra “thank you,” though you should give it in addition to a monetary tip. You can offer smaller snacks and sports drinks. Or, if you’re ready to really good the extra mile, hold a crew lunch and give a meal like pizza or another takeout.
When to tip movers
The best time to tip movers can depend on a few factors. There’s not one “most appropriate” time to tip movers. You’ll have to decide when is the best time for you to tip your movers.
Before you move
If you want to make sure your moving crew does a great job, you can give a tip upfront to motivate the moving team. However, they might provide poor service and you may feel like you gave a larger tip than necessary. Or, they might have done better than you expected and you feel you haven’t tipped enough.
During the move
Especially if your move is long and far and you know you’ll be working with multiple teams, you can opt to tip long-distance movers throughout the process. You’re showing appreciation for the work that’s already been done. And, you’re giving a little extra motivation for the movers to keep doing good work.
You’re also making sure that you tip the right people for the time they work. Some might only work for a few hours, while others are there the entire day. You don’t want to miss the chance to tip if someone leaves earlier than anticipated.
After the move
Tipping after the move is a safe bet because you’ve seen the work from beginning to end. You can gauge how well every part of the process went and tip accordingly.
Tipping is appreciated for a job well done
Tipping isn’t mandatory in the moving industry. But it’s a nice gesture to acknowledge that the moving company did an exceptional job and that you’re grateful for their work. After all, moving is strenuous. And, moving crews a nervous as they handle belongings that aren’t theirs and do a lot of heavy lifting. It’s nice to give them some extra appreciation for helping you through the moving process.
Welcome to NerdWallet’s Smart Money podcast, where we answer your real-world money questions. In this episode:
Feel less awkward about tipping with our Nerds’ tipping tips. Then learn about credit cards with high annual fees.
This Week in Your Money: Sean Pyles and Liz Weston discuss when to tip, when not to tip and how much you should tip — not just in restaurants, but also in places where people haven’t historically tipped, like grocery stores and self-serve frozen yogurt places. They also talk about the broader economic implications of tipping and different tipping standards around the world.
Today’s Money Question: Erin Hurd joins Sean Pyles and Sara Rathner to discuss credit cards with high annual fees: why are they so expensive, what benefits do they offer, and how can you make sure you’re not leaving money on the table if you use them? They talk about what to consider if you’re thinking about getting one, how to get the most out of your rewards points and understanding when it might be time for a product change.
Check out this episode on your favorite podcast platform, including:
More on tipping and credit card annual fees on NerdWallet:
Episode transcript
Liz Weston: Have we reached the tipping point when it comes to tipping service workers?
Sean Pyles: I think that I have. It seems like every restaurant, cafe and dry cleaner is asking you to tip nowadays. So in this episode, we’re talking about tipping. When to tip, when not to tip and how much you should be forking over.
Liz Weston: Welcome to NerdWallet’s Smart Money podcast, where you send us your money questions and we answer them with the help of our genius Nerds. I’m Liz Weston.
Sean Pyles: And I’m Sean Pyles. Listener, we know you’ve got money questions, and you know that we Nerds are here to help you answer them. So shoot your questions our way.
Liz Weston: You can leave us a voicemail or text us on the Nerd hotline at 901-730-6373. That’s 901-730-NERD. You can also email us, [email protected]
Sean Pyles: In this episode, I’m joined by our co-host, Sara Rathner, to answer a listener’s question about how to make credit cards with high annual fees worth the money. But first, it is tip time. Liz and I are going to discuss our philosophies around tipping and give you some tips for tipping. I’m going to drive this thing into the ground.
Liz Weston: You already have. That’s fine. OK. So let me preface this by saying that I worked in restaurants back in the day, and I know that tipping waitstaff is so important. Depending on where you live, your servers could be making as little as $2.13 an hour, so they need tips to make any kind of a living wage. Bottom line, do not stiff the waitstaff. But I am getting cranky about all the other places that I’m being asked to tip, like for takeout. Why am I being asked to tip 20% when all you had to do was put food in the bag? And Sean, why is there a tip jar at a self-serve frozen yogurt place?
