Q. How Much Does A 5 Day Per Week Nanny Cost?
A. Outside of a major city, I feel cost would typically be as follows:
Working Hours: 8am-6pm
Nannies Gross Salary: £10 Gross per hour
If you are city based, then you could easily be adding another 20%, especially if in London.
This I feel is a reasonable amount to assume for the nannies salary during 2013. The actual salary may well vary between applicants and on the level of experience you wish someone to have. Market forces have an affect and at the moment there are a lot of people looking for jobs, thus the salary level I am suggesting is a little lower than it was last year. Decide how much YOU feel you are able to pay the nanny. If you are not in a position to offer £10 Gross per hour then you can advertise at a lower rate and see who applies. You must comply with National Minimum Wage legislation… in the UK, National Minimum Wage for someone aged 21+ is currently £6.19 per hour.
If it is the nannies first job, such as moving on from working in a nursery or having left college, then you may find they will accept a lower salary. This is I feel in part due to the nurseries not paying staff that well (typically in my area a full-time nursery nurse is paid around £14,000 per year for a 40 hour week). So you may find they would accept around £7 gross per hour initially, then expect more as they gain experience of working sole charge.
The Calculations for a nanny, 5 Days a Week:
Nannies Salary: £10 Gross per hour
Number of hours per week: 50
Nannies Salary per Week: £500 Gross – £26,071 Gross per Year
Employers National Insurance: £ 2535 2013/14 tax year (calculation by MrAnchovy’s PAYE Calculator )
Nanny Payroll: You can do this yourself or you can get a lot of a assistance from a Nanny Payroll Company such as PAYEforNannies who my employer has been successfully using for many years now. The cost of having a payroll company is around £115 a year. The payroll company will produce payslips and tell you when and how much to transfer to HMRC in terms of the deductions (Employee Tax, Employee NI) as well as your Employers NI.
Weekly Expenses Kitty (for activities/outings): £5 per day, you may find the cost increases during school holidays. The more children you have the higher the activity cost may need to be – perhaps consider £2.50 per day, per child. Based on a 48 week working year, nanny working 5 days per week, £5 x 48 weeks x 5 days= £1200 total.
Nannies Travelling Costs Whilst On Duty: If your nanny uses their own car, then employers would usually reimburse the cost at £0.45 per mile (this is known as the Approved Mileage Rate). Employers can negotiate with their employee to pay less than this, though you should take into account your nannies costs of providing a car, car seats, suitable motor insurance to include transporting children for whom they care (this can be arranged through Morton Michel and other insurance brokers)
How many miles your nanny would do will vary. Consider the usual mileage they would do to take children to school and back, to get to toddler group, other outings. I would say that I do an average of 3000 miles a year (nannying 4 days per week in a semi-rural location). Start recording the mileage you do in your car during the week, you may be quite surprised how quickly the mileage adds up even if you are just going to the local shops, library, playground, woods, PYO farm etc.
For a 5 day per week nanny I suggest factoring in at least 120 miles a week… so £54 per week, £2592 per year (48 weeks).
While your nanny is on duty, you give them food and drink. Nannies don’t really get a lunch hour, can’t leave your children home alone. So food is seen as a sort of perk in compensation for working without a break. How much does that add to your weekly food budget… I’m not sure. Nanny will eat with the children, so eat the same thing. If nanny wants something different, I feel nanny should be buying that themselves. So increase in food bill, extra £3 a day maybe? Heating/Light will also be used more as nanny is around during some of the day, so another few pounds. If comparing with a childminder/nursery, lights wouldn’t be on at your home, heating may also be set low. If comparing with you staying at home, then there won’t really be much of a difference at all. There is also some additional wear and tear on the property. Shall we lump all these types of cost together… say £8 per working day. Suppose you could include cost of Employers Insurance in that (it is usually part of your home contents cover, check your policy). So 5 days x £8 = £40. 48 weeks x £40 = £1920
Total Cost of Employing a Nanny For Five Days Per Week
£26,071 gross salary, Employers NI £2535, Nanny Payroll £115, Activity Kitty £1200, Mileage £2592, Food/Drink/Heat/Light/Misc. £1920
Grand Total: £34,433
The total cost of employing a nanny for 5 days a week will vary depending on your situation. I hope the calculations above help you consider many of the costs involved.