Paying Your Bills With Bi-weekly Paychecks

Pay bills biweekly paycheckOne of the advantages of getting paid bi-weekly is your ability to get ahead on your bills. Not everybody will agree that this a good idea, because that money could be used for other things. Such as investing, saving or fun stuff.

But if you’ve ever had an issue being able to pay your bills, whether it was due to job loss, small paycheck due to unpaid time off or whatnot…then this might be right you. One of the most stressful things in finances is when you just don’t have the money to pay you bills, aside of course from being able to buy food and necessities.

I’ve had that problem myself a few times in the past and it pushed me to find a solution.

The first thing I did was to figure out the average amount of each bill, since some bills can vary each month.


Utilities (power, heat) Bill

February: $180
March: $160
April: $165
May: $140
June: $120
July: $100
August: $105
September: $110
October: $115
November: $150
December: $185

The total for the whole year (by adding each of the last 12 months) is $1,730. Divide the total for the last year by 12 months 1,730 ÷ 12 = $144.16. Then for the bi-weekly amount, divide the monthly average by 2: $144.16 ÷ 2 = $72.08.

So if I paid $72.08 with each bi-weekly paycheck, then it should be enough to cover for the more expensive months. Obviously there would be a credit to the account, especially if I start in the months with the lowest usage. This is good if you’re wanting to get ahead on your bills.

The Extra Paychecks

But wait a second—if I get paid bi-weekly that means there are 2 extra paychecks each year, what’s up with that? Good observation. haha That’s how you get ahead. By making bi-weekly payments with each paycheck, you should be able to get one month ahead on your bills each year. Sorta like an emergency fund for your bills.

You could also do the same with your rent or mortgage payments, although for the mortgage payments…it would most likely be applied to the principle. Which means you would be paying down your mortgage quicker and saving a lot of money in interest.

We’re not paying off our mortgage early, so I’m sure that’s not the best route for everybody else. There are other options out there. You could just pay your bills bi-weekly, either through bill pay or personal checks, and then shove the extra rent/mortgage into your savings, Roth, investment account or use it to help with debt.

The important thing is that each bi-weekly paycheck is treated equally. This keeps you from spending more than you probably should and gives you leverage over your money.

Even if you don’t want to pay your bills and build up a credit with your 2 extra paychecks, you could just pretend you are and save or invest the money instead.

There really is a lot you can do with your money and your budget, sometimes you just need to get creative. :-)


How do you budget your bi-weekly paychecks?
Have you ever done or considered something like this?

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About Jen Perkins

Likes: saving money, being debt free (aside from our house), zombies, travel, getting money, blogging and dogs. Dislikes: debt, being broke, bunnies, wasting money, not having enough money to travel the world and paying interest. Facebook  ♥  Twitter  ♥  Google+  ♥  RSS


Paying Your Bills With Bi-weekly Paychecks — 14 Comments

  1. I’m actually one of the rare people people who also like being out in front of their bills early as well. I use a slightly different approach that still accomplishes the same thing. I have one month’s worth of bill expenses in my checking account. That way I can comfortably pay bills while the income replenishes it. It’s sort of like a bucket with a hole in the bottom but is getting filled at the top. I like this strategy because I never miss a bill and I never worry about if I can cover it or not. All in all you’ve got to do what works for you!
    My Money Design recently posted..Who is the Best IRA Provider When You Don’t Have Much Money to Open an Account?My Profile

  2. I think I’d prefer to take this mindset and “pay” that bi-weekly bill amount into a savings account to make sure you have it when the larger bills hit. You could even have a savings account specifically for this purpose. That way you’re at least earning some interest on the money and it is still earmarked for the bills.

    I know my gas and electric companies allow you to change to a system where they average your last 12 months of usage and send you a bill for the average amount over the next year, which flattens out all those swings and makes it easier to budget for as well.

  3. I never was paid biweekly although I was paid semi-monthly. Some bills are monthly so I presume you live on less and consider the 25th and 26th checks extra income. I don’t know if I would handle that way, but if it work for you great!
    krantcents recently posted..Stop the Budget Insanity!My Profile

  4. I haven’t gotten paid bi-weekly for a couple of years now, but when I did, I treated it the same as I do weekly paychecks. I just goes into the account and bills get paid. I keep a buffer of around a month’s worth of expenses in my checking account to help with cash flow.

    Also, 95% of the total cost of my monthly bills are due within the first two weeks of the month.
    Edward Antrobus recently posted..Viggle: The App That Pays You to Watch TVMy Profile

  5. My favorite thing about being paid biweekly is the extra paycheck once or twice a year! It’s like an extra boost. Plus, you’re right, it’s nice to get ahead on bills when possible.

  6. I’ve never been paid bi-weekly – it is rare in the UK although some state benefits are paid every fortnight – but I think I would regard the extra two payments as a bonus and try to think in terms of 4 week months.

    Of course the world is very inconvenient taking 365.265 days to go round the sun but then so is God for taking 7 days to create it (well, 6+1). I mean why didn’t He take 8 days – or even 12 or how about 60? Then you could divide the ‘week’ into far more equal portions. And if the world were slightly closer to the sun or revolved slightly slower, there could be 360 days in a year, as the Egyptians thought.

    Most inconsiderate.. :-)
    John@MoneyPrinciple recently posted..Old money and new friendsMy Profile

  7. I have a separate account for our monthly bills, where the money is automatically transferred to the utility companies. I have a set amount for each bill and when there is an excess amount left at the end of the month, I move them to our emergency savings account. Next year, we plan to put in our bills account an amount that is equivalent to a year’s worth of expenses.
    Cherleen @ My Personal Finance Journey recently posted..What are Your Options for Tax-Advantaged Non-Retirement Savings and Investments?My Profile

  8. What a great idea to get a month ahead of your bills by paying bi-weekly!! Especially for young people just starting out, this would be a great strategy to be sure the bills get paid plus a little extra. Great habits like this are critical to develop so that long-term credit rating success can be achieved which affects interest rates on loans and the ability to get credit at all. Great post!

  9. When my husband and I rented we always had a difficult time with our largest bill coming only once a month while we were paid bi-weekly. We were also working to pay off our line of credit and it was constantly a struggle to figure out how much to put on the line of credit depending on what bills were coming out of that paycheck.

    What we decided to do was put $1000 every two weeks onto our line of credit. Then once a month we would just write our $900 check for our rent. That way we were still always putting at least $1100 a month onto our debt except for those 3 paycheck months where we would put on $2100!

  10. Being ahead on your bills is great and so is getting paid bi-weekly. But, I’m paid on the 5th and 20th of each month. Do you have any tips for my pay schedule???

  11. I just discovered your site and I have to say you have given me hope that my husband and I can work our way towards financial independence. I have read tons of finance books, visited lots of websites, and asked several family members about all aspects of finance; but none has been as relevant to our lifestyle and income as your site has been. I had never even heard the term ‘root income’ which is exactly what we need to budget accurately. Not only are we both hourly employees, but I am a production worker which makes budgeting a nightmare! Thank you for your insight and I look forward to reading more!

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