Sean Pyles: Yeah, it can be really awkward, especially if you’re being asked to tip for things that you really didn’t have to tip for historically, like self-serve frozen yogurt or going through a drive-thru. But you’re right. Tipping stations and jars and touchscreens seem to be everywhere nowadays. And we are a show about helping people make decisions with their money. And it strikes me that this is one of the most frequent decisions that we have to make. How much are you going to tip, and will you tip at all?
Liz Weston: OK, so where do you fall?
Sean Pyles: I try to be generous by default. For me, tipping 20% at restaurants is minimum. I’ll tip a dollar or two when I get a coffee. And if I have an ongoing relationship with someone like my barber, I’ll tip more. By the way, shoutout to Mike at Too Sweet Barbershop in Portland. He’s a lovely barber and a Smart Money listener. Anyway, how do you approach this, Liz?
Liz Weston: Well, I complain, but I’m pretty much a sucker. I will stick a buck or two in most tip jars if for no other reason than gratitude that I no longer have to work for tips. But you gotta wonder, when does this stop?
Sean Pyles: Yeah, we gave the example of tipping at a drive-thru earlier, and I think that sums this up well. The bottom line is that people need tips because they are being underpaid, some may even say exploited, by their employer. Or consumers also are just used to paying a certain amount for something like a burger out, and the workers rely on tips to make the whole thing stay afloat. And I kind of buy that for some smaller businesses. Where I take issue is with larger companies with large profit margins suddenly introducing tipping, like at the grocery store, which I’ve heard stories about online. If a large company is making their employees ask for tips, I do think they should be forced to disclose just how much their CEO makes annually. So this is something that I feel really strongly about. But what are your thoughts, Liz?
Liz Weston: Well, I think if there’s a tip jar on a counter, we can use it or not. And you gave the example of the grocery stores. My very first job was bagging in a grocery store and you were …
Sean Pyles: Same.
Liz Weston: Oh, really?
Sean Pyles: Yes.
Liz Weston: I don’t know about your store, but we were forbidden to take tips, and I once had a not unpleasant but uncomfortable interaction with an older customer who just really wanted to force money on me, and I really had to say no. But the idea was that the service was included, that people shouldn’t feel pressured to tip. So I think if you are being pressured in a situation where you’re not used to tipping, you can take a moment, take a breath, maybe set a custom tip. If you’re being presented with one of those tablet screens that has the preset amounts, you usually can set a custom tip. That option is typically there, so you don’t have to use the suggested ones. But again, do not stiff your waiter.
Sean Pyles: No. And if you feel like you’re being forced to tip someone in a place that you don’t feel comfortable doing that or you didn’t typically have to tip, I think that one route you can do is maybe tip them because the employee does frankly need the money most likely. But then also think about reaching out to management and talking with them about what’s going on. It might be a little bit awkward to have that conversation, but it can help you understand exactly why they’re doing this because some companies may be doing this to inflate their bottom lines, too, and it just feels a little bit icky, and it can also feel like a lose-lose for everyone involved because being pushed into tipping can be super aggravating as a consumer. So what’s really the solution? Is it that you don’t tip the underpaid worker in protest of their employer’s practice? That really just screws over the worker.
Liz Weston: Yeah, it’s a messed-up system for sure. I really like the way that they do it in a lot of other countries because the servers earn a living wage and they get health care and paid vacations. So a tip really is just an expression of appreciation. You can leave a euro or two at most places and feel good about it. And in some countries like Japan, tipping is pretty much nonexistent. I’ve heard it said that tipping in Japan is considered rude, which is not quite the case. Somebody else framed it as it’s just seen as weird. Why would you do that?
Sean Pyles: Yeah, we look at other countries and we see things like living wages, health care, paid vacations. It’s incredible. Makes me jealous a little bit. But also, listener, because we’re NerdWallet, we of course have an article about how much to tip for just about everything. The article also includes a handy tip calculator that will do the math for you. We’ll have a link to it in this episode’s show notes post. You can find that at nerdwallet.com/podcast.
