Teaching money skills starts at home. Let me show you a simple lesson – how to leave a tip for a waitress – that you can add to your child’s money life skills.
I just love teachable money teaching moments where teaching money skills to your child just happens naturally.
You know, the moments that pop up in everyday life that are just too ripe for the taking to impart a lesson to your child?
Though they’re normally spontaneous – like when the checkout person forgets to scan something on the bottom of your cart and you show your child what it means to be honest, or when a too-good-to-be-true offer comes on the tv and you sit down with your child + a calculator to show them that “just pay extra shipping & handling” means you’re basically paying for the second product (a product you didn’t want two of, anyway).
But, you can also plan a few of them ahead of time by thinking through some typical things your family does in a week or month, such as dining at a restaurant, and the moments that will likely pop up.
Use Your Next Restaurant Trip for Teaching Money Skills
I just love it when real life meets theory. When you can do the two together – both teach your child in advance + actually have them do it in real life – then you’ve got a winner of a lesson.
I want you to seize your next restaurant trip with your family (dine-in) for a teachable money moment: how and why to tip a waitress.
In fact, you can set it up so that your child either tips the waitress themselves, or decides on how much to tip them and uses your money to do so!
But before you do so? Let’s cover the theory part.
Restaurant Tipping Prep-work
You’ve likely got a little prep-work to do here to get your child ready to tip a waiter/waitress. Some are just conversations you can have, while others are little activities you can do to prep them for what they’ll do on your next restaurant trip.
Here are some suggested conversation topics to have ahead of time:
- How Waiters/Waitresses are Paid in the United States: Let’s outline a conversation you can have. “There are some professions in the United States where people are paid a very small wage by the company/restaurant itself, and make the majority of their pay based on their performance. These professions are normally in the service industry, where someone is serving something to someone else. A waiter/waitress makes very little money each hour. Under federal law, the minimum cash wage payment is $2.13/hour. Some states make employers pay more than this, but no employer can pay less.” (Pssst: it actually turns out that tipped wages must equal that of minimum wage, or the employer has to ante up to make up the difference…but you can keep things simple at this point).
- What is a Tip?: A tip (aka, gratuity) is an optional payment you make to an individual on top of the bill. The amount that you give can be based off of different factors, with the primary one being that you were given good service.
- Do you Tip Pre-Tax Amount, or Post-Tax?: You typically tip based on the pre-tax amount…but honestly, most people (myself included) forget this and just tip based off of the total amount at the bottom of the receipt. Could be a good conversation to have.
- Do you Tip on Pre-Discount Amount, or Post-Discount Amount?: Generally speaking, when you use a coupon at a restaurant, you should tip on the pre-discounted amount. Think about it – the server is putting in the same amount of work.
- Dine-In Vs. Takeout Tipping: What happens if you dine-in versus pick up an order of food – do you need to tip the pick-up? Tipping gets a little shady sometimes, so it’s good to answer these questions for your kids with an eye towards both common etiquette and your own values. The article above looks at this from various angles (fyi: it’s got some language in it, so don’t send your kiddo directly over!).
- How Do You Identify Good Vs. Bad Service?: Again, part of this is your judgement call, and what you value. Do you value and compensate for speedy service? If your order isn’t right, is it the waiter’s fault or do you not reflect this in the tip? Do you tip 20% regardless because of the low amount waiters are paid? Answer these questions for yourself before talking to your child about what you consider good versus bad service, and how you adjust your tip accordingly.
Here are some suggested activities to have them do ahead of time to make teaching money skills easier:
Compare the Average Waitress Hourly Earnings with Hourly Minimum Wage
To give your child some perspective plus understanding for why you tip a waiter/waitress, you might want to have them research what the federal (and maybe even your state’s) tipped wages minimum is versus what the federal minimum wage is.
To give you a reference point for a good money conversation, the federal tipped wage minimum is $2.13/hour, and the federal minimum wage is $7.25/hour.
Note: Again, I’d like to mention that employers have to actually make up the difference in tips + minimum tipped wage received so that waiters/waitresses receive the equivalent of the federal minimum wage. Whether or not you want to go into this level of detail is up to you and where your child’s at. If they’re ready to get a job of their own soon? Then this could be a good discussion to have.
Practice Calculating Tips on a Few Restaurant Bill Scenarios
Ideally, you would have a few old restaurant receipts to do this with. But no worries if you don’t! Just throw a few scenarios to your child and hand them a calculator.
Here’s three scenarios for you to tweak to make your own:
- Restaurant Experience #1: You and your friends go out to eat at your local restaurant. Everything goes pretty well, but you do notice that the waitress forgets to refill your drink order. She also accidentally gives you the wrong order from another table. The total bill is $43.14, before taxes. How much tip do you leave?
- Restaurant Experience #2: You and your family go out to eat for a nice, long, Saturday brunch. It’s a restaurant you don’t normally go to, and it’s actually more expensive than you guys usually spend. The service is very good, and the food is quite yummy! The total bill comes to $69.06 after tax, and $65.00 before tax. How much tip do you leave?
- Restaurant Experience #3: You and your family go to a restaurant, and your Mom has a $15-coupon she uses. The service and food are pretty good, and you guys all have a good time. The bill comes to $35.00 after the coupon is used. The total before the discount is $50.00. How much tip do you leave?
Game Time: Have them Tip
Now that you’ve done some prep-work to get your child ready to tip, it’s time to actually let them do it!
You can let your child in on the tipping process in a number of ways – choose what makes you most comfortable:
- Give them Full Control: Ready to give your child full control over the tipping of your next restaurant experience? Go for it! If the tip is too much or too little, it’s up to you whether or not you’ll fix it with the wait staff.
- Let them Decide How Much of Your Money will be Tipped: You can also let them do the decision-making and calculating for how much the tip is for, and then you leave the actual tip.
- Let them Pay for the Tip Out of their Pocket: You can let them know they get to leave the tip, but that they also must do so out of their own money.
Tools to Use for Calculating the Tip
I wanted to leave you with one final resource – a few different options to give your child for actually doing the tip calculation.
Your child can use one of the following:
- Good ‘old paper and pen
- Calculator on their smart phone (or yours)
- Have them download a free tip app to their smart phone (or yours)
So, what do you think – are you ready to let your child leave a tip? I’d love to hear about your experience.