Here comes the bill. What’s a fair amount to tip?

The old rule of thumb used to be 15 per cent, but in many places, you are presented with the options of 20, 22 and even 25 per cent if you pay with a debit or credit card.

So, what’s the best path forward on tipping? Save with SPP took a look around to see what folks are saying on this topic.

According to Global News, tipping, like many other things, is being impacted by inflation.

“People feel like tipping is getting out of control,” Angus Reid’s David Korinski tells the broadcaster. Sixty-two per cent of Canadians surveyed by the pollster said “they’re being asked to tip more,” and “one in five reported leaving a tip of 20 per cent or more the last time they dined out,” the Global article reports.

Inflation, Korinski tells Global, is making the price of everything higher — which means you are tipping for meals and services that cost more than they used to.

“When you get the tipping machine, instead of 12, 15, and 18 per cent for the suggested tip, it now says 18, 24, and 30 per cent. I think for a lot of people, that it’s getting a little overwhelming,” Korinski tells Global.

Fifty-nine per cent of those surveyed said they’d like to see a “service included” model, where tips are not needed, but workers receive higher wages and benefits.

So how much should we tip?

According to the Wealth Awesome blog, “in days past, a 10 per cent to 15 per cent tip was considered average. Today, however, a 15 to 20 per cent tip is considered normal for most services.”

The blog recommends a tip of 25 per cent “or more” for “exceptional service,” 20 per cent for “great service,” a tip of “15 to 20 per cent for average service,” and a tip of “10 to 15 per cent for below average service.”

Over at the CBC, flaws are being noted in our nation’s “tipping culture.”

“Card payment machines have made it simple for businesses to prompt a gratuity option, even in industries where tipping previously wasn’t part of the cost or conversation. And data from Canadian trade associations show the average percentage tip for restaurant dining has gone up since the pandemic began,” the broadcaster notes.

The University of Guelph’s Professor Mike von Mossow tells CBC he is even asked to tip if he picks up a couple of cans of beer from a microbrewery.

He tells CBC this is a “double whammy” for consumers, “with more businesses asking for tips while simultaneously raising their prices.”

“You know, I’ve started to wonder if I give a particularly good lecture, should I put a jar at the front of the lecture hall at the end, and as they file out? Maybe they could drop a few bills in there for me, too. I mean, where does it stop,” he asks the CBC.

The Conversation raises questions about why we tip in the first place. Isn’t it for good service?

“This belief presumes that the server receives the tip,” the article explains. “But in most provinces, management often requires servers to share tips with kitchen staff, and sometimes with management itself,” the article continues.

Furthermore, the article explains, there could be tip-sharing (or tipout) at your favourite resto. “Your individual hard-working server may not have any appreciable benefit from your generous tip,” the article tells us.

And if we tip because we feel our server/service supplier is working hard for a low wage, what about everyone else who is working for minimum wage, the article asks.

Tipping, and how much you tip, is at the end of the day up to you.

Viewed through the lens of retirement saving, one might want to think about giving oneself a little tip now and then to boost our retirement savings. Even if you were to pay yourself first, to the order of five per cent per month, you’d see your retirement nest egg begin to grow.

The Saskatchewan Pension Plan allows you to “tip up” your retirement account in several ways. SPP can be set up as a bill in your online banking, so that you can direct dollars there that way. You can make contributions on our website via your credit card. Or, you can fill out this form and have a pre-authorized contribution deducted regularly from your bank.

It’s a good tip that your future you will greatly appreciate. Check out SPP today!

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Is inflation throwing a wrench in peoples’ retirement plans?

An article from Kelowna, B.C.’s Castanet site suggests that inflation is making older Canadians hit the pause button on their retirement plans.

The article cites a study commissioned by Bromwich+Smith and Advisorsavvy that found “54 per cent of older Canadians have put off retirement this year because of increases in the cost of living.”

Other results from the study, administered by polling firm Angus Reid, were equally eye-opening.

Four in 10 older Canadians “have delayed, or plan to delay, their retirement because they have too much debt, while 62 per cent have delayed retirement because they don’t have enough savings or investments,” the article notes.