Liz Weston: And here’s a few examples from the article. For beauticians, hairdressers, people doing your hair and nails, tipping between 10% and 15% is common. I’d say where I am in LA, 20% is probably more the norm. For hotel housekeeping, $4 or $5 a night, that’s a really good goal. If you stay in a hotel for five days, leaving a twenty [dollar bill] on the dresser should be fine. And for rideshare drivers, again, aim to tip between 15% and 20%.
Sean Pyles: And if you do find yourself feeling a little bit stressed out or overwhelmed about whether you’re supposed to tip and how much you’re supposed to tip, my bottom line is just try to bring some patience, grace and generosity to the interaction. The person on the receiving end of that tip will very likely appreciate it.
Liz Weston: OK, well, let’s get on to this episode’s money question.
Sean Pyles: This episode’s money question comes from Sue, who sent us an email. Here it is:
“I have a credit card with a high annual fee. The annual fee is now due, but we don’t really use it enough to warrant this great fee. We have about 300,000 rewards points in the account. My husband just got an offer for a card from the same company which offers a 125,000 reward points incentive. Would we be better off putting my card into a no- or low-fee card from this company and opening my husband’s card with this new offer? Can we then use the points from both cards for travel or do you have another suggestion?”
Sara Rathner: To help us answer Sue’s question, on this episode of the podcast we’re joined by credit cards Nerd Erin Hurd. Welcome back to Smart Money, Erin.
Erin Hurd: Hey, thanks so much for having me, Sara and Sean.
Sean Pyles: Erin, it’s great to talk with you. Before we get into the specifics of Sue’s question, one quick disclaimer. First, everything we’re going to discuss is just for general educational purposes and is not advice around how you should use your cards, regardless of how expensive their annual fees are. OK, with all that out of the way, let’s start by breaking down what’s going on with credit cards that have these hugely expensive annual fees. Why are they so expensive, and what do you get for it?
Erin Hurd: Yeah, they are really expensive. There’s a growing number of credit cards with these triple-digit annual fees, which to some people is almost unbelievable. I know it seems crazy to pay such a high fee to carry these cards, but the upside is that these cards come with a ton of perks, and they really can actually outweigh the annual fee if you can use all the benefits that come with them.
Sean Pyles: It’s a big caveat.
Erin Hurd: It’s a big caveat. Sometimes you really have to work for the value from these cards. But really, when you look at everything you get for that fee every year, it can start to make sense for some people, especially travelers in this case.
Sara Rathner: So the listener was mentioning that they don’t think they use the card enough to make that annual fee worth it. And you did mention that these are especially helpful benefits for frequent travelers. So how can people get the most out of an annual fee of that size? If you don’t travel much, should you just look for another card?
Erin Hurd: Yeah. So one quick thing I do want to point out here is that they were saying that they don’t use the card enough to justify the fee. And I just wanted to point out that actually using the card and utilizing its benefits are two different things. So even if you’re not using the card for everyday purchases, maybe it just kind of sits in your wallet and you use it periodically, it can still be worth carrying because of all the perks that come with it. So I just wanted to point out those differences there.
So, Sara, back to your question about how people can get the most from their annual fee. Well, the first step is you really need to know and understand all of the benefits and perks that come with those cards. And the key point is knowing what is current on the card because credit card benefits really can come and go over time. They can change. Usually, it’s bad news when they change, but sometimes it’s actually good news and perks are added and maybe you’re just not aware. So I really suggest on a semi-frequent cadence just taking a glance at the perks that come with your card and make sure you understand them all and the terms of those perks and to make sure that you’re using them.
Sean Pyles: Well, Erin, I would love to hear how you do this because it’s no secret that you’re a huge credit card nerd. So how do you track the perks that you get from your various cards with annual fees to make sure that you are getting your money’s worth?
