How Much Should You Tip for the Holidays?

Dec. 12 -- It's an annual question when the holidays come around: In this season of spreading joy, how do we spread the wealth?

Who should we give a holiday tip to, and how much should we spend?

For some of us, our holiday spending habits will be different this year. In a recent Index of Investor Optimism survey, nearly two-thirds of respondents said they would spend about the same amount on gifts this year as they did last year, but a quarter said they would spend less. Only 10 percent said they would spend more.

Given the impending war with Iraq, stock-market volatility and the bleak state of the economy, consumers are making their holiday gift lists, checking them twice and generally cutting them down.

Despite the tough economic times, do not forget to show your appreciation to those who provide you with services and assistance throughout the year. In this slow economy, service industries are banking on their clients.

If you are tipping with money, tips should be paid in cash, directly to the individual. A personal card is not only proper etiquette, but also ensures your gift is not lost in the holiday shuffle. Tips vary across the country, along with the cost of services, but a good rule of thumb is to base it on the cost of services.

Here are my tips on tipping.

1. Personal Care

This category is for the individuals who help with your personal grooming, such as your hairdresser, manicurist and masseuse. For frequent customers who receive consistently good service, the proper tip is equal to the cost of one visit. For example, for a $40 haircut, give a $40 holiday tip. For non-regulars, an appropriate holiday tip is double the usual 15 percent to 20 percent service tip.

2. Child-Care Providers

For full-time nannies, the "holiday bonus" should be equivalent to one or two weeks' salary. For baby sitters who come from time to time, give the equivalent of one day's earnings. Finally, for day-care providers, consider giving a nice gift or gift certificate instead of cash.