I’ve been employed in some form or another off and on for the last ten years. I’ve been paid biweekly, semimonthly, monthly, and with annual and more often than annual bonuses in cash and stock form.
- mid 2004 through late 2005 – biweekly minimum wage pay
- early 2006 – salaried monthly
- late 2006 – biweekly minimum wage combined with salaried semi-monthly
- mid 2007 – salaried biweekly
- late 2007 – biweekly minimum wage
- late 2008 through present – salaried monthly when employed, plus stock and cash bonuses
It took a long time before I started doing much budgeting since I’ve almost always earned far more than I needed and if I didn’t, I had a decent savings account compared to my expenses at the time. In high school, I “budgeted” by giving myself 20% of my net income to spend freely by transferring 80% of my net income to savings on pay day. I remember in late 2006, budgeting by on pay day, leaving the money in checking that I needed to pay any expected expenses until the next pay day and transferring the rest to savings. That’s similar to the system I use now except that I have a whole month between pay days and my expenses are higher, so I keep more money in checking. I’ve used this system for so long that it works pretty well for me now.
I have a job offer (yay! I’ll talk a bit more about it once I’ve accepted a job offer) and they pay biweekly. This has prompted me to re-evaluate my current money management strategy. I thought that biweekly pay would be terribly annoying, but my boyfriend convinced me that it would actually be fine since I live off of so much less than my income and I could just accumulate all of my paychecks in a savings account and transfer the spending money to checking on the 1st of every month. This strategy would allow me to earn interest on my paychecks, rather than my employer, while keeping things otherwise the same as they are now. Plus, the offered base salary is enough for one biweekly paycheck to more than cover my monthly spending, which I was hoping might be the case, but I’m still going to go with this savings account transfer strategy since it’ll help to smooth out my income, especially on the months where I won’t get a paycheck deposited due to contributing to the 401(k). (some foreshadowing for you on my 2015 savings plan!)
I always thought I would hate being paid biweekly, but I’ve mostly come to terms with it happening at this point and I think it will work out just fine :)
Readers, how have you dealt with a biweekly paycheck?