Miserable March

For those of us that get paid every two weeks, we face a battle of epic proportions. Managing a budget is no easy task, especially when all months AREN’T created equal. Ten months a year we might bring home $4,000, but two months of the year we bring home $6,000. Why must such cruel things exist!?

Although an extra paycheck is definitely a good problem to have, there is no denying it adds a little hiccup to the budgeting process. Us “three paycheckers” really only have two options…

  1. We can mentally break up the two extra paychecks. Say for example you take home $2K every two weeks. Instead of budgeting your expenses around $4,000/month, you can pretend you make $4,333/month (since that is your average monthly income over the course of a year). In my opinion this method sucks. It takes a lot of work, discipline, and patience. It also causes you to spend money you don’t necessarily have yet. My first third paycheck month doesn’t come until March each year, so by this rule, I’d be spending money in January and February that I have not yet received. It would be like spending your tax return before you actually got it. Sure, you know it’s coming, but it’s best you wait for it to get deposited in to your bank account.
  2. I like to pretend the extra paycheck is a bonus. If you take home $2,000 every two weeks, I recommend you budget your expenses around a $4k per month income. When March and August roll around, you suddenly get an extra $2,000. Two thousand dollars that does not have a budgeted purpose. You can spend it on a vacation, a unicorn, or even be responsible and open a Roth IRA. Booyah for unicorns and responsibility!

If you haven’t noticed…it’s March, which means I’ll be getting an extra paycheck this month. Perhaps I will buy a few thousand McChickens from McDonalds, maybe I’ll give this extra paycheck to one of my lucky readers, but most likely I will be boring and throw it in the good ol’ savings account. Totally un-sexy… I know.

I know I’m not the only person that gets paid every two weeks. How do you manage? What works best for you!?

40 thoughts on “Miserable March

  1. I tend to act like it doesn’t exist and throw it towards a loan or our savings account. Pretty boring yah but better for us in the long run.

  2. I feel your pain and agree that I like to think of the extra pay checks as a bonus. My monthly income also fluctuates based on what shift I am working each month and what holidays fall in any given pay period. When I work nights, my pay checks are nice. If I get stuck working day shift, my checks are pretty sad.
    It can be difficult to stay within budget each month with so many variables. I’ve tried Dave Ramsey’s irregular budget, but it doesn’t really work for me. Bills still need to be paid and animals still need to eat when I get small day shift checks. I’ve found that it helps to beef up the emergency fund with any extra income, in order to make ends meet during the lean months.

    • I have a similar situation where my income varies every month due to which shifts I work. I set my budget for a bit than lower average and typically throw the extra into savings. I haven’t decided what to do with my extra pay this month for sure. Normally, I add it to my Roth or Savings but I feel like I should set some aside to help pay for the expenses I will have due to standing up in a friends wedding.

  3. Normally I take those two extra paychecks and split them between my 4 different savings account. This year I’m going to do something different. There are a pair of tower speakers that I want for my home theater set up. They cost about 3K. Instead of saving that money this year, I will put that money aside for that purchase later this year. I’ve saved up about 2k (and growing) in an efund and 7k (and growing) in an account for when I eventually move. I’ve been looking at purchasing these speakers for over a year now and have slept on it. I still want them so I’m going to get them. I rarely ever get the urge to buy something this expensive so if I still want it after sleeping on it for a few months then I’ll go ahead and spend the money.

  4. Bonus, pure and simple. Or Roth IRA if there’s nothing I especially need. Or savings. Or a combination. I wouldn’t worry about it.

  5. My husband gets paid every 2 weeks, and I get paid twice a month (on the 15th and last day of the month). Hubby’s getting the extra pay this month as well; we have our accelerated mortgage set up to come out on his payday, and with the left-over, we typically save it for a trip/something we need for the house, etc. We’ve planned a shopping trip to the U.S. in April, so ithe extra $ will come in handy 🙂

  6. My husband gets paid every two week and we treat them as bonuses as well.

    I get commission checks once a quarter, which are even harder to budget for because they vary in amounts, and I’ve learned to also treat them as bonuses. Otherwise you can wind up pre-spending them, and they may not come through (which is how I got into CC debt in the first place).

  7. I always save it as well (with the exception of about 10-20%, which I’ll use for something fun. It doesn’t have to be all or nothing! 🙂

  8. I get paid twice a month, the same exact amount every time too, no mater if there are 28 or 31 days. It definitely makes my life a lot easier. I can understand why that would be stressful.

  9. I budget them as part of my annual savings goals. My previous job we got paid once a month and I hated it! It just felt like I never had money coming in (totally a mental thing).