And there are other reasons for delaying retirement, the survey found.

Twenty-six per cent said they are still supporting adult children. Twenty-three per cent “love my job too much to quit,” the article reports, with 21 per cent not wanting to retire due to the still with us (but hopefully going away) COVID-19 pandemic, Castanet reports.

Other reasons for delaying retirement including taking care of a spouse (13 per cent) or other family member (10 per cent), the article notes.

“Canadians are all feeling a bit exhausted from the last two years, between multiple waves of COVID-19 and a tattered economy,” states Laurie Campbell of Bromwich+Smith in the article. “For those close to retirement, 2022 might seem like the best year to do so. But with inflation still high and bank accounts and retirement savings being depleted, it might be wise to ask yourself, can I retire in 2022?”

Perhaps the most alarming stat in the article is this one – “63 per cent of survey respondents were worried about never being able to retire.”

Other concerns were the fear of running out of money in retirement (71 per cent), as well as the worry of having to go back to work after retirement (24 per cent).

“The results of the survey are somewhat dispiriting,” states Advisorsavvy founder Solomon Amos in the article. “There have been economic shocks throughout time, but the last couple years have tested many people, and put the importance of proper retirement planning into plain view.”

Finally, while “almost a quarter” of Canadians surveyed hope their homes will fund part of their retirement, those homes are now carrying quite a cost due to the combination of already-high home prices and rising mortgage rates. Twenty per cent of those surveyed (aged 18 to 34) are spending “50 to 74 per cent of their income on mortgage payments alone.”

If you don’t have a retirement program at work, it’s up to you to save for your retirement – and that can be difficult when the cost of everything seems to be going up. But there’s a solution.

The Saskatchewan Pension Plan is a full service defined contribution pension plan that’s open to every Canadian with registered retirement savings plan room. You can arrange to make pre-authorized contributions to SPP, perhaps coinciding with your payday, so that you are paying your future self first.

SPP will invest those savings for you in a pooled fund, professionally managed at a low cost. And if you are worried about running out of money when you retire, SPP gives you the option of receiving a lifetime monthly annuity payment from some or all of your SPP savings.

If you know you should be doing something about retirement savings, but haven’t had the time, get in touch with SPP and they will help you get going on a program tailored to your requirements.

Join the Wealthcare Revolution – follow SPP on Facebook!

A recent survey in The Wealth Professional found that nearly a third of us say they are in “bad” or “terrible” shape financially owing to the COVID-19 crisis.

And the article notes that the 60 per cent who told Angus Reid pollsters they were “in good shape” aren’t sure their finances will hold up forever if the pandemic lasts a long time.

Save with SPP had a look around to find any advice on how to do more with less as we wait out the coronavirus crisis.

At the C-Net site, tips include seeing if you can lower your auto insurance if you’re no longer driving to work. This should lower the premiums, the article says.

As well, C-Net recommends figuring out “which of your monthly subscriptions are useless right now.” Are you paying for a gym membership you can’t use, the article asks – if the gym isn’t waiving fees during the crisis, maybe it’s time for you to cancel. Ditto for commuter passes, parking fees at work, and so on – anything that can be cancelled while you’re not using it should be, the article suggests.

If you’re going to have problems with your mortgage, contact your bank to see if payments can be deferred, C-Net suggests. And, the article concludes, since you can’t go out to eat, “rattle some pots and pans” and cook at home.

The Motley Fool blog suggests that this is a perfect time to set up a budget, if you haven’t already. “Once you’ve mapped out all your expenses, the next step is to determine where you can cut back,” the article suggests. If you aren’t using something, time to drop it.

Also see if you can cut back on some of your “fixed” expenses, the Motley Fool states. Review your cable, home insurance, and cell phone rates – is there a cheaper plan for each?

This is a great time to get into coupon-clipping for groceries, the article adds, and to “look for a side gig that can earn you some cash while you’re stuck at home.” Ideas include taking paid surveys, starting a business such as tutoring, or freelance writing and editing, the Motley Fool suggests.

The How to Save Money blog tackles the problem from a different angle, and suggests donating your skills to help others in your community. And if you’re able to help others financially, the site provides a long list of worthy charities that are helping others during the crisis.

