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In this video, Matu explains how to create a nanny contract using legal templates. Viewers are directed to click a link to legaltemplates.net and select "business forms" at the top of the page. Instead of scrolling through numerous forms, Matu recommends using the search feature to find the desired contract. He emphasizes that the nanny service is a type of service contract where the provider is the nanny and the buyer is the family requiring care. Key components include providing detailed information about both parties and a description of the nanny's services. The tutorial aims to simplify the process of creating a comprehensive nanny contract.