  10. I get paid 26 times per year, but I budget as if I only get 24 paychecks a year – twice per month. The money from the two extra paychecks get funneled into my travel fund, mortgage, and whatever other savings I want to beef up.

  11. This bi-weekly thing has given my brain a headache ever since my husband moved to this schedule from monthly. Questions on what to do with the third paycheck, which we are also getting this month, and questions with what to do about how some months he gets paid around the 1st, and others he doesn’t get a check until later. UGH.

    But finally I came across a solution that is going to make our monthly budgeting so much easier. Basically, I’ll treat it like we’re still getting paid monthly. We’ll use March’s income to pay for April’s expenses. By being a month ahead, it doesn’t matter the paycheck arrival date, or the frequency.

    I learned about this concept from the YNAB software and it just makes a lot of sense to me.

    So…this month’s extra paycheck plus our tax refund will be used for all of April’s expenses. When he gets paid in April, that money will be set aside for May and so on.

    When we truly have extra money available, it’ll just go toward our current savings goal.

  12. Whaaaaaaaat! Our 3-check month isn’t until May, so this post was just mean.

    We pretend like it doesn’t exist, and put it straight on a debt.

  13. It will end up in a savings or roth account for sure. This is a three paycheck month for me, as well as an end of quarter employee stock purchase plan month, plus hopefully a little tax return money. I’m hoping for a +5k net worth bump aside from the market returns.

    Ohh the things that make us PF nerds smile. Giggity!

  14. I have always been paid every two weeks and budget for 24 paychecks a year. Those extra two are for fun AND savings/debt. Which has helped with owning two houses after getting married and not being able to sell one in this lovely market! I love getting paid every two weeks and pity my husband who only gets paid twice a month and doesn’t have the luxury of “bonus” paychecks. Luckily I’m a nice wife and share 😉 (yes we did combine finances after getting married.)

  15. Soooo… since my “extra” paychecks won’t come for a few more months, I have plenty of time to figure out what to do with them. :] Depending on the year I may throw them towards the car loan, or a vacation or stocks or savings.
    But may I toss out a suggestion for you? I noticed you have sort of adopted one of your teens. Maybe put it in an account specifically for expenses for him? So it’s there at a moment’s notice and you don’t have to rebudget anything for his needs?

  16. First world problems! Just kidding, just kidding. I am sure you worked hard for the money. I can’t really help you as I have never had this problem, but if I did I would probably just give a little and save a little like others have stated.

  17. I would love a biweekly paycheck because I am paid monthly! I have been paid this way for 12 years. You get used to it and cope with some savings if you need it.

  18. This is actually the first time I’ve ever been at a job that paid every two weeks. Prior to this I got paid once-a-month. So, this was actually a new concept I hadn’t considered. I base our family budget on only two paychecks per month so in that respect, I’m on target. Anyway, reading this I got super excited. We are gazelle intense right now with credit card debt so all that money is going to debt!

  19. It’s not an issue for us right now, but it used to be. I figured my monthly budget based on:

    (paycheck X 26) / 12

    That way, I always knew what I could spend in a month. It helps if you start with a bit of a cushion in your checking account.

  20. I base my *yearly* budget around (paycheck*26)/12, but my *monthly* budget around paycheck*2. There are certain large expenses that show up once or twice per year – like car insurance/AAA subscriptions and renter’s insurance, season pass ski tickets, wedding gifts, Christmas gifts and year-end donations, that I know about in advance and go in my annual budget. The monthly budget has every-month expenses like rent, gas, food, etc. If I’m overspending my monthly budget, I can see if it was caused by an annual or semi-annual expense or whether I need to cut back on my day-to-day spending. So I guess I think about it as day-to-day on the smaller budget, with the extra checks (May and October) going towards irregular expenses or savings.

    But honestly, I just keep a buffer in my checking account and don’t worry about it too much. With the monthly and annual budgets, I have a rough idea of what I plan to spend/save, and I examine it if it’s way out of whack, but I am less “I can only spend $15 on coffee this month” than I was when I first started working.

  21. My problem is that there ends up being 4 bad months (5 grocery/gasoline bills, 2 paychecks), 6 normal months (4 grocery bills, 2 paychecks), and 2 awesome months (4 grocery bills, 3 paychecks). The 4 bad months end up making me stressed out way more than the 2 awesome months make me happy…

    Has anyone tried budgeting a year with 13 “months” (each 4wks long)? I feel like this could help because even though there would be no “extra” paychecks, the regular expenses would even out much better. Also, if you spread out the dates your bills are due there would be magical surprises sprinkled throughout the year like “No Rent Month” and “No Internet Bill Month” and “No Cellphone Bill Month.”

