One of my Soldiers recently changed his paycheck to receive only one payment per month instead of the standard two, the traditional paychecks of the first and the fifteenth. I even had forgotten that this was an option, and it is one that I think is only used by a few members of the military. While I do not personally use the one paycheck per month method of receiving a salary, nor do I recommend it, below are the benefits and negative aspects of such a decision.
The Drawbacks Of A Once A Month Paycheck
It takes discipline to budget your money for four weeks after only receiving a paycheck once a month. Many young people, like my young Soldier, cannot handle the responsibility. It is like a siren song when someone has money available in their pocket or bank account. For many, the urge to spend it is too great. This creates a real problem if you are not disciplined in your budget since certain big ticket items usually occur in both two week blocks of the month. You run the risk of finding yourself out of money by the 15th with no paycheck in sight for two weeks and a car payment looming.
What Can You Do To Help Ease The One Paycheck Pain
There are a few things that you can do to ensure that you do not run out of money towards the tail end of the month if you get paid only once a month. One great tip is to shift as many of your big budget items like your mortgage, credit card payments, car payment, insurance payment, and others to the first week of the month. Most banks and financial companies will let you decide on the due date if you are in good standing with them. After you have paid all of your bills in this manner, you will have a great sense of how much spending money you will have for the rest of the month. This alone could be a great budgeting tool for the miscellaneous category, mad money, and spending money portion of your monthly budget.
Have A Written Monthly Budget To Ease The One Paycheck Pain
Everyone should have a monthly budget, and every budget should be written down in advance. Financial planning guru and debt reduction expert Dave Ramsey says that every dollar that you receive from your paycheck needs to be allocated in advance and in writing. Every dollar needs to have a name. Many of mine say mortgage, car payment, insurance payment, and the like. But, there should be no confusion as to how much money is going to each job in your written budget. Having a written budget in this way will help you allocate your money whether you get paid once a month or twice.
The Benefits Of A Once A Month Paycheck
I am trying to think of the benefits of a once per month paycheck instead of the traditional two paychecks per month. And, I cannot think of a single one. Nothing good comes from getting paid once per month. Everyone should choose the twice monthly option.
Do you agree? Sell me on why you like getting paid only once a month? I’d love to debate it.