The cost of working: Nanny versus day care

sadie gladstoneWhen I got pregnant with my second child, most people assumed I would switch from a daycare situation to a nanny, given that I still have two and a half years to go before public pre-K kicks in (that is, if we get lucky to get a lotteried spot in our very kid-crowded Brooklyn neighborhood). Two kids, one nanny, it's got to be cheaper, right?

Not so, actually, although having two in daycare is no bargain either.

The moms I talked to this weekend, who are not living in New York, found this hard to believe. But even at the lowest going rate for a nanny -- $10 an hour in New York, which is nearly impossible to find for two kids -- the double daycare bill still beat the price tag for 50 hours a week, especially since we get a little break for having two in at once.

How does that compute? Because the nanny and the kids need food, for one thing, and feeding even two of them every day would add up -- with organic milk at $3.19 a half gallon in our neighborhood. Also there are taxes to consider, which up any hourly rate significantly. A lot of people pay under the table, of course, but we probably wouldn't if we went that route.

In New York, nannies also get all sorts of extras -- from paid cell phones to monthly Metrocards to spending money. They get birthday presents, tips, paid vacations and yearly raises. Some even get health insurance. I know I couldn't keep up with any of that. And the truth is that most people in Manhattan and Brooklyn are paying more like $15 an hour.

My older daughter is also of an age where she'd need some kind of classes or part-time schooling situation, so we'd have to shell out for that on top of the nanny salary. A simple 6-week YMCA swimming class is $150 in Brooklyn. Music, dance, art and gymnastics classes for the under 3-set run even more than that. A part-time preschool program for 2-year-olds, which runs about three hours in the mornings, can run anywhere from $3,000 to $6,000 for the school year.

My cousin in California is facing just this dilemma in her situation, but she has adopted an innovated approach. While her older son goes to preschool, she runs a mini-day care at her house for her daughter and a few other part-time children. Her nanny reduces the family's rate for every new child she takes on, while my cousin handles the insurance and the food costs. She's thinking of stepping it up to become a full-time facility, but she's still working out what the additional insurance and licensing costs will be.

We don't have the space for that kind of situation, but it's an interesting option if you do. The calculus makes me wonder what I'm doing sitting at work writing this blog post, rather than at home with the girls.

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