Chances are, you’ve gone out to eat in a nice restaurant before, and intend to do so again. Hopefully, when you go out, you leave the wait staff a nice tip, at least if the service is average or better. (Especially if you live in a state like Pennsylvania, which allows employers to pay less than minimum wage to wait staff and other workers who can expect to get tips in addition to their hourly wages.) But how can you calculate the tip?
If you’re in luck, the restaurant will print tip suggestions on the bottom of the page; several I visit regularly have begun to do so. You might also have a tip calculator on your phone or PDA; given the ubitquous nature of these products and the high number with these programs, you may never have to calculate a tip again.
But just in case you don’t have access to any of these tools (or simply want to refresh some of your algebra skills), there are a few methods you can use to make the calculations simpler. A few tricks I’ve used myself:
1) Multiply the Tax – Probably the easiest and most widely recommended method, you can take the amount of tax you owe, multiply by an appropriate number, and end up with an amount near the typical tip amount. Consider if you have a dinner that costs $63.54 before tax (like the meal I had with six of my friends on Saturday night). In Pennsylvania, where there’s a 6% sales tax, the tax would be:
We can multiply this amount by 3 in order to come up with a decent, albeit 18%, tip amount (note: I just use the dollars and the dimes columns for my calculations; it makes things a bit simpler and does not cut down the tip amount too much) :
The advantage of this method is that it is fairly easy, as long as you remember your multiplication tables. (Good thing you listened when your teachers told that stuff would be important in the future!) The disadvantages are that it limits you to multiples of your state’s sales tax; so in Pennsylvania, you could tip calculate 12% or 18%, but you’d have a little trouble coming up with a 15% tip. Furthermore, you have to be aware of the state sales tax in any sales you visit and adjust the multiple accordingly; in California, for example, the sales tax rate is 7.25%, so multiplying by three would yield a 21.75% tip (and make you the most popular patron in the restaurant). Other states have no sales tax at all, making this method impossible. If you want to use this method, be sure to know the sales tax rates in every state you intend to visit, and multiply accordingly.
2) One Tenth plus One Half: This is my preferred method; it can work even in places where there is no sales tax, and isn’t that much harder to compute than the method above. First, if we consider the example above, and add together the tax and the sales price, we get:
We can then slide the decimal one place to the left, giving us:
Now, of course, this is just a ten percent tip, which is low for service that is not absolutely horrible. So, we can take half of this value, (roughly $3.35, to simplify our math a bit) add it to our ten percent value, giving us:
Here, we’ve got a solid fifteen percent tip, without too much work. The pro is that the calculation isn’t too hard; just slide a decimal place, cut the value in half, and add. It’s not that hard to do quickly on the bottom of your receipt. The downside is that it is not that flexible; you can only calculate fifteen percent tips, which makes it hard if you want to tip a bit more or less. (You can multiply by two after you do the decimal shift, yielding about $13.50 (20%); however, that might be a bit high, and it’s still a bit inflexible.)
3) One Percent, Multiplied: As you can see, both of these methods, while useful, do have the limitation of being rather inflexible; you can only calculate multiples of your state’s sales tax or 15% (20% if you multiply by two). If you want to be able to more closely fine-turn your tipping, you need to take a more complex approach. Start by shifting the decimal place of your total two places to the left, to get:
$0.67 (Round to $0.70)
At this point, we can multiply by any value we want, to come up with a decent tip value. Now, because we rounded up, our tips are going to be a little more generous than the percentage would indicate. If we multiply by 15, for example, we have a total of
Which is slightly higher than the 15% we would be tipping without rounding. Another problem is that, although this method allows you to tip almost any amount, it is the hardest of any of these methods. If you don’t like math, you’re probably best sticking with one of the other methods (or making sure you have a tip calculator handy when you go out to dinner).
There you have it; three different ways to calculate your tip amount with relatively simple math. Now, next time you go out to dinner, you’ll have a few new tricks in your bag!