Domestic helpers have almost become a ubiquitous part of our lives. Many Singaporeans hire a helper to take care of their chores, become a replacement parent children and aged or disabled person in the household.
Indonesia announced that they intend to stop sending new live-in maids starting as early as next year. Singaporeans dependent on maids or looking to get one will worry about how this would affect them. With 125,000 Indonesian helpers, we can expect that the impact to be significant.
A domestic helper shortage will give maid agencies a reason to increase their agency fee for maids from other countries like Philippines, Myanmar, and Sri Lanka.
Cost Of Hiring A Live-In Domestic Helper
The monthly salary of a domestic helper can start at around $500 for a helper from The Philippines. An Indonesian maid, however, will cost more because the Indonesian Embassy mandated that their maids must be paid a minimum $550 a month.
Foreign Domestic Worker Levy
The government uses the levy to regulate the number of foreign workers here. When we seek to hire a domestic helper, the levy would be an area of concern. Its mechanism is like a CPF contribution, but instead of it going to the maid, it is a tax collected by the government. Hence, it is wise to find ways to make use of the concessionary levy instead of paying the full amount.
Here is the breakdown of the levy, provided by the Ministry of Manpower:
|Type of Levy||Monthly Rate||Daily Rate|
You qualify for a concessionary levy ($60 per month) when you are under these schemes:
- Young child or grandchild scheme (the child must be a Singapore citizen under 16 years old, and is living at the same address as you)
- Aged person scheme
- Persons with disabilities scheme
Payment of the levy seems affordable on its own. However, without the concessionary levy, the $265 paid on top of a salary of at least (and likely much more in future) $550 will take a chunk out of your pay. In Singapore, the average salary is $3949 (including CPF) as at 2015. After deducting 20% for CPF contribution, the median pay would be around $3160.
You Pay More Than Just Wages And Levies
Hiring a maid will therefore be at least $610 (assuming you are hiring an Indonesian maid on the concessionary levy basis). There are more costs than the compulsory insurance and maid agency fee. Your helper’s living expenses must be budgeted too. Examples include food, utility bills, transportation (including her airfare when she visits home), to name a few.
If you include your helper’s living expenses, it can easily exceed $1000. That is more than 30% of your salary. If you have other financial obligations like paying for enrichment lessons or servicing car loans, spending more than $1000 in total for a maid may be unsustainable.
It is uncertain how much the average minimum wage of a maid here would increase in 2017. If you think the cost to you would be unsustainable, you might want to consider the following alternatives.
Enrolling a child to a childcare centre is expensive. It can range from $300 to over $1000. It is typical of private operators to command fees of more than $1000, as parents have to pay a premium for a low child-to-teacher ratio. This means their child will probably get more attention from their teacher.
A childcare centre may be one of the cheapest options, but some parents do not get a peace of mind, as they may question the cleanliness of the centre and the quality of the service there.
You can find a nanny to look after your children after school, or hire someone to take them out (the latter is more popular with expatriates). The rates depend on many factors. Some examples are qualification level (e.g. university graduate), specialized qualification (e.g. early childhood), work experience, languages spoken and written, and other tasks required (whether the nanny needs to help with laundry and other chores).
A babysitter’s rate can start from $1200 per month for part time to $1800 per month for fulltime.
Grandparents will certainly be the best option for working parents. They give you the ultimate peace of mind, because after all, they raised you.
Grandparents will probably be the most economical option because they don’t require a monthly fee. Perhaps the only costs you can compensate is your monthly allowance to them, and some extra cash for your child’s expenses.
A Career Sacrifice
Letting your career take a backseat may be the next best alternative if the aforementioned options are not viable. It will be a more prominent option if your company does not have a family-friendly work policy, such as flexible work hours.
If other family members are unable to help, perhaps the only choice is to look after your child full time. Many excuses may arise such as “we need the dual income to support the family,” “how are we going to afford our annual vacation?” The wonders of looking after your own child can be priceless. From the quality time spent, to the proper supervision and home cooked meals, your child will enjoy your company.
That said, making a career sacrifice is a personal choice that takes a lot of financial planning with your spouse before making the big decision.
Childcare centres are costly, and hiring nannies are even more expensive. While new Indonesian maids may live in dormitories instead of our homes, it may be worth a try. Nonetheless, nothing can replace the love and comfort a family member can provide for your child. That is something no amount of money can buy.
Top Image Credit: DollarsAndSense.sg
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