Erin Hurd: Yeah, well, I wish I had a more exciting solution for you. I like to use an old-fashioned spreadsheet personally to keep track of all of my cards and their perks. It’s just an easy way to make neat columns and to understand right in front of you the perks. And then I kind of mark off when I’ve used them. So you really have to look at some of the cards on a monthly basis. And again, just really understand the terms of the benefits that come with the cards.
Sara Rathner: And some of those monthly credits, at least in this case, the monthly credits, you can’t bank them. So if you didn’t use the $15 last month, you don’t have $30 the next month to spend too, right?
Erin Hurd: That’s right.
Sean Pyles: OK. And so do you just list out all of the various benefits and maybe you say, “OK, it’s May. I used my Uber credit this month,” just to make sure you are using it? Is that kind of how you do it?
Erin Hurd: Yep, exactly. I just put a nice X right there in that box when I’ve used the credit, and then I look, open it again next month.
Sara Rathner: Yeah, that’s really helpful because at the end of your first year holding a card, you can look back and really see in black and white, did I meaningfully offset the cost of this card through my normal life activities, or is it actually not worth paying this annual fee? And suddenly you have all this data available to you to help make your decision.
Sean Pyles: And if you find that the card isn’t worth it, you can do what’s called a product change, where you can go from a card that has an annual fee to one that potentially has a lower fee or no annual fee. And this is something that our listener, Sue, is interested in doing. This can be a really great way to minimize the amount you are paying in annual fees, but I’m wondering about the points that you already have built up. So for example, would Sue, our listener, lose the points that they have if they do a product change to a different card?
Erin Hurd: Yeah, it’s a great question. It’s a great idea that Sue brought up with the product change. It is a really great option that a lot of people don’t know that they have when they’re deciding at the end of the year if their credit card is worth it or not. And the rules of the product changes really vary by card issuer. In most cases, you’ll have to stay within the same “family” of cards if you want to change that card, but it’s really important to remember that this all varies by credit card issuer. So if you’re looking to cancel or product change a card, you really want to understand what the options are and what the rules are in terms of keeping your points.
Sara Rathner: What about a situation where somebody just plain old doesn’t want to pay an annual fee anymore? They don’t want to do a product change to a card that potentially also has an annual fee for whatever reason. Maybe in the future down the line when Sue has redeemed all of her rewards points, so she doesn’t really want to keep a card open for the purposes of keeping her points active. Let’s talk about canceling your credit card. What are some things to think about before you decide whether or not to do that?
Erin Hurd: Well, the first thing that I would recommend is contacting the issuer and letting them know that you’re thinking about canceling and seeing if they give you any retention offers. Oftentimes, especially with these really high annual fee cards, they really want to keep you around as a customer. And so they’re willing to give you extra bonus points or some money towards a statement credit to help cover part of the annual fee. First, I would really recommend someone just inquiring about any retention offers that might be available.
So then if the person decides they really do want to go ahead and cancel, that’s simple, just call to cancel. But before we do that, we really want to make sure that we’re going to understand the potential impact to the credit score. If it has a substantial credit line and that credit line goes away, that plays into your credit utilization. So that could also affect your score. So those are just some things to be aware of before you pull the trigger and actually say, “Yes, I want to cancel.” But on the pro side, it’s simplified finances. That’s one less credit card to keep track of, everything will be in one place, and it’s one less annual fee to pay.
Sara Rathner: Well, Sue also has an interesting idea for getting her husband a bunch of rewards points with a sign-up bonus of their own, and it seems like they want to use those points in conjunction with the points they’ve already built up to book some travel. So if Sue’s husband gets a sign-up bonus on their own card, would they be able to combine them with the 300,000 points that Sue’s already built up, maybe if they’re authorized users on each other’s accounts, or would they have to book travel through their own accounts’ rewards portals?
Erin Hurd: Yeah, I love the way that she’s thinking. I love always kind of scheming and plotting on how we can get more points and get the most from our points. So the answer is that it depends. There’s a lot of nuances to this. And again, it really comes down to the rules by the issuer of the card. They each have different rules.
