The nanny vs. daycare decision comes down to more than just price — though price matters enormously. This guide gives you the full picture.
True Cost Comparison
| Option | 1 Child | 2 Children |
|---|---|---|
| Licensed Center | $1,200/mo | $2,100/mo |
| Family Home Daycare | $900/mo | $1,550/mo |
| Full-time Nanny | $3,200/mo | $3,400/mo |
| Nanny Share (2 families) | $1,800/mo | $2,000/mo |
The crossover point: For most families, a nanny becomes cost-competitive at 2+ children, or when flexibility is critical (irregular hours, frequent sick days, travel).
When Daycare Wins
- Budget under $2,000/month for one child
- You value socialization and structured curriculum
- Subsidy eligibility — subsidies don't cover nannies
- You want licensing and inspection oversight
When a Nanny Wins
- Two or more young children
- Irregular or unpredictable work schedule
- Child with medical needs requiring 1:1 care
- Early drop-offs or late pickups (before 7am or after 6pm)
Nanny Taxes
If you pay a nanny $2,700+/year (2026 threshold), you become a household employer — responsible for Social Security, Medicare, and unemployment taxes. A payroll service like HomePay or SurePayroll simplifies this ($50–$100/month).
Yes — a Dependent Care FSA covers a nanny's wages, as long as the care is for a qualifying child under 13 and the nanny is not your spouse, dependent, or child under 19.
If you're exploring daycare options, browse 154,000+ licensed centers near you.
