How often you receive your paycheck can have a significant impact on how you budget. There are some employers who give you a choice of how often you are paid, but usually, a company will have the same pay period for all employees.
If you are considering a job that pays once a month or has the option of choosing the frequency of your pay period, you might be looking into the pros and cons of getting paid once a month.
Budgeting when you get paid once a month has its own set of challenges.
There are benefits and drawbacks to every type of pay schedule. Today we will take a deep dive into the good and the bad of getting paid once a month.
5 Easy Steps to Budgeting When You Get Paid Once a Month
Step one: know your income and expenses
When creating a budget, first, know all the expenses you have. Go through all bank statements and list every bill you can find and when they are due.
Include anything that might come in every quarter and once a year. This way, you can divide these up into monthly amounts and have a sinking fund for those.
If something is a variable expense like electric for example, then look for an average bill amount.
Step two: plan for other variable needs
Decide how much you need to spend on groceries, gas, date nights, and any other activities in your life. Consider grocery shopping once a month.
Add this money to cash envelopes so you can stay within your budgeted amount. Have them marked for weeks one through 4 (or 5)
Step three: create a zero based budget
Plug all of the numbers into the budget and make sure they equal out to zero. A zero-based budget is fantastic because every dollar has a job. And with a little practice, all your money will have a system of its own.
Step four: cut back on spending
If you find you are overspending and have more month than money, it’s time to tweak the system. Creating a budget is all about trial and error.
Consider being a little more frugal and cutting out things that are not a need.
Step five: don’t forget fun money
Be sure to give yourself some fun money. Having an allotted amount of money will help with the feeling of restriction. Also, keeping in mind that this is all the money you have until next month is a big lesson and something that will get easier with time.

What are the different types of pay periods available?
There are four types of pay periods; weekly, bi-weekly, semi-monthly, and monthly. In 2019, the Bureau of Labor Statistics reported the most common pay period was bi-weekly, with an estimated 42.2% of private companies paying their employees every other week. The next most common pay period was weekly (33.8%), followed by semi-monthly (18.6%) and monthly (5.4%).
A weekly pay period means employees are paid every single week (52 paychecks a year). Employees with a bi-weekly pay period are paid every other week (26 paychecks a year). Semi-monthly pay periods are twice a month, usually on the same dates each month, for example, the 1st and 15th (24 paychecks a year). The least common pay period, monthly, pays on a set day each month (12 paychecks a year).
What types of industries typically have monthly pay periods?
If you are a military member in the Army or Air Force, you can opt to have your payment in a monthly lump sum. Other industries with a higher frequency of monthly pay include finance, trade, transportation and utilities, and private businesses involved in the information industry.
Companies choose monthly pay periods for a few reasons. It is easier and less expensive for them to run payroll once a month versus processing payroll 2, 3, or 4 times a month. However, it is the least common pay period used by private businesses, most likely because they recognize that some employees struggle with getting paid monthly.
Pros of getting paid once a month:
Getting paid once a month has several benefits. Therefore budgeting once a month is a necessity. The overarching advantage is that it simplifies budgeting when you get paid once a month because of the following reasons:
One budget:
Once a monthly payment means you only have to work with one budget. Instead of splitting large bills like a mortgage between weekly, bi-weekly, or semi-monthly paychecks, you will only have one budget that will stay consistent for the whole month.
All of your pay at one time:
Each payday, you will have all