The Manifesto Episode 29: Childcare, Au Pairs and more with xgerman

Hello, and welcome to The Manifesto with Gideon, the Free-quent Flyer, on the Milenomics Podcast Network. I’m Gideon, the Free-quent Flyer, and I’m joined today by long-time reader, German. German, welcome to the Manifesto.

[0:20] Plugs

• Twitter: @xgerman
• Milenomics slack: @xgerman

[0:44] Background

• What were your expectations for childcare before/during/after pregnancy? Nannies/babysitters/au pairs? Did you have friends or family you could talk to about what to expect in terms of options?
• Did you have any expectations about the cost of different options? How well did your estimates align with reality?
• What is an au pair? What makes an au pair different from a babysitter, nanny, childcare center, etc? What are an au pair’s duties? Cooking and cleaning for kids, but not for parents.
• Cost: $8-10k up front to agency depending on discounts. ~$196/week cash to au pair.

[7:25] Experiences with agencies

• 9-10 au pairs over the years
• Switched agencies after first agency didn’t provide enough support.
• Au pairs come in with expectations about what the “perfect” host family looks like
• Have you brought in au pairs without an agency? With an agency? How did the experiences differ? Have you used multiple agencies?
• “Cultural Care” https://culturalcare.com/
• “Au Pair in America” https://www.aupairinamerica.com/
• “Au Pair Care” https://www.aupaircare.com/
• No agency option. Pre-Covid there was some way to find an au pair without an agency and bring her over on a 6 month tourist visa.

[14:20] Agency process

• How do you get started?
• Agency director interviews family to judge fit. Excludes “bad” families and single parents.
• Access to platform. Pictures, CV’s, cover letter to parent, letters from references, in-country interview report, video of au pair.
• Select au pairs to interview from database (limited number of “likes”)
• Contact au pair to schedule interview.
• Make an offer to match, with date of beginning, etc.
• Au pair agrees
• Au pair agency gets them a J1 visa, does training in NYC (now online due to COVID)
• What is contained in the offer? What’s flexible and what’s fixed? Starting date (flexible), length of term (1 year, possibility of extension), weekly salary, duties?
• Perks: use of car, curfew, other rules
• Vacation time: 10 days paid vacation, plus option of unpaid “travel month” after end of year
• J-1 visa education requirements, $500 from host family to cover cost
• How many offers should you expect to make before getting an agreement? 3-4 “unofficial” offers before extending an “official” offer, so most offers are accepted by that stage of process. Any penalty if more than one accepts?
• Au pair shows up. What then?!?

[24:00] What to watch out for

• $100 application fee (totally waivable)
• Discounts
  • Repeat family discount
  • Referral bonus if you refer another host family
  • Discount for coming from another program
  • Discount through those workplace savings portal
  • Probably just need to ask...
• Insurance
  • You need car insurance if you have au pair drive - likely will trigger new driver fees
    • Some wiggle room if they don’t have a US driver’s license (State Farm was unable to insure people without a US drivers license, so YMMV)
  • Umbrella: time umbrella renewal to come BEFORE I add the au pair
  • Au pair agency slip in language in the contract that au pair is only liable for $300 in deductible if in an accident
  • Once got booted from insurance in Ohio after two different au pairs had minor car accidents and was sent to the high risk plan… in any case moved back to California and no issues
• Taxes and such
  • You need to collect the au pair SSN to claim the dependent care deductions
  • Workers Comp (California allegedly doesn’t need that but again YMMV)
  • Dependent Care Accounts (if your employer offers) are YMMV what they decide to cover and how they pro-rate
  • Au pairs pay taxes the first half(?) they are here - once they are back in their home country they usually don’t file (or I don’t know)

[31:52] Points and Miles?

• Nowadays, all flights are paid for by the Au Pair agency (many years ago you could use points to get them from the training site in NYC to your home)
• Can pay agency fees with credit cards / split payment.
• Tried to pay the  au pair ~$200 stipend once with venmo/Amex and got banned by Venmo but maybe there are other ways (Bravo?)
• Au pairs have SSN you could leverage for AU cards
• I got one au pair to help me buy money orders

[36:04] Rematch: when things go wrong

• Au pair files a grievance with their local agency representative (they have monthly meetings)
• There is some time they give family and au pair to resolve that (often 1-2 weeks). Create a “performance improvement plan.” Almost never works.
• Then the au pair and the family enter the rematch process for two weeks
  • Au pair needs to find a new host family in two weeks or is sent home
  • They continue to live with you (or if not feasible live with the local representative - they get paid for that so some will push for that)
• Family also looks for another au pair which is in-country either in rematch or is extending their stay - mostly to minimize interruption in childcare. In theory can get a new au pair from abroad and pay for the additional months/fees.
• Fees are front loaded so if an au pair rematches and family doesn’t find an au pair they lose lots of money
• Even if only a few months are missing that can be several $1K
• What to watch out for?
  • Vacation? Some agencies pro-rate but mostly it’’s best to not give additional vacation, e.g. 2 weeks the first months. Some families don’t let au pair take vacation and start rematch for the last month
• What has changed?
  • Au pairs almost never need to go home
  • Facebook groups to broker re-match (host families pay, au pairs free)
  • Au pairs stay in closer touch with home country
  • Because of Covid there are many more host families than au pairs so they can shop-around and cherry-pick
  • In general fewer kids are better, younger kids are better, pools is better, tourist destination is better

[46:20] Quar Question of the Week

• When do you think you’ll be going in for your first booster shot?

Thanks again to German for joining me today. You’ve been listening to The Manifesto with Gideon, the Free-quent Flyer, on the Milenomics Podcast Network. Goodbye, and good luck.