Working for Tips? These Strategies Will Help You Earn Even More

Whether you’re looking for full-time income or part-time work, you might want to consider jobs that offer the chance to earn tips.

The minimum wage for tipped positions is $2.13 per hour in more than 17 states. Seven states require that employers pay tipped employees the full state minimum wage before tips. The remaining states require employers to pay tipped employees a minimum cash wage above $2.13 an hour.

But more relevant than your local minimum wage is the fact that you can consistently make good money from tips.

Not all tipped jobs are lucrative, though, so how do you choose the right job and earn the most tips?

Find the Best Jobs for Tips

Tipping is expected and common in many jobs, but clearly some will be better than others for total pay. Here’s a partial list of traditionally tipped positions:

• Waiter
• Casino dealer
• Taxi driver
• Pizza delivery driver
• Cruise steward
• Bartender
• Room service waiter
• Golf caddy
• Busboy
• Tour guide
• Hotel room cleaner
• Ski instructor

Naturally, you’ll enjoy and be more qualified for some jobs over others. Use these preferences to help narrow down that list.

Then, look for the positions where you’ll make the most money. If cleaning hotel rooms and waiting tables are both still on your list, go for the restaurant job.

Remember that to earn the most money, you should seek out employment where tips and base wages are above average.

Increase Your Base Rate

Many employers pay a base rate of minimum wage. If you’re interested in moving, you could go to a state that has a higher minimum wage for tipped employees.

For example, the minimum wage in Idaho is just $3.35 per hour, while next door in Washington it’s $12.00 per hour and in Oregon it’s  $10.75 per hour.

Of course, even in a state with a $2.13 minimum wage, some employers will pay a higher base rate. Ask about the pay before applying. Tips are usually what matter most, but making an extra $5 or $6 per hour on your base rate can help a lot.

Work at Expensive Venues

One of the most important factors affecting tips, especially in the food and beverage industry, is the size of the average bill. Customers tip according to the bill amount more than anything else.

The average tip in U.S. restaurants is now 18.1%, according to a 2018 Zagat survey. So, as a waiter, if you serve a dozen $40 tables in an evening, you’ll average nearly $87 in tips, but if the bills are $90, you’ll take in more than $195.

This is true for other tipped positions as well. Ask any bartender who has worked in both a dive bar and a high-end pub. Work for pricy places when possible.

Work in Busy Locations

Even a restaurant with expensive meals might not be a great place to work if you wait on just three tables per shift. Serving twice as many customers usually means you earn twice as much in tips. Look for busy businesses.

Pick the Right Employer

Once you decide what kind of job you want, pick which state you’ll work in, and identify some expensive, busy places, it’s time to investigate specific employers. Start by asking about the base rate, as mentioned.

Tip income varies widely by employer, even those with similar businesses and price levels. One employer might let you keep all of your tips, while another makes employees share them. For example, I once worked at a pizza place where it was policy to split large tips (over $5) with all employees. And it’s common for wait staff to “tip out” busboys and hosts with 10% or more of what they take in.

For large employers, you can often find the relevant pay information on Glassdoor. Otherwise, get friendly with employees of prospective employers so you can ask about their wages. Also check with your friends and family members who happen to work as waiters, casino dealers, bartenders and so on.

Ask how tips are handled and how much they usually amount to. Listen carefully to employees, but don’t place much importance on stories about one-time tips or memorable shifts. In fact, ask about the worst days. You might get lucky and discover a job where the worst tip days are still pretty good.

You want an average, and most employees don’t bother to calculate that accurately. But if you ask for examples from ordinary shifts and bad shifts, you can put together a relatively safe guesstimate of the tips you’ll make at a given job. Then you can calculate what you’ll make with the base rate included.

What If You Lack Experience?

If you lack experience, you won’t qualify for the best positions and may not get hired at the best places. In that case use a longer-term strategy. For example, caddy at a slow golf course as a resume builder so you can get hired at a better place.

Use a position as a busboy as a temporary stop on the way to being promoted to waiting tables. Take a job in a restaurant kitchen only if your employer says you can join the wait staff as soon as you prove yourself.

There are always opportunities to build your resume or places where you can quickly advance. For example, many bars won’t hire an inexperienced bartender, but will hire you as a bar-back.

Once you have a job where you make good tips, you can move on to part two of your plan: Implementing strategies for making even more tips.

Steve Gillman is the author of “101 Weird Ways to Make Money” and creator of EveryWayToMakeMoney.com. He’s been a repo-man, walking stick carver, search engine evaluator, house flipper, tram driver, process server, mock juror, and roulette croupier, but of more than 100 ways he has made money, writing is his favorite (so far).