Inflation has yet to diminish the tipping generosity of Canadians.
Can it last? Between the rising cost of living and higher interest rates, I do wonder. But for now, let’s celebrate the fact that tipping levels in early 2022 remain well above pre-pandemic levels.
In-person tipping averaged 17.9 per cent across all businesses in the first three months of 2022, according to the technology and payments company Square. The pre-pandemic average was 16.6 per cent. Provincially, the average tip in early 2022 was 18.8 in Alberta and the Prairies, 18.1 per cent in Quebec and Ontario and 17 per cent in British Columbia.
We’re at an odd point in the pandemic where inflation is raging and yet spending levels are soaring. According to RBC Economics, aggregate spending going into the spring was 30 per cent above pre-pandemic levels. The fact that tipping has actually increased over 2019 levels suggests people remain mindful that restaurants and other service-oriented businesses had a tough time during pandemic lockdowns.
Inflation is an obvious burden on low-income households and those hit financially during the pandemic. But there’s a segment of the population that has built wealth during the pandemic through stockpiled savings, gains in stocks and rising home equity. This group seems happy to spend, and to tip generously.
Interest increases are meant to curb this appetite to spend. When that finally does happen, I’ll be watching to see what happens with tipping.
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Rob’s personal finance reading list
Best bank, credit cards, mortgages and more
The moneyGenius website’s Best of Money Awards 2022 edition is worth a look if you’re shopping for new financial products or looking to see how what you already have stacks up against the competition.
Say yes to dollar store batteries
A test by CBC’s Marketplace finds that the cheaper alkaline batteries sold at dollar stores are a very good value when compared with name brands.
How reliable are electric vehicles?
It seems logical that EVs would be less prone to mechanical issues because there are fewer moving parts to an electrical engine. However, real world experience suggests the opposite is true for some brands.
Being greedy, not thinking long term
An investing blogger writes honestly about lessons learned from his investing mistakes. Great to have discussions like this because it normalizes investing errors. We all make them. What matters is getting the big things right, like taking a long-term perspective and diversification.
Q&A follow-up
A few readers asked for a more detailed answer to a recent question about what to do if you’re unsatisfied with a financial plan you paid thousands of dollars for. Here are some additional thoughts.
Do you have a question for me? Send it my way. Sorry I can't answer every one personally. Questions and answers are edited for length and clarity.
Today’s financial tool
A list of websites where you can sell gift cards you don’t want for cash.
The Money-Free Zone
Fresh from 1967 – the peace anthem Get Together, by The Youngbloods.
Watch this
TikTok’s howtoadultschool with the rundown on using tax deductions to lower your tax bill.
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More Rob Carrick and money coverage
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Even more coverage from Rob Carrick:
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- ✔️ The housing file: The housing boom is ripping apart the financial fabric of Canada • Shut out: A well-qualified millennial home seeker throws up his hands after losing multiple bidding wars • Big city housing affordability is over – now what? • She sold her Toronto house to retire somewhere cheaper, but it didn’t work • How young adults and the whole country win with a tougher mortgage stress test for home buyers • Can’t afford your house? It’s likely not your fault
- 📈 Investing: Robo-advisers have grown out of the novelty stage. Here’s help in finding one right for you • The 2021 ETF Buyer’s Guide: Best Canadian equity funds • The 2021 Globe and Mail online brokerage ranking: Who’s best for investing ... and answering the phone • Are these the stock market returns of a lifetime? • On the cusp of retirement and wondering about an ETF that pushes the limits on aggressiveness
- 💰 Your money: The five most important numbers for checking the health of your personal finances • Today’s freakishly low mortgage rates can’t last. What will pandemic home buyers do when they rise? • There’s a cost in money, isolation and family stress when seniors choose to remain in their own private homes • Taking CPP early can cost you $100,000 and limit your long term options • Fleeing the city for the suburbs? Watch out for higher property taxes, more cars and other costs
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