As it is now, I get paid bi-weekly, as does my wife, but the paychecks overlap. One week I get paid, the next week my wife gets paid, then I get paid again, etc. It works out pretty well. I pay mortgage and car with my checks, groceries and various bills with her checks.
Beginning in March 2004, we will be going to semi-monthly pay periods (15th of the month, and last business day of the month).
I realize that when all is said and done at the end of the year, it works out evenly, but it seems like the new timing is going to screw me up financially?
What can I expect? Is semi-monthly it better or worse than bi-weekly?
I don’t know. I get paid monthy. I don’t really like that much.
Anyway, since bills are usually due on a pretty fixed monthly schedule I would think that it would be better to get paid on a fixed monthly (or semi-monthly) schedule as well. Just makes planning easier, I would think.
I would absolutely hate bi-monthly. With bi-weekly, I plan for getting paid twice each monther and basically budget certain bills for each check…however, 2x a year, you actually get 3 checks in a single month rather than 2 and it’s like getting a bonus. Since my monthly budget revolves around (pay amount)x(2 checks), that additional check is unclaimed money and it always makes me feel good to know that I have that buffer.
With bi-monthly, that extra 2 pays is spread out over all of your other paychecks, and it gets spent on incidentals rather than falling on you in a lump. That is the suck.
Pfft. Try being a freelancer and getting paid when the client gets around to it . . . OK, not really, but paydays come about a month after I send out invoices, which is obviously at irregular intervals, and for irregular amounts. You’re still getting paid a known amount on a regular basis. You’ll adjust.
I get paid biweekly and my husband gets paid monthly. I prefer biweekly. But I’ve had since January to get used to this, and it’s doable. I just have to bear in mind that once I go thru his big chunk of change, there won’t be any more till the end of the month. On the other hand, when the big chunk lands in the bank, I immediately put a bit into savings, before I pay any bills. It’s easier to save that way, and if we get into a pinch, I’ve got some money set aside.
I was paid twice a month once and hated it - Payday floated and it was harder to keep track of it. Every other Friday is so much easier for me.
This all leads to ‘living from paycheck to paycheck’ discussion, doesn’t it? It does in my mind anyway.
I will not diverge though, best bet IMHO is to stash away literally whatever you can so that, whether it’s every two weeks or twice a month, there’s always a buffer. And if you don’t use it then that buffer just keeps getting bigger and before you know it you have an honest to goodness savings account (/vacation/xmas/emergency fund).
Having done both, I do prefer the bi-weekly paychecks myself (it’s a psychological thing) but as traub states scheduled payments make more sense.
I’ve been paid biweekly, bimonthy, monthly, and even weekly (yes, kiddies – they used to give you a paycheck every single week!). I prefer weekly, but that’s not an option, and biweekly is the best of the other choices. However, when my employeer changed from biweekly to bimonthly, it didn’t take too much adjustment.
Our insurance is taken out bi-monthly, so twice a year, when there’s three paydays in the month, our last paycheck that month is a little bigger because you don’t have to pay insurance.
Since my bills (and probably yours, too) are due on a schedule that uses the month as it’s base, I prefer getting paid twice a month. I KNOW what each paycheck will be (I am salaried), and I know EXACTLY what fixed costs are coming out of each paycheck. I use a budget spreadsheet set up at two pay periods a month, 15th and last day. Simpler planning for me than a bi-weekly paycheck with bills on a monthly schedule, like the wife used to get.