Offered in a range of ways – weekly, monthly, and sometimes biweekly – when we get paid can have a big impact on our finances and spending. This week, we explore this further, looking at the difference between weekly and monthly pay.
The Pros and Cons of Monthly Payments
Pros:
- Consistency! Some people may find it easier to manage their income as they likely get the same amount at the end of each month.
- Better Money Management: Many payments, such as bills, come out monthly. When the employee is paid, they can dedicate their essential spending there and then. This means they don’t have to worry about it till the following month and see exactly what they have left for spending.
- Greater Satisfaction! An employee will see a higher amount of money monthly than weekly. This may give them a higher sense of satisfaction, boosting their confidence and morale for the next month.
Cons:
- Overspending Risks: With a higher number of money being paid in full, some may find it difficult to manage their expenses throughout the month.
- 4-week vs 5-week months: Some months are slightly longer than others, which can make budgeting difficult for some people. (You can find some steps to help improve your budgeting skills below!)
The Pros and Cons of Weekly Payments
Pros:
- Budget Friendly! Weekly payments allow a consistent and regular cash flow for the individual. This can be beneficial for those who struggle to budget monthly as well as take the stress out of any unforeseen expenses that may occur.
- Sense of Control! Particularly in zero-hour contracts. You can see the direct impact of the hours you are working on your paycheck. This gives you better flexibility and a sense of control over what you earn.
- Increased Motivation: Frequent pay might increase satisfaction each week and along with it, motivation. You don’t have to wait to be rewarded for your hard work!
Cons:
- Reduced Focus on Long-Term Goals: The regular cash flow may lead to poor financial habits, with a focus on immediate spending rather than saving for the long term. The lower amounts each week may make someone feel they can’t save as much.
Remember: Different times will work for different people, but whenever you get paid, it is important to be able to budget and spend your money wisely… here are our budgeting tips to get you started:
- Have separate accounts for your bills and spending; this way, you can see exactly how much money you have left over.
- If you are paid monthly, calculate your budget around a 5-week month so you are never caught short.
- Review your income frequently.
- Try to avoid impulse purchases. Take the time to go away and think before you purchase unnecessary items.
- Set yourself saving goals.
Written by: Bahar Bahrami
Do you have more to say? Did you find this helpful? Let us know!
Continue the conversation on our socials…
#Healthcare #WeeklyVsMonthlyPay
Sources:
Income Group: Monthly pay or weekly pay – the advantages and disadvantages