    That just leaves one problem… what do you call the 13th Month???

    • You can take that “extra” paycheck, once received, and put it in a savings sub-account. Then, each month take 1/12 of the initial balance and use it in your monthly budget to help smooth out those months where there’s more bills than weeks.

  22. I get paid every two weeks, so I don’t do a monthly budget. Instead, I always have my budget mapped out in two-week increments, and I usually map it out for about the next four pay periods. This lets me schedule where I’ll need to pay big and/or recurring bills (mortgage, car insurance, cable, etc.). Then I give myself $550 to spend on everything else for two weeks. Anything beyond that goes straight into an investment account. In months like March, the “extra” paycheck just means I have a surplus that’s a lot larger than usual – I still give myself only $550 to spend for those two weeks. The surplus goes into the investment account like any other pay period, and nothing is really different. I’ve been doing this for the past three years and it works very well for me.

  23. I make an annual budget in excel. I have a column for each paycheck all year long. I put each bill into the pay column prior to when it is due. I don’t pay attention to getting 3 paychecks in one month I pay attention to how many paychecks between my house payments (our biggest bill) which is due on the 6th. We have 2 months of the year when we have 2 paychecks between house payments instead of only 1.
    For example March is a 3 pay month (3-1, 3-15, 3-29), but we do not benefit house payment wise from that until July. Our March payment comes out of the 3-1 check and April will come out of the 3-29 pay. This would not benefit us until you see the June house payment come out of 5-24 and the July payment not come out until 7-5. Homeowner’s insurance is due in July, so that is where the extra money will go (normally). Interseting twist this year – our house will be paid off with our June payment (woohoo)!
    Before you think we must spend everything, that is not true. Savings is also budgeted yearly. We are saving for a new car (will be our first cash only car purchase), retirement, vacations, and college monthly. I can just see it much more clearly when I plan a whole year at a time. The extra pays keep the big bills like insurance and property taxes at bay while we continue to save monthly or the bigger picture. It helps us find balance.

  24. I get paid bi-weekly and my husband weekly. I never really notice the bonus paycheque months because we pay our mortgage weekly – and that is our biggest expense. I tend to budget in two week increments as well.

  25. I budget for 2 paychecks a month and so twice a year i get those 2 additional checks… I tithe and then drop them into my Roth IRA so the amount I have to put in monthly is much more manageable.

    Eventually I hope to get to a point where I can budget the entire Roth amount in monthly and use those extra checks to pay down my mortgage… but that’s a long ways off on my income.

  26. I get paid 26 times each year and my budget is set up for that. I pay all my utilities (annual estimated amount divided by 26) and property tax every other week. A seperate amount for yearly bills (house insurance, vet, dentist, house maintenance) is estimated and divided by 26 and that amount is moved to a special savings account to use when those bills are due.

    March is an expensive month for me. I paid $82 for my car registration and $113 for my annual cell phone bill so if you are giving away money consider me.

  27. Being paid bi-weekly throws a lot of wrenches in my foolproof plan, also. I tend to have several things that I’m saving for, typically the big saving account that never hurts to top up, a vacation here and there or maybe even that splurge item that I can’t live without.

    I am lucky to have learned from prior experiences that you always need a little extra padding in your savings account to afford the challenges life throws at you. Living alone in an expensive city and on a beginner’s salary – that extra pad helps more than it hurts.

    When my bills fall on weeks when I know that my paycheck won’t, I tend to take the overages from my savings and replace those funds on months where there is an extra income, like a third paycheck. As in all things in life, there has to be a give and take – and I think we can all agree, no matter if you’re just getting started or an experienced investor, a savings cushion is never a bad thing to have.

  28. We used to solve this ‘problem’ by budgeting bi-weekly. Now that my husband and I are paid on opposite Friday’s, we budget weekly 🙂 For us, there are no ‘extra’ pay cheques.

  29. I am a huge fan of three paycheck months (of course, who isn’t?) I use it as a bonus and put it away – either invest it, or save it. I know a couple that uses their third paycheck as a means to fund a vacation each year, which is a great idea, too, because it allows you some spending freedom.

  30. We get paid weekly so we have 4 months that we get 5 paychecks. I use those for annual and semi-annual expenses (car insurance (spring and fall), property taxes (late fall), homeowner’s insurance (summer)) so I don’t have to escrow them monthly.

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