Choice: Daycare vs Nanny/ baby sitter? Also: Rates & taxes?

[PMG]

We’re expecting and having trouble with the idea of sending our 6-12 week old to day care. My spouse works from home, and I will be able to work from home a day or two a week. So we are toying with the idea of juggling baby a couple days and hiring a nanny/baby sitter a couple days a week to allow us to keep baby home until they are a little older.

Our choice is essentially between full time daycare and part time in home care with us both working full time either way. I worry going this route we’re just going to spend more to have more stress! 

1.) I’d love to hear other peoples feedback on how they made this decision and the emotions and logistics!

(We recognize that we have no clue yet what life will be like.  We do know a young college aged woman who might be a good fit. We’ve reached to find out if she’s interested at all.)

2.) What are the going rates for nannying or child care in your home?  At the care giving home?  What’s the going rate for occasional baby sitting? 

I’m guessing that infant care is harder to find/more expensive?

We’re asking these questions locally too but I value this forums thoughtfulness.  We want to be fair and pay well.

3.) If we’re paying someone regularly we want to be sure we’re on the up and up whether they are an employee or a contractor. I haven’t even started researching this. Considering them a contractor and taxes being their responsibility makes sense off the top of my head, but we are conscious of those obligations when thinking about pay rate.  Will welcome advice here, though I haven’t yet discovered what my questions will be.

[mavendrill]

My answers:
1) My wife had a conventional job.  I was a college instructor - about 15 hours each week that are absolutely fixed and the rest flexible.  Most of my colleagues decided on full-day day care.  We looked at a lot of options, but decided we would rather juggle the baby.  We ended up hiring babysitters for my fixed schedule (this worked great - because I would take my kids to work, and there was a nearly endless supply of labor willing to watch my kid(s) on their breaks (I never needed more than 3 hours at a time, and generally just needed one and a half).  Additionally, I didn't have to pay for commuting and the logistics involved.  This made the childcare incredibly cheap, and the logistics were pretty straight forward.  HOWEVER, it meant that I was fitting in my other 30 hours each week squeezed in random times, especially after my kids and spouse went to bed.  It worked, but it was really hard.  I also had to give up a lot of opportunities at work to be so active as a parent.  It was what I wanted, and I am glad I did what I did, but it is very frustrating to see the amount of work you could accomplish without kids but simply cannot do anymore.

2) We almost always had care given at my work (aka a giant campus that has great weather year round).  We paid $20 each hour for one kid, $25 if older sibling had to come along.  (why would older sibling come along - because one thing that is really important to know about kids is that they get sick. A LOT.  From late fall to early spring, I plan on 25% of the time my child not meeting the preschool health guidelines (which are generally the same as the daycare).  Some of this is that I have multiple kids and that definitely makes it worse, but even with full-day childcare, you will need to be ready with lots of backup options (or become the parent who loads the kid up on tylenol and cough suppressant at 6:45 AM and take your child to daycare and then pretends to be shocked when you get called at 11:00 about your childs cough and spiking fever).

We found that at $20 per hour, we did not have trouble finding willing sitters, that they were reliable and willing to deal with sick kids, and that when they didn't want to work they would be happy to let us know.  It was a good balance that we felt was fair.  Most importantly, I never had to miss a day because of babysitters.

Edit to add: this went on from 2016 until the pandemic hit.  I don't have more recent data.

[engineerjourney]

We have five options for care that we looked into each time we had a kid (we have 6yr, 4yr, and 7m currently). 

1)   Nanny (live in or live out) – EXPENSIVE unless you go the international route through an agency and that involves a person living in your home and I’m not into that.  Also, single point of failure for care, that person is sick, you are out of luck.  Finding a reliable person was also difficult when we looked into it once we had 2 kids (economy of scale).  Some people rave about this option though.  One thing to note with your wife WFH.. my kids were ALL ABOUT MOM for like the first two years of their lives and if I was an option (like they knew I was in the house, or I came into eye view) then my kid was not good for other people until they got mom time.. and they were pretty chill kids.  So not sure how well the baby being in your house and able to hear mom will go. 
2)   Stay at home parent/leave of absence – I’m not the personality that finds reward in taking care of small humans and found my job to be waaaaay easier (and better paying) but this is a thought exercise everyone should go through I think.
3)   Flex working/opposite shifts – Didn’t give much thought to this but had to do it during the first couple months of the pandemic where my husband and I didn’t work the same shift because all childcare was closed.  Was absolutely awful and I would never do it again.  I would quit.  No downtime during the week at all (working or kid time or sleeping) and no quality time with my spouse.  Some have success at it though so worth a discussion, maybe your jobs are more flexible.
4)   In home daycare center – Cheaper than the larger centers around here, usually only allow one infant at a time so your baby will be in with older kids.  Single point of failure if provider is sick/wants a vacation.  I didn’t like the idea of my infant being in with older kids but I know some who like it, especially if a sibling is there too. 
5)   Larger daycare center – This is the option we ended up choosing and we have gone to two centers with our kids (moved).  The first provided all diapers, wipes, food, even formula if needed, was an all inclusive fee for care.  As first time parents I thought it was wonderful.  They were in classes of <8 kids of their similar age and loved it.  Our current center is even larger and more typical with rules and what they provide (you have to bring everything in).  Two classrooms for each year.  Besides for the pandemic BS we have never had any issues with being unexpectedly left without childcare and our kids have loved the school like environment and so far adjusting to public school was no biggie for our oldest. 

For costs, we live in a decently high cost place.  Its $320/week for infants and $290/week for age 3+.  The in home places were usually $20-50 cheaper a week last we looked.  One thing to note is that the daycare industry has been decimated by the pandemic.  We have less options available as homes and centers closed permanently.  So don’t wait too long to check out options if you might go that route.  Our amazing daycare has a year wait right now for most age spots…

There are services you can use to pay a nanny/babysitter on the up and up.  I can’t remember their names but they do payroll for you and make sure all the taxes and benefits and everything are right.  I was going to go this route for at least the first year if we ended up going with a nanny.  There is enough stress during the first year!
Good luck with your decision!

[Just_Me]

Nannies are generally considered household employees unless you hire them through a service like mother's helpers. If you want to do it correctly here's the guide I used to set up everything correctly for our nannies. $2300 is the annual minimum wages paid when needing to withhold for OASDI. Otherwise it's all cash wages.

Generally with day care your kids will be sick. It's usually more cost effective to have one kid in day care, two kids with a nanny for Denver. However there are pros to having them in daycare (socialization, out of the house). That's for full time care. However for part time day care you end up paying full time rates even if you only go part time unless you find a gold mine of a day care that lets you pay by the day.

If you do go the nanny route do background check and get references.

Another option for pinch hit sitters are websites like care . Com or sitter city . Com.

[CNM]

IMHO there is no good way to watch a child, particularly a child under the age of 5 years old, while working from home.  You will not be able to work because taking care of the child will take up all of your time. 

For our kids, when they were under age 2, we had a full-time in-home nanny.  Yes, they are expensive.  Yes, they are considered employees and you will need to pay payroll taxes.  You might be able to get away with classifying them as a 1099 contractor, but I would only do that if the nanny agrees and knowing that the IRS may disagree.  Our current nanny earns $20/hr plus quarterly bonus.  She will also do light housekeeping.

At age two, our kids began attending daycare/preschool.  This is much less expensive-- I want to say $1000/mo.  Our youngest now still has a day with her nanny, and the remaining days of the work week she is at preschool.  She is picked up in the afternoons by her willing grandmas (they split days) and they spoil her for a few hours until we come home from work. 

Grandmas do back up child care, nanny is happy to fill in, and the last line in case of emergency is my sister.

Yes, childcare for a young one is expensive.  But it is worth it, unless someone wants to be a full-time SAH parent.  Also, my kids have really enjoyed their nanny & daycares and, of course, love "grandma time" the most.

We are planning on moving to a different home within a year or so.  I'm thinking of looking in to an international au pair, as the new home has a somewhat separate living area.  This is because I would like my kids to be exposed to my family's native language more and, they way things are developing now that my kids are older, we could use someone to help with the afterschool & after-school sports pick up-drop off situation

[Sibley]

One of my coworkers has a 2 year old. She hasn't used daycare at all, and the kid during the week is watched by a combo of dad, grandma #1, grandma #2, an aunt, and there are a good 3-4 backups who are family or friends. And she still has child care issues once in a while. Not everyone has a large pool of friends and family willing to babysit, not everyone has a spouse who works shifts and is therefore home 2 days a week.

My other coworker has a 9/10 month old. Baby goes to grandma's (grandma has 2 fosters at home already and apparently is superwoman, able to keep up with 2 babies, a developmentally not typical toddler and a 7 year old without stress), and dad also has a day or 2 at home a week where he can provide the child care. And she still occasionally has child care issues.

Whatever you end up doing - decide soon and get it lined up. Or your first choices may not be available. And make sure you have backups of some sort.

And if it works out that a daycare center is your best or only option - it'll be ok.

[lutorm]

We had the same issue so for our first child we paid for a nanny from my wife went back to work at 6mo until he was a year when handing him off to a daycare seemed a lot more reasonable. It was expensive, we paid $20/h plus OASDI plus health and workers comp insurance (through an agency). It basically brought our savings rate to 0 for those 6 months, but for us it was a moral thing that someone we employ should have health insurance. She was great though, she had worked in early childhood education so was a bit older but more experienced than most of the candidates we interviewed, and our kid ended up loving her. Since we were only doing it for half a year it was manageable -- we were going to hire her for another 6 months when we found this awesome in-home daycare that he ended up staying at until they closed for covid.

[Indio]

@PMG
If you decide to hire someone for in home childcare, this is how I approached it. Babies and little kids sleep a lot, about 15-17 hours a day, so you should plan for child care around nap times. I was fortunate that I had remote home based job when my kids were young. I had an in-home babysitter because sending kiddo to day care meant exposure to other sick kids. If my kid got sick, I was up at night caring for a child and still had to work next day. Consecutive nights of sick kiddos, is exhausting and when one kiddo gets sick, the rest of the family usually acquires the germs too. A babysitter cost more than daycare, but not a huge amount, and it made a big difference because young kids get frequent colds since everything goes in their mouth. At home, I could control the environment with healthy food, clean toys, and someone to give them 1on1 attention. Sitter usually came in the morning. I fed kiddo lunch and put them down for afternoon nap, which usually lasted 2-3 hours. My kids were good nappers. If they woke up, they played in crib till I took them out at 4pm. I never scheduled late in the day meetings so I could have time with kiddo. Being able to have lunch together and play in late afternoon made me feel as if I wasn't completely missing their childhood.
When the oldest was 4, I sent them to preschool for the socialization and that's when the costs started to skyrocket. Getting a morning preschool slot was tricky because that is when most kids are awake and highest demand compared to afternoon time slot.

[PMG]

You have all given me (us!) much to think about.  Thank you!  I’ll process this a bit then come back with questions! 

It is so hard because it seems like you need to have a plan in place ahead of time but there are so many variables and unknowns until the baby actually gets here and we see how life goes!

[engineerjourney]

Sounds like Indio had a great set up!!  If you have the right kid that sounds pretty freaking good in my opinion. 

But there are definitely variables.. for example all three of my kids were awful nappers.. only napping in 20 min increments and maybe for 30 if they were physically on me.  And they all (so far) dropped naps entirely at age 2.. they were good night sleepers so I guess it was fine but I definitely would not have been able to work around their napping! Just another data point :)  Kids are really good at foiling plans, haha.   I am thankful my kids have overall been healthy and haven't been taken down by too many daycare germs but some others I know got sick all the time before adjusting to the germs. 

[CNM]

You have all given me (us!) much to think about.  Thank you!  I’ll process this a bit then come back with questions! 

It is so hard because it seems like you need to have a plan in place ahead of time but there are so many variables and unknowns until the baby actually gets here and we see how life goes!

How quickly things need to be nailed down ahead of time might be location specific.  Where I live, I hired kid #1s nanny after he was born (he was an early surprise anyway!) and it took about 10 days.  I hired this nanny via an agency, so after I spoke with the agency and filled out some paperwork, they sent me 3 candidates to interview almost immediately.

Nanny #2 I hired from a friend, as the friend was moving so no longer needed a local nanny.  I *think* I spoke to her right before baby #2 was born and then again, more seriously, right after the birth to confirm everything.  Both nannies starting coming when the kids were 4 weeks old and I started easing back into work.

All this to say, you don't necessarily need to have actually made a firm decision or commitment before the child is born.  It is a good idea to price things out and have an idea about what you'd like to have happen in advance.  If there is a specific day care that you want, for example, contact them and see what the timing is and whether there is a waitlist. Where I live, I have never had to deal with a waitlist.

[Captain FIRE]

All this to say, you don't necessarily need to have actually made a firm decision or commitment before the child is born.  It is a good idea to price things out and have an idea about what you'd like to have happen in advance.  If there is a specific day care that you want, for example, contact them and see what the timing is and whether there is a waitlist. Where I live, I have never had to deal with a waitlist.

Definitely call around, as the counterpoint to the other story is my coworker who called a place and was asked if she was pregnant.  Startled she asked why people would call and register before they were pregnant and the answer was to guarantee a slot because waitlists are that bad.  Since we had a generous parental leave policy (up to 6 months), it was ok for her, but if you have a short runaway before returning to work, you might want to look sooner.  I called the place at the building at my work when I was a few months pregnant - so a year out from when I need it, and was told not only could they not guarantee me a slot, but they couldn't even tell me where I'd be on the wait list, whether say 2 or 20.

[startingout]

1. We chose a nanny because we didn't want to have to deal with drop-off and pick-up every day, plus packing all the bottles, food, and clothing needed per day. My spouse is also super scatterbrained and I'm constantly running late to everything, so I was worried we could accidentally forget the baby in the car. A nanny turned out to be a great choice for us because we don't have to worry about the baby's laundry or cleaning up toys. The baby also rarely got sick, and our nanny came even when the baby had a cold. Now that we both work from home, it's nice to be able to see our toddler throughout the workday.

2. The going rate in my area seems to be $20-23 per hour for a nanny for one baby in your home. My friend pays $21 an hour for her nanny, and I pay $22 for mine who's been with us longer. The rates for daycare for an infant range from $1,650-$2,000+ per month.

3. Legally, our nanny had to be categorized as an employee based on the amount of hours we were employing her for. We handle taxes and payroll via a service called NannyChex.

[mm1970]

Infant care is VERY hard to come by where I live.  Also, it's expensive.  My infant care was $250 a week 10 years ago. It's much higher than that now.

For both kids we used licensed home childcare.  I preferred the home environment to a day care center, even though centers were more likely to have regular hours and substitutes.  In either case, you paid for regular care whether you used it or not.

Nannies run closer to $30 an hour these days.  In California, they are an employee so you have to pay social security taxes if you go that route.

Both my husband and I worked full time, though with #2 I only worked 32 hr a week for the first year.  I still needed FT care.  The mishmash of working from home with babies, using part time nannies on various days/ hours - that seems to be pretty desired here (at least, I can see a lot of requests for this on our local FB childcare page).  I can see why, totally, but on the flipside, most nannies want as close to full time hours as they can get - because this is their full time job.

[Paper Chaser]

We've done the in-home daycare option with 3 providers now (although 1 is family). With 2 of them, they watched very few kids at a time and we've been very happy. The third was good too, but she watched 7-8 kids of various ages some days and just seemed a little overwhelmed. We would've stuck with her, but the family option presented itself.
We typically pay $200-250 for 4 days of care. We provided diapers and wipes, but food was usually provided by the sitter. We live in a LCOL area.

[Captain FIRE]

Our daycare rates will be going up 8% in September.  Too bad my salary isn't going up commensurately.