The $76,627 Gratuity: Young Canadians Tipping Away Their Financial Futures

Tuesday, November 15, 2016

With the holiday season now underway, the perennial tipping stories are soon to surface, advising Canadians on what is an appropriate holiday tip for their trainers, hairdressers, dog walkers, Baristas and any other service provider they may have interacted with throughout the year. While such stories are typically viewed through the lens of the person expecting the tip, the people at Lendful Financial believe it’s time to dramatically change the conversation.

The online lending platform crunched the numbers and found that the average single Canadian in their late 20’s to early 30’s spends up to an incredible $2,500 annually on tipping, or $76,627* throughout their adult lives. This at a time  when that the average wage for Canadian employees is $943 a week – or just over $49,000 a year (After-tax, a little shy of $41,000 per annum, $3,400 per month.) And with many younger Canadians un- or underemployed, the after-tax income is even greater.

“A gratuity is supposed to be a gift on top of the bill, but really what it has become is an extra tax on the service received, and one that continues to rise disproportionately to inflation,” said Alex Benjamin, co-founder and CEO of Lendful. “Tipping norms in Canada have gone from a generous 10 to 15 percent to now 18, and even 20 percent in many markets, and in the process, the custom is starting to have a substantial big impact on the financial futures of Canadians.”

To further illustrate the point, Lendful commissioned an online survey to gauge the tipping habits of Canadians. The poll found that over a quarter of respondents (26%) who earn less than $20,000 regularly tip between 15 and 20 percent. One sixth of respondents (15.5%) regularly tip 20%, regardless of income.

Men also tend to tip more than women, with 54% of male respondents regularly tipping 15%, versus 42% of women.

At the other end of the spectrum,15% of respondents tip less than 10%, while 11% admit to not tipping at all.

Benjamin is not suggesting that eliminating tipping is the answer; rather, he recommends being mindful of the amount, and being cognizant that a 20 percent tip to a service provider can contribute to significant debt over time for the customer. 

“For many, it’s not only the regular large tipping that’s setting people back, it’s also the fact that people are tipping on credit cards that they can’t pay-off each month. So it has a real compounding impact long-term too that isn’t being factored into people’s tipping mindset.”

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A week in the life of your average millennial

Meal cost
Tip 15%
Per week
Total weekly tip
Daily coffee

Lunch out

Dinners out

Friday night drinks

Weekend b/fast

Weekend dinner

Total weekly


Total daily




Over 30 years

After-tax $’s


About Lendful

Bank on a better borrowing experience with Lendful, which offers Canadians quick and easy access to loans at interest rates that can save them up to 30 per cent when refinancing. Lendful offers three- and five-year fixed-term loans to credit-worthy borrowers with a credit score of 650 and over. More importantly, we give Canadians an alternative to outdated borrowing systems that are complicated and expensive. We want to offer customers the means and the time to build their lives, not the banks’ bottom lines. For more information please visit

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