Save with SPP has talked – from a safe distance – with friends and neighbours. Many are baking their own bread; some are already gearing up for larger vegetable gardens; some are making wine and beer at home instead of lining up for it, and so on. As our late mother used to say, be sure that you are “using up” everything in the fridge – this isn’t a time to chuck the leftovers.

Retirement saving isn’t going to be the priority it usually is during this tough period. One nice feature about the Saskatchewan Pension Plan  is that you, as the member, get to decide how much you will contribute. If you’re not going to be working the same hours for a while, no problem – you can lower or even stop your SPP contributions and ramp them up when better times return.

Written by Martin Biefer
	Martin Biefer is Senior Pension Writer at Avery & Kerr Communications in Nepean, Ontario. A veteran reporter, editor and pension communicator, he’s now a freelancer. Interests include golf, line dancing and classic rock. He and his wife live with their Shelties, Duncan and Phoebe, and cat, Toobins. You can follow him on Twitter – his handle is @AveryKerr22

We talk, often at great length, about ways to save money – to squirrel a little away each month for our life after work.

And while we all seem to wish we could save more, an answer to the question “why aren’t we saving” can be found by looking at where we are spending our cash. Where, Save with SPP wants to know, are our “non-savings” going?

According to Statistics Canada data from 2016, reported on in the Slice.ca blog, Canadians spent an average of $84,489 per household in that year. That’s what they spent, remember, not what they made – most of us spend more than we earn.

The blog reports that Canadians spent the most on shelter – 19 per cent of the total. “In 2016, according to StatsCan, the average Canadian household spent $16,293, or a little over 19 per cent of their total expenditure, on their principal accommodation,” the blog reports.

Next on the list is income tax, weighing in at 18.1 per cent. “They say that the only things that are certain in life are death and taxes. In Canada, $15,310 – or 18.1 per cent – of the average household’s total expenditure went to income tax in 2016,” the blog explains.

The third biggest category is called “private transportation,” our vehicles, which cost us $10,660 per year, Slice.ca notes. The category makes up 12.6 per cent of the total.

Next biggies are food, at seven per cent ($6,176) and “household operations,” which includes phones and Internet — $4,705, or 5.5 per cent, Slice.ca reports. Rounding out the top 10 (Slice.ca actually gives the top 20) are insurance and pension contributions ($5,067, or six per cent), clothing and accessories ($3,371, or four per cent), restaurant dining ($2,608, or three per cent), healthcare ($2,574 or three per cent) and utilities ($2,460 or 2.9 per cent). Savings didn’t make the top 20.

We can’t do much about most of these categories, but some are “non-essential” and could be targeted for spending cuts. If we were to save even 10 per cent of what we spend on vehicles, phones and Internet, clothing and restaurant dining, we’d have a whopping $2,134.40 to add to our retirement savings each year. Saving five per cent would provide a $1,067.20 boost to your savings.

Global News reports that we Canucks “splurge on guilty pleasures.” Citing research from Angus Reid and Capital One, the broadcaster reports that 72 per cent of us “dine out several times a month,” 71 per cent “regularly order takeout,” and half of us buy coffee daily.

MoneySense notes that a lack of personal savings has a variety of negative impacts for Canadians. Citing research from Abacus Data, the publication notes that only 34 per cent of us could “come up with $1,000 right away without borrowing or using credit.”

Debt seems to be missing from these spending stats.

According to the Financial Post via MSM Money  the cost of paying our debts is cutting into our ability to pay other expenses.

“More than half of Canadians say they’re increasingly concerned about their ability to pay debts as disposable income shrank by a fifth since June,” the Post reports, citing data from insolvency practice MNP Ltd.

“Average monthly disposable income after paying bills and debt obligations fell $142 to $557,” the Post reports, adding that “nearly half — 48 per cent — of the 2,002 respondents to the early September poll by market research company Ipsos said they’re left with less than $200 at the end of the month.”

This is a lot of information, but a picture emerges. We’re not, as a rule, planning on saving anything each month. In fact, credit balances are getting so high that many of us can’t cover all our bills without dipping further into debt. We can understand how we might cut back on spending, but we also have to cut back on using credit, too.

