How to Budget When You Get Paid Bi-Weekly

Get paid bi-weekly? Here are the key steps to budgeting your bi-weekly pay periods!

In this article, I discuss how to budget by bi-weekly pay periods, so you can feel confident about budgeting your paychecks. When you get paid bi-weekly, you receive two or three paychecks each month. You don’t get the same number of paychecks month by month, so it can be difficult to budget your monthly bills. Also, one half of the month you have to pay more bills than the other half. With an effective budget template and routine, you can easily budget and keep track of your bi-weekly pay periods.

How to Budget Bi-Weekly Pay Periods

Budgeting bi-weekly pay periods is very similar to budgeting weekly pay periods. Using my pay period budgeting method, there are four steps to budgeting when you get paid bi-weekly. Following these steps, you will be able to budget your bi-weekly paychecks for the entire next month.

See the Bi-Weekly Budget Example below for an example on how these steps are implemented!

1. List the pay period dates that take place next month.

List the two or three pay period dates that are going to take place next month. Since you get paid bi-weekly, you receive your paycheck every two weeks on the same day. Start with any pay period that begins in your current month, but crosses over into the next month.

End with either the pay period that ends exactly on the last day of the month OR the pay period right before any pay period that takes place between the end of next month and the start of the month after that (I’ll explain this method further in the Budget Example below).

These few pay periods make up your budget month. You will create a separate budget for each pay period of your budget month.

2. Make a list of all of your budget categories or line items.

I recommend listing out all of your budget line items in every budget. This will allow you to see every bill or expense you might have during the pay period. My budget template makes this easy.

3. Make a zero-based budget for each pay period of the month.

Allocate the income of each paycheck to different budget line items until you run out of income. Once your income equals your expenses (or income – expenses = 0), you have created a zero-based budget.

4. Set aside income to pay bills later in the budget month.

With a bi-weekly pay schedule, you have two or three pay periods in the month. If during one pay period you have more bills to pay than another pay period, you may need to spread some of the income across different pay periods.

For instance, if most of your bills are paid during the first half of the month, you know you need to set aside a portion of your income from your paycheck in the second half of the the month to pay those bills coming up at the beginning of next month.

Creating a pay period budget for the whole month allows you to determine where you might need to adjust your money flow.

Bi-Weekly Budget Example

To help illustrate budgeting when you get paid bi-weekly, we will use an example of a single teacher named Sarah who is paid $1,800 on every other Friday. Let’s build her April budget:

Step 1

First, Sarah should write out the pay periods that take place next month. Since Sarah gets paid every other Friday, we will list out the 2-3 pay period dates starting on either March 24th or March 31st (both Fridays):

1. March 31-April 13, 2023
2. April 14-27, 2023

Another bi-weekly pay period possibility is:

1. March 24-April 6, 2023
2. April 7-21, 2023

Two pay periods make up Sarah’s April budget month. The first pay period starts in March, but since April 1st falls within the pay period, it is the first pay period of the month using my system.

The last pay period of the budget month ends before the end of April because the following pay period contains May 1st, making it May’s first pay period.

That’s how I determine the first and last pay periods of the budget month.

Step 2

Next, Sarah needs to write down all of her budget categories. A typical budget could have many more line items, but I will keep it simple and just list out 13 main budget categories that Dave Ramsey uses.

• Giving
• Saving
• Food
• Utilities
• Housing
• Transportation
• Health
• Insurance
• Childcare
• Lifestyle or Entertainment
• Personal Spending
• Miscellaneous
• Debt

Step 3

Now, Sarah should make a zero-based budget for each pay period of the month. I will write out one bi-weekly budget example:

Income

Total = $1,800

Expenses

• Giving – $180
• Saving –
• Food – $200
• Utilities –
• Housing – $1,000
• Transportation – $120
• Health – $40
• Insurance –
• Childcare –
• Lifestyle or Entertainment – $80
• Personal Spending –
• Miscellaneous –
• Debt – $180

Total = $1,800

Step 4

After making each bi-weekly budget for the month, Sarah needs to adjust any pay periods where there isn’t enough money. As shown by the example above, she had to pay for housing that pay period, but she did not have to pay for utilities or insurance. If she had to pay for more bills during that pay period, she might not have enough money.

If there is a pay period where there isn’t enough money for all of her expenses, it would be wise to set aside money from a previous check to spread out the income.

How to Budget When You Get Paid Bi-Weekly Tips

Here are a few extra tips to help you budget your bi-weekly paychecks!

Adjust the due dates of your bills.

Some companies allow you to do this. If you have too many bills due at once, you can try to spread them out a little.

Open a bills bank account.

If you have pay periods where you have more bills or expenses than other periods, consider opening up a bank account just for bills. Transfer extra money to it during pay periods with fewer bills, and use that money during pay periods where you have a lot of bills.

Don’t connect a debit card to this account to make it more difficult to access the money. Then, set your bills on auto-pay, so they are always paid on time. I like using this method because you can usually budget this bank account to the exact dollar.

Use sinking funds.

Sinking funds are a budgeter’s best friend. They allow you to slowly save for big purchases, such as Christmas gifts, a vacation, your car registration, etc. If you are always coming up short on money to pay the bills, maybe you aren’t effectively budgeting for the bigger, more unexpected expenses.

Decide what to do with the extra paycheck.

When you get paid bi-weekly, most months you receive two paychecks. However, there are months when you receive an extra paycheck. If you are accustomed to getting by with just two paychecks, this is a smart opportunity to make major headway on some financial goals. On the other hand, if money always feels tight, you will thank yourself later if you use the extra paycheck to cushion your bills account.

Just make sure to have a plan in place, so you don’t accidentally spend it all!

Set aside a portion every week to pay off debt or save.

If you want to pay off debt, use Dave Ramsey’s budget percentages and determine a percentage of each paycheck to put towards debt. Let’s say you want to put 20% of your income towards debt, and you bring home $2,000 every two weeks. You could pay off $400 every two weeks, or $10,400 a year! That’s the power of budgeting.

Practice.

If you practice budgeting every month, eventually, it will take you like two minutes to do. It won’t be a hassle anymore because you can look back at previous budgets to help you create your budgets quickly.

Purposeful Pay Period Budget Template

I hope this post helped! My Google Sheets budget template works with every pay schedule. Track up to six paychecks each month! Find it here.

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