Sara Rathner: All right, Sue, you pay for the flights and then your husband gets the card, earns the points and pays for the hotels.
Erin Hurd: Exactly.
Sara Rathner: Sounds pretty good to me.
Sean Pyles: If a little bit complicated to maneuver.
Sara Rathner: Yeah, it can be. This is something that Erin, I know you and your husband do this all the time. It’s something my husband and I do as well. It’s a way to sort of double the bonus in some ways.
Sean Pyles: So, Erin, our listener, Sue, is clearly interested in some creative ways to minimize the expense of annual fees while still getting sweet rewards perks. Do you have any other suggestions for them?
Erin Hurd: Yeah, well, I really loved her train of thought there. Product changing when you’re not getting enough ongoing value from your card is a really great solution. And that’s the first thing that I would think of. So again, just to reiterate, if you’re thinking about the product change, just make sure you’re taking advantage of all those perks that come with the card that you currently have before you downgrade. I do have one other idea for her, and that is to strategize the timing of your initial credit card application.
Let’s say there’s a new card that you’re eyeing and it gives lots of benefits on an annual calendar basis. So you could apply for that card towards the end of the calendar year and you could utilize those perks for that calendar year. And then when the calendar changes to the next year, you would start fresh with those perks and you could utilize them all over again. So that way when your annual fee comes due, you’ve now used those benefits twice instead of once. And then at that point, you can evaluate whether you want to keep the card long term.
Sara Rathner: Yeah, this is absolutely something that I’ve done before. So let’s say a card comes with a $200 or $300 annual statement credit for travel, and you have travel planned at the end of the year, use that credit before New Year’s and then use it again in January to book travel for later in the year. And you’ve just gotten $400 to $600 in value out of the card right off the bat, and you’ve only paid one annual fee.
Erin Hurd: Right, exactly. I love it.
Sara Rathner: Until credit card issuers decide to put some sort of limitation on this, it’s a great tactic.
Sean Pyles: That is a good point that the terms and conditions and rewards are ever-changing. So when you are looking to maximize your points, make sure that you are up to date on what’s happening with your specific card.
Sara Rathner: Yeah, and one thing, pay attention to your emails. If you are a cardholder, you’re going to get emails that will mention to you if there are pretty major changes to terms and conditions of your card. And I know that it’s so easy to just delete these emails without reading, but they are great sources of information.
All right, Erin, well thank you so much for joining us today. Is there anything else that Sue or anybody else weighing this kind of decision should keep in mind as they shop around and consider their options?
Erin Hurd: I think my biggest tip is just to not leave money on the table. And so know the perks of your cards, use them, know the terms of them, and then after you’ve used up all the benefits, then decide if the card is worth keeping in the long run.
Sean Pyles: All right. Well, Erin, thank you so much for joining us.
Erin Hurd: Thank you.
Sean Pyles: And with that, let’s get on to our takeaway tips. Sara, will you please start us off?
Sara Rathner: Sure. First one, get your money’s worth. Understand the benefits of cards with annual fees and make sure you actually use them.
Sean Pyles: Next up, know your options. You might be able to switch to a card that doesn’t have an annual fee, but know what would happen with any accumulated points.
Sara Rathner: Finally, adjust as needed. Canceling a card is always an option. Just make sure you understand the trade-offs.
Sean Pyles: And that’s all we have for this episode. Do you have a money question of your own? Turn to the Nerds and call or text us your questions at 901-730-6373. That’s 901-730-NERD. You can also email us at [email protected] Also visit nerdwallet.com/podcast for more info on this episode. And remember to follow, rate and review us wherever you’re getting this podcast.
Sara Rathner: And here’s our brief disclaimer. We’re not financial or investment advisors. This nerdy info is provided for general educational and entertainment purposes and may not apply to your specific circumstances.
Sean Pyles: And with that said, until next time, turn to the Nerds! This episode was produced by Liz Weston and myself; Kaely Monahan mixed our audio. And a big thank-you to the folks on the NerdWallet copy desk for all their help.
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