Nanny vs Daycare vs Au Pair: True Annual Cost Comparator

Last updated September 28, 2026

General information, not advice: this page covers tax and employment topics in general terms. It is not tax or legal advice, and reading it does not create a CPA–client relationship. Tax and labor rules vary by state and situation — consult a qualified professional for your circumstances.

Sticker prices lie in childcare. Daycare quotes monthly tuition but not the weeks it closes; au pair programs quote a stipend but not the program fee; nannies quote an hourly wage but not the ~10% employer tax markup. Enter your numbers below for an apples-to-apples annual comparison, plus the effective cost per hour of care.

After you compare: whichever option wins, the tax code can shave thousands off the bill. Nanny and daycare costs are qualifying expenses for both the dependent care FSA (now $7,500 for 2026) and the Child and Dependent Care Tax Credit (now up to 50%). → Run the FSA vs. tax credit chooser

Nanny

Hourly wage ($)

Hours per week

Weeks per year

Add estimated employer taxes & insurance (7.65% employer FICA + FUTA + illustrative SUTA/workers' comp — 2026 figures)

Daycare

Monthly tuition ($)

Hours of care per week

Weeks closed per year (you cover backup)

Au pair

Annual program fee ($, example)

Weekly stipend ($)

Yearly extras — insurance, education, etc. ($, example)

$195.75/week is the federal minimum stipend: 45 hours × the $7.25 federal minimum wage, less the State Department's 40% room-and-board credit (22 CFR 62.31; formula described in the Department's 2023 rulemaking preamble). Some states require more than the federal floor — check your state's rules. Au pairs are limited to 45 hours/week and 10 hours/day by program rules. Program fees and extras vary by agency; defaults are examples, not quotes.

If nanny care is winning your comparison, budget it properly: the Base Case Co. Nanny True Cost Model ($29) gives you the true annual employer cost before you make an offer. → basecase.gumroad.com

The non-cost notes (read before deciding on price alone)

If nanny care is on your shortlist: get the free Nanny Offer Worksheet — a 2-page checklist covering gross-vs-net framing, PTO and holidays, overtime terms, mileage, trial periods, and FSA coordination, so your offer is complete before you make it. → Download it free

Sick coverage. Nannies get sick and take PTO — you need backup care (budget a few days a year). Daycare doesn’t close when your kid is sick; you keep the kid home, so daycare families need backup too. Au pairs live with you, which helps with mild illnesses but not theirs.
Flexibility. Nannies flex around your schedule; daycare pickup is 6:00pm sharp with late fees; au pairs max out at 45 hours/week by regulation.
Socialization. Daycare wins on peer interaction. Nannies win on one-on-one attention. Au pairs are in between.
Commitment. Au pair programs are typically a 12-month commitment with rematch options — less flexible than hiring/firing a nanny, more flexible than a daycare contract year.
Multiple kids. A nanny’s cost barely moves with a second child; daycare and au pair math changes completely. Re-run the comparator per child.