How to Determine Your Nanny or Babysitter's End of Year Tip

Mom leaving baby with nanny

After bringing a new little one into the world, the one thing parents want most is to be able to provide that bundle of joy with everything they need to thrive and grow. While some parents may choose to stay at home and take care of their babies, many others will need to continue working to support their families. And for those millions of parents, childcare is crucial.

Childcare comes in many forms. Some parents have friends or relatives that are able to help out, others take their children to daycare, and others still hire a nanny or babysitter to come to their home and watch their kids. For families in this last group, it’s not uncommon to develop a strong and intimate relationship with the nanny or babysitter, the importance of which can be difficult to truly express. But one way to do so is through the end-of-the-year tip.

That being said, there is a degree of confusion and uncertainty when parents asked themselves, "How much should I tip my nanny at the end of the year?" While there are plenty of services and agencies that provide professional, experienced nannies and babysitters, some are hired on a more informal basis in which the terms of giving such a tip are not as clear.

We spoke with professionals in the field as well as parents who work with nannies to get the low-down on tipping. Here's how to use an end-of-the-year tip to show your children’s caregivers that you care about them, too.  

Why It's Important to Tip Your Nanny or Babysitter

When it comes to why you should give your nanny or babysitter something extra before the new year, the first reason may seem obvious. “The job of a babysitter comes with a big responsibility," says Marla, a mom from New York City. "We wanted her to know how important she was to us."

As the person you trust to care for your children, you want your nanny or babysitter to know that they are appreciated and valued—not only to foster a stronger relationship but also to ensure that they are committed to caring for your little ones.

The second reason is a simple one: If you hire a professional nanny or babysitter through an agency or a service, an end-of-the-year tip is expected. “It is industry standard for parents to provide their nanny with a year-end or holiday bonus,” says Michelle LaRowe, Executive Director of Morningside Nannies, a nanny agency in Houston, TX. “For nannies, bonuses do matter, as they indicate the nanny has met or exceeded expectations and they show appreciation for the commitment and investment the nanny has made to the family throughout the year.”

While tipping your nanny or babysitter at the end of the year only yields benefits, not doing so could be detrimental to the working relationship. “Nothing good comes from not giving your nanny a year-end bonus,” LaRowe says. “From hurt feelings to feeling unappreciated and undervalued, when it comes to holiday giving, your nanny is someone you don’t want to leave out.”

How Much You Should Tip Your Nanny or Babysitter?

When determining how much to tip there is not necessarily a one-size-fits-all approach, since the nanny-family relationship may vary slightly in every household. “Traditionally speaking, nannies receive a holiday bonus equivalent to one to two weeks’ wages,” explains LaRowe. “But things like experience, how long a nanny has been with the family, geographical location, and what a family can truly afford can influence how much a bonus is.”

In Marla’s case, she based things off of what other families gave who were in a similar situation, children-wise, geographically, and financially. “We gave an extra week’s pay, as well as a paid week off," she says.

Your nanny or babysitter’s personal life or situation may also come into play. “Our nanny was young, a recent college grad and sort of in-between university and figuring out what she wanted to do with her life,” shares Anna Baxter, from Vancouver, BC. “Our situation was mutually beneficial; we were interested in flexible, part-time help from a young, organized, smart woman who could drive and take full responsibility for the kids when she was on duty. And she was looking for a flexible way to earn as she decided her next step.”

So when the end of the year rolled around, Baxter would tip to show her appreciation and typically threw in something extra as well. “We gave her an extra week’s salary, plus a nice gift," she explains. "One year, it was a manicure and pedicure for her and a friend, another it was hip placements and napkins for eight to kit out her apartment.”

If your nanny has been with you for less than a year come December, LaRowe recommends calculating one day’s pay for each month of employment to give as a bonus. “The amount you give typically increases the longer a nanny has been with a family,” she adds. “Long-term nannies may receive as much as equivalent to one month’s wages.”

Making the Tip Official

If you do have a more informal relationship with your nanny, as Baxter did, you may determine your end-of-year tip when the time comes. But if not, LaRowe encourages families to think about it ahead of time. “Many nanny employers factor this into their childcare budget and include reference to an annual bonus in their written work agreement with their nanny,” she says.

Doing so will also be extremely helpful for both you and your nanny or babysitter come tax time. “Many parents and nannies are not aware that the annual bonus counts as taxable income,” explains LaRowe, which means both you as the employer and your nanny as the recipient will need to pay taxes on it.

In the end, your nanny or babysitter is responsible for one of the most important parts of your life and you want them to know that this is a big deal. If you do, he or she may be part of your family for years to come. “Our nanny was so wonderful and with us for about five years,” shares Baxter. “The kids still text her!”

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