Can I Afford a Nanny

Can I Afford a Nanny?

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National Nanny Recognition Week is September 18-24, 2022. In honor of this week, we’re discussing the ins and outs of fairly compensating a nanny. When considering childcare options, many parents know that a private nanny is their top choice but wonder Can I afford a nanny? In this post, we’ll be discussing the true costs of hiring a nanny to help you make the decision. 

Guaranteed Hours

The first step in deciding whether to hire a nanny is to figure out how many hours per week of childcare you need. How many hours per day and days per week? How long will you need childcare – for a few months in between daycare openings, or as a renewable yearly contract? Some parents work opposite schedules or part-time so don’t need full time care. Others need a full 40 hours per week or more, to account for commute time and other responsibilities. 

Some nannies are happy to work part-time, while many need dependable full-time hours. It’s absolutely essential that you are up front about the hours your family needs with your nanny. If your childcare needs vary greatly week to week, it’s important that you still offer your nanny guaranteed hours. It’s not okay to say, “Actually we don’t need you full time this week,” and dock your nanny’s pay. 

Whether you need 15 hours or 55, honesty is key. Ask your potential nanny how many hours per week she is looking for. Is it in alignment with what you need? Is she open to working additional hours on an as-needed basis, with advance notice? When calculating if a nanny is within your budget, make sure to include set guaranteed hours. Factor in any additional estimated hours only if your nanny is available for occasional extra work. 

Competitive Pay 

At the playground, you might overhear a cringe-worthy conversation from parents bragging about how “cheap” their nanny is. This is definitely nothing to brag about. Experienced, skilled nannies require competitive pay. If you can afford a nanny only if you pay her minimum wage, you cannot afford a nanny. You want your nanny to feel well-compensated for her hard work, right? Nannies who know they’re truly valued are able to give their all to their job. Nannies who are underpaid and/or overworked have to battle exhaustion, financial stress, and feeling unappreciated. 

To determine a fair competitive wage, search “nanny hourly rate your city” to get an initial idea. Consider your nanny’s education, experience, and any additional trainings. Many professional nannies have many years of experience and have invested a great deal of time, money, and energy into trainings. In your nanny job ad description and at your initial interview, talk openly about your offered rate to ensure it’s a good fit. 

Paid Time Off

We all know that time off for vacation, holidays, and sick time is essential. You definitely don’t want your nanny stressing that she can’t afford to call out sick. And nannies deserve time for rest and relaxation, just like everyone else! 

Holidays should be regular paid time off or paid at a higher rate (typically doubled), if your nanny will be working. Make sure to discuss this with your nanny when negotiating your contract. Mandatory federal holidays in the US are Memorial Day, July 4th, Labor Day, Thanksgiving, Christmas Day, and January 1st. Of course, the end of the year is a good time to show your nanny how much you appreciate her with a gift and/or bonus. 

If you don’t plan on taking your nanny along on your family vacations, it’s a good idea to continue to pay her for time regardless. Nanny burnout is all too common, and paid time off is a good way to help your nanny avoid burnout. Withholding her regular pay while you go on vacation is a recipe for one stressed out nanny. 

On the other hand, if you plan on having your nanny travel with you on vacation, you need to factor this into your budget as well. Ensure that your nanny is comfortable with traveling and that you give her plenty of notice on travel dates. It’s customary to pay for all of her travel expenses like airfare, food, and a separate room. Make sure to have clear expectations of hours she will be working and when she will have time off. 

Health Insurance

Nannies need healthcare just like everyone else. While parents aren’t legally required to contribute to their full time nanny’s health insurance premium, it’s advisable to do so. There are a few different ways to go about this. 

One option is you can contribute directly to your nanny’s health insurance policy. Agree upon a monthly monetary amount that will go toward your nanny’s healthcare, and pay the insurance company directly or have your nanny print out monthly premium invoices for your records. Come tax time, this money will save both you and your nanny as it’s considered non-taxable income. 

Another option is to pay into your nanny’s ​​Individual Coverage Health Reimbursement Arrangement (ICHRA). With this option, families contribute to the nanny’s ICHRA, and the nanny submits receipts for healthcare expenses (i.e. insurance premiums, co-pays, prescriptions) for reimbursement. There is no limit to the amount a family can contribute, and this money is tax-exempt for both families and nannies. 

A third option is to set up a Qualified Small Employer Health Reimbursement Arrangement (QSEHRA). With this option, families can contribute up to $5,450 (tax-free) annually for their nanny’s health insurance premiums and qualified health expenses. Nannies must submit receipts for reimbursement. 


Nannies are truly special people. They dedicate their working lives to uplift other families, giving not just professional effort but heart and soul as well. As you can see, the answer to Can I afford a nanny? takes careful consideration. Factors include:

  • Guaranteed hours for your nanny, whether part-time, full-time, or more than full-time 
  • Competitive salary
  • Paid sick time, vacation and holidays
  • Healthcare compensation

Welcoming a nanny into your family is a huge decision! If you determine that you can fairly compensate a nanny and offer her customary benefits, the next step is to start your nanny search. We can help! At Nightingale Night Nurses we offer dynamic nanny placement services to help you find the perfect professional nanny for your family.