Just like with most other professions, a live-in nanny’s earning potential is significantly influenced by several different factors. Job location, education and experience are all key factors that influence live-in nanny rates. Nannies who live in major metropolitan areas and those with a college education and extensive experience tend to be the highest wage earners.

Since live-in nanny salaries are up for negotiation and are determined by the parents and nanny, those who are savvy negotiators and present themselves in the best light tend to also have an earning edge. Since parents set their childcare budget, negotiation isn’t likely to make a nanny who is completely out of their budget suddenly in it, but it can bring a live-in nanny’s salary up to the higher end of the nanny’s desired salary range when negotiating with parents who are in the same general range.

According to the 2012 International Nanny Association Nanny Salary and Benefits Survey, full-time live-in nannies in the United States earn $652 gross per week. Since live-in nannies are considered non-exempt employees and are protected by the Fair Labor Standards Act, their weekly salary must be broken down into an hourly wage.

Live-in nannies are required to be paid at least minimum wage for every hour worked, and live-in nannies in some states are required to be paid overtime. Some states require live-in nannies to be paid for overtime at their standard wage rate and some require them to be paid an overtime differential. Live-in nannies and live-in nanny employers should consult a reputable nanny tax and payroll company like 4NannyTaxes.com to determine their state guidelines. 4NannyTaxes.com offers complimentary consultations to families and nannies who utilize our partner sites.

Since nannies are employees of the families for whom they work, they, along with their employers, have legal and tax obligations. Nannies and parents should clearly communicate in gross terms when discussing a nanny’s wage rate. Nanny employers can expect to pay about 10% of their live-in nanny’s gross salary in employment taxes and insurances. Fortunately, there are tax benefits for employers who are compliant, and those benefits, in the forms of tax breaks, can offset the cost of paying a live-in nanny legally.

But a live-in nanny’s salary package consists of more than just an hourly wage rate. In addition to wages, live-in nannies should consider the benefits being offered with the position. Standard live-in nanny benefits include at least two weeks paid vacation, paid sick and personal days, and partial or full contribution to the nanny’s health insurance premium. Other benefits nannies sometimes receive include contributions towards a retirement fund, paid professional development days and gym memberships.

Since live-in nannies work so intimately with the families who employ them, it’s vital that they consider more than the paycheck when choosing a position. Live-in nannies must select a family with whom they are compatible with, and there must be a personal connection for the relationship to succeed.

9 Reasons Live-In Nanny Job Rates Increase

  1. Job Duties are Added. When parents want their live-in nanny to double as a housekeeper or take on additional housekeeping or home management tasks, such as doing the family’s laundry or supervising home repair crews, it’s customary to offer an increase in the nanny’s hourly rate.
  2. A Child is Born. While nannies aren’t paid per child, if a child is born during her tenure with a family, a wage increase is warranted since her responsibilities will increase. Nannies typically receive a 5-10% raise when a new child is born.
  3. A Contract is Extended. Nannies and parents typically sign one year work agreements. Like with most other types of employees, live-in nannies receive an annual review. Nannies tend to receive a 2-3% cost of living raise and a 5-7% merit raise per year.
  4. Parents Become Tax Compliant. If a live-in nanny employer realizes that she has not been tax compliant and wishes to do so, in order to keep the live-in nanny’s net pay the same, an hourly wage increase is unavoidable.
  5. The Commitment Changes. Perhaps a live-in nanny was hired for the summer and the family now wishes to extend the seasonal arrangement into a year-round one. In this case, the live-in nanny may ask for a wage increase, especially if the job duties and responsibilities were greater than originally expected.
  6. The Nanny’s Living Status Changes. Live-in nannies typically earn $50 to $100 less per week than live-out nannies. If a nanny’s living status changes from live-in to live-out, either due to a change in the family’s residence or care needs or the nanny gets married, her hourly wage may be increased.
  7. The Nanny Relocates with the Family. Asking a nanny to relocate with a family is asking a lot, but many nannies are willing to do so with an appropriate salary increase. Since geographical area significantly impacts a nanny’s hourly wage, families who move to a major metropolitan area may end up paying more for their nanny.
  8. A Great Performance. Parents who notice that their nanny goes above and beyond and wish to reward her may offer their live-in nanny an hourly wage increase.
  9. To Entice the Nanny to Stay. If a live-in nanny is considering leaving her post due to a better offer, parents may entice their nanny to stay with their family by offering an hourly wage increase.

Fair pay is essential in securing and keeping a quality, live-in nanny. Live-in nannies and their employers should asses the live-in nanny’s role, duties and responsibilities to ensure a mutually agreeable hourly wage.