We all have the power to cut back on spending and borrowing. That will not only reduce our costs, it will reduce our stress levels. Imagine a future where you have control of all your bills – it’s an achievable dream. And as you get to that desired level of financial freedom, you’ll have more and more money to put away for retirement.

If you’re looking for a place to grow those hard-earned savings, look no further than the Saskatchewan Pension Plan. Be sure to check them out today.

Written by Martin Biefer
	Martin Biefer is Senior Pension Writer at Avery & Kerr Communications in Nepean, Ontario. A veteran reporter, editor and pension communicator, he’s now a freelancer. Interests include golf, line dancing and classic rock. He and his wife live with their Shelties, Duncan and Phoebe, and cat, Toobins. You can follow him on Twitter – his handle is @AveryKerr22

A recent Angus Reid survey, reported on in The Financial Post, suggests that a surprisingly large number of us – 38 per cent – have no retirement savings at all.

That begs the question: are the 62 per cent of Canucks who are saving investing wisely? Save with SPP took a look around to find some answers.

A MoneySense article from a few years back reached the conclusion that Canadians aren’t good investors.

“A whopping 60% of the typical portfolio is being held in cash – far too much to meet most retirement needs when you factor in record-low interest rates and inflation. What’s more, nearly half of survey respondents (45 per cent) said they plan to increase their cash holdings next year. The average Canadian portfolio holds just 19 per cent in equities, seven per cent in bonds, four per cent in in property, three per cent in alternatives and the rest in other asset classes,” the article reports.

Let’s compare those numbers to the Saskatchewan Pension Plan’s current asset mix. With SPP, equities (Canadian, US, and non-North American) weigh in at 36 per cent of the portfolio. Bonds are the next largest category, at 29 per cent, and “alternatives” follow – mortgages, three per cent; real estate, 11 per cent; short-term investments, two per cent and infrastructure, one per cent. (Once you retire and collect your SPP pension, it is paid out of the Annuity Fund – a non-trading bond portfolio.)

So the self-investor is 60 per cent in cash in their retirement savings account, while the SPP’s balanced fund (typically the one chosen for the savings portion of retirement) has, perhaps, two per cent in cash/money market or other short-term investments.

Why the disparity?

“When asked why they’re sitting on so much cash, the majority cited accessibility and/or convenience while 25 per cent admitted to a fear of losing money and 10 per cent said it was because they didn’t understand their options,” the article notes. As well, the MoneySense report adds, “less than half of Canadians (44 per cent) agree with the statement `Investing is for people like me,’ and a full 51 per cent believe investing is like gambling.”

In plainer terms, those saving on their own – the majority of which MoneySense notes have never consulted a financial adviser – aren’t sure how to invest and are afraid to lose money. So they park their savings in cash.

A little personal note here. This writer, having worked in the pension industry (but not on the investment side), has decent general knowledge about investing and invests the family RRSPs on his own. Generally, we try to have an asset mix that’s 50 per cent stocks and 50 per cent bonds and balanced funds, more like a pension fund. It was a search for a good balanced fund that first connected us with SPP. What we notice is that over the decade or so that we have belonged to SPP, the SPP has always outperformed our own investment rate of return. That’s why we are gradually moving our RRSP savings over to SPP – they know more about investing and are doing a better job of it. Period, full stop.

There’s no question that it is exciting, and fun, to run your own investments. However if the money you’re in charge of is being invested for your retirement future, it might be a smart idea to get some help managing the ups and downs of the markets. A financial adviser is a good idea, and another good idea is to put some or all of your hard-earned savings in the professionally-invested, low-fee Saskatchewan Pension Plan. Check them out today.

Written by Martin Biefer
	Martin Biefer is Senior Pension Writer at Avery & Kerr Communications in Nepean, Ontario. A veteran reporter, editor and pension communicator, he’s now a freelancer. Interests include golf, line dancing and classic rock. He and his wife live with their Shelties, Duncan and Phoebe, and cat, Toobins. You can follow him on Twitter – his handle is @AveryKerr22