How to Determine the Right Salary for Your Caregiver

You've decided to hire a nanny, now it's time to get to work.

You'll need to determine what kind of person you're looking for, what her duties will be, and how much you can afford to pay her.

"One of the first things a family has to do is think about the job description - what kinds of responsibilities they're having the nanny take on -- and then based on that, develop the salary," says Carolyn Stolov, Care.com's family life expert.

"Even though you might have a limited income coming in, you have to realize this is the nanny's full time job," Stolov says. "This is what they live on."

Assessing Your Child Care Budget
The going rate varies by town, city or state, but you can use Care.com's babysitter rates calculator to get started or check with the International Nanny Association.

As parents assess their child care budget, Stolov recommends they decide what qualities in a nanny are important to them. Do they require a caregiver with a bachelor's degree in early childhood education, are they okay with a nanny who's raised children herself, or perhaps one who isn't a mom but has a lot of experience? The amount you offer should take experience into account. 

Determining Job Responsibilities
After you know who you're looking for, you should create a written job description. This will outline the child care duties, like food preparation, feeding and bathing, driving to doctor's appointments or setting up play dates. Parents should be as detailed as possible about these tasks and how often they'll need to be done.

If parents are going to ask their nanny to do some household chores, perhaps when a child is napping, consider making them related to your kids, like doing their laundry, Stolov recommends.

You should make it clear in the description that the nanny's primary responsibility is the child, and make sure to give her time to take a break, too, Stolov suggests.

"You want to think about how not to make those housekeeping responsibilities so overwhelming that you're going to have a caregiver more focused on getting those things done rather than interacting with your child," Stolov says.

When you're ready to make an offer, create a written work agreement and a list of house rules.

Work Agreement or Nanny Contract
The work agreement spells out hours, salary, how taxes will be handled, overtime, vacation and benefits.

Stolov urges parents to pay their nanny on the books, and provide two weeks of paid vacation, holiday pay, and some sick days, too. With low-cost nanny health insurance options available, she also suggests paying at least half of your provider's health insurance. And she says you should offer an annual raise that is part cost-of-living-based, part performance-based, and an annual bonus of a week's salary if you can.

"What families have to think about is, what are the things you can do to make your job attractive so your caregiver will stay with you," Stolov says. "The family needs to realize they are the employer of this person. They have to think about the job they're offering is a real job."

There may be low-cost things a family can offer their nanny instead of extra pay, like adding her to your gym membership or providing a cell phone. "There may be things important to the nanny that are not monetary," Stolov says.

Finally, the work agreement should also spell out any situational changes that would alter the pact, like if the hours or duties increased, or if a new child was coming into the home. If there are additions to the job, then a salary adjustment may be considered.

While there are multiple factors to consider when determining the salary for your caregiver like location and experience, you always want to do what's right for your family. Use Care.com's babysitter pay calculator as a baseline for the going rate in your area. From there, be honest about how much you can afford and be fair to the person taking on the job.