Why Swiss Restaurants Don't Expect You To Tip

Image source: Dave Dugdale

Over the past few months I have lent my voice to a coalition of groups seeking to raise the Rhode Island minimum wage for tipped workers from $2.89 an hour to the minimum wage for all workers ($9 an hour as of January 1, 2015). Yes, you read that right: the minimum wage for a tipped worker in Rhode Island (think waiters and bartenders) is $2.89! The idea, of course, is that workers will make up the rest through tips, but imagine working in an environment where your income is almost entirely dependent on whether or not your clients choose to live you a tip. Even worse, on slow days with few customers--something over which you have no control--you might earn less than $10 for a day's work.

Now I should point out that, in theory, employers are supposed to make up the difference between the tipped minimum wage and the "regular" minimum wage if tips don't cover it. In practice, however, this rarely happens; among other issues, the difference is exceedingly difficult to calculate. Scores of interviews with waiters and other research have revealed that this law is almost always ignored.

An Easy Way to Save Money

Image credit: 401(k) 2012

Like many people, I use a variety of tools to manage my financial life: I have two checking accounts (one with Bank of America and another with Capital One 360); a savings account; two credit cards; and various municipal bonds, among other accounts. This arrangement makes sense to me for a number of reasons, but the complexity can also create challenges. For example, several months ago I decided to carefully read through my credit card statement, and noticed that for half a year the New York Times had been charging me for a subscription I'd canceled long ago.

After discovering that error—which had cost me nearly $100—I put a recurring event on my calendar to check all my bank, credit card, and other statements. Since then I have found numerous erroneous charges. What's interesting is that none of them were fraudulent; rather, they were simply cases of vendors making mistakes.

I imagine most of us know that we should read our statements every month, but given our busy lives in can be easy to forget to do so. Yet staying on top of our accounts can yield significant savings; in a sense, it's "free money."

So next time you get that credit card or bank statement, do a careful read-through. If anything looks off, call the vendor or your bank. More often that not, it's an honest mistake that can easily be fixed, but only if you notice it and do something about it! This is an important lesson for all of us, and we will certainly use it at Capital Good Fund to help our clients!

Andy is the Founder & CEO of Capital Good Fund, a social change organization dedicated to ending poverty in America. Capital Good Fund provides financial services— small personal loans as well as Financial & Health Coaching—to low-income families.

Why We Need a Rating and Review System for Nonprofit Services

Information Asymmetry
When you want to try a new restaurant, you can use a service like Google, Yelp, or Urban Spoon to read reviews, check hours and menus, and decide on a place to eat. Thanks to online rating services you’ll be able to make an informed decision about where to enjoy a nice meal.

Now imagine you are struggling to manage your debt and want to sign up for financial counseling. You Google 'financial counseling Rhode Island' and a number of options pop up: Money Management International, Rhode Island Housing, Consumer Credit Counseling Services, etc. A little more digging might direct you to Capital Good Fund, Amos House, or one of the handful of other nonprofit financial coaching organizations in the state. What you won't find, however, is what our dinner goers were seeking: ratings, reviews, and comparisons.

Poverty Is Bad For Business

Poverty and Economic Development

Image credit: Jason via Flickr

Poverty is not merely a moral issue; it is an economic problem. We cannot have a strong economy so long as over 45 million Americans live in poverty and 49 million do not get three square meals a day, every day. And we cannot have a strong economy so long as families making $20,000 per year spend $1,200 on check cashing and money orders.

When a payday lender charges 261%, every dollar the borrower spends on interest* is a dollar not spent on savings, education, clothing, and other basic needs (on a $325 payday loan, the average borrower will pay nearly $500 in interest). When a predatory auto loan results in repossession, it becomes that much harder for a family to get to work, school, or the doctor’s office; jobs are lost, children's health and futures are compromised. And when wages are stagnant, a family's ability to buy homes, cars, and furniture—to engage in spending that drives the economy—is severely curtailed.

Nonprofits: Do We Need Them?

A Cause for Celebration?

Image Credit: Cbaquiran

As Capital Good Fund nears its sixth birthday, I would like to pause for a moment and ask two uncomfortable questions: is this cause for celebration, and fundamentally, do we need nonprofits?

Some background is in order. As a nonprofit executive and donor to a multitude of other charities, I am deeply acquainted with what I like to think of as the glossy facade we erect on our annual reports, grant applications, and public communications. We change the life of every person we serve, and we do so with a minimum of cost. Ours is the business model best suited to solving the problem highlighted in our respective mission statements. Everyone involved with our organization (board members, staff, volunteers, donors, and clients) wanders the world with a perpetual smile, the result of the unequivocal good we do in the world.

The Ideal and the Real
Yikes, that sounds cynical, does it not? Relax, I may have just turned thirty, yet I remain ferociously devoted to my idealism, something so many others told my fifteen-year-old self would never happen! But the dictionary makes a clear distinction between the optimistic and the Pollyannaish, and we would be remiss to forget that.  So let's take an unvarnished look at the nonprofit sector and see what we find.

Five Tips For Job Interviews

Over the past six year's I've had occasion to interview dozens of candidates for all manner of positions: volunteers, interns, part-time and full-time employees, and independent contractors.  Given this depth of experience, I think I'm relatively qualified to give five tips for your next job interview:

When Justice Costs Less Than Injustice

Pragmatic Idealism

Image Credit: Pixshark

I suppose that in an ideal world we wouldn't care about the financial implications of injustice; doing the right thing ought to be sufficient motivation.  Of course, that's not always the case, and rather than restricting ourselves to the high road, I think it's preferable to adopt an approach I like to call Pragmatic Idealism (PI).  The PI mentality says that, on the whole, people want to do good, but in reality a lot of factors can get in the way: inertia, politics, financial concerns, entrenched interests, and the like.  The best way forward, therefore, is to chip away at those barriers while continuing to appeal to the public's sense of right and wrong.

Take homelessness, for example.  One would be hard-pressed to find people in support of the disadvantaged living on the street, but at the same time it can be equally hard to garner support for programs that have a cost.  Put another way, how many of us would vote for tax increases so as to fund proven, effective models for putting the homeless into permanent, safe, and affordable housing?