Holiday Tip and Gift Guide

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PayScale - December 12, 2006

By Kristina Cowan

A Giving Frenzy: Expert Tips on Holiday Tipping

Holiday Tip and Gift Guide

Amid Manhattan's bustle and buzz of holiday shopping and spending, a young professional frets over the 20 people he needs to spend on-just in end-of-the-year tips. That's not including gifts for family and friends, and has him feeling overwhelmed.

Samantha von Sperling, owner and director of Polished Social Image Consultants, an image consulting firm based in New York, said such a scenario is not uncommon these days.

"If you are thirty-something and you add up the parking attendants in your garage and the staff in your building and your cleaning lady, your budget is going to be cleaned out, even before you've bought a sweater for your mother," von Sperling said.

Several tipping experts including von Sperling say Americans are beleaguered by the number of tips they're expected to dole out at the holidays. They suggest consumers squelch their anxiety with a one-two punch: make lists, then think creatively.

Von Sperling suggests making two lists, one for family, one for service-providers, and create budgets for both. Next, she says, abide by the lists.

"I think it's a way of managing stress. To not just shop till you drop," she said.

Leonard Green, a professor of psychology at Washington University in St. Louis who has studied the psychology of tipping, agrees lists would make holiday spending easier. But he said most people don't make lists because they're squeezed for time.

"In the short-run you're too busy, but in the long-run you're better off," Green said.

Beyond lists, there are creative ways of stretching dollars, experts say.

For instance, von Sperling suggests investigating gifts such as wine on the Internet, where you can often find discounts. Or baking, decorating and wrapping a batch of cookies.

"A $5 tip that makes someone's life easier is cheap. Do something more thoughtful, elegant and refined. Turn that $5 investment into a more glorious presentation, something that has more meaning," she said.

Consumers offered mixed reactions to the idea of creative tipping.

Danielle Musat, a music therapist who lives in Parma Heights, Ohio, said she prefers creativity.

"I'd rather have someone give me a thoughtful gift like specially made cookies or an ornament they made, rather than sticking $20 in a card," Musat said. "If I was in New York and saw my bellman every day of the week, I'd have a connection with him and would want to give him something appropriate, and something from the heart."

But Stephen McCullough, a consulting manager for a software company in Denver, sees it differently.

"It's harder to come up with a gift than cash in an affluent society. I think I would be behind cash over gifts-cookies are nice, but cash is fungible," McCullough said.

Carly Drum, managing director of Manhattan-based Drum Associates, a global executive search firm, said she supports the notion of creative tipping.

"People fortunately or unfortunately work longer hours now, so the thoughtfulness or more creative gifts have somewhat gone out the window," Drum said. "I agree wholeheartedly that if they can cut down on expenses, they should do it. But just from a time perspective, they often can't do it."

Drum said consumers can also relieve some of their tipping angst by educating themselves about who stands to gain most from tips.

"You have to be informed as to who makes their real money on tips, it's not people at Starbucks. Cab drivers make most of their money on tips," she said. "You really have to be knowledgeable about the service and understand how that individual or how that service-provider is compensated. You won't know that all the time, but you usually have a pretty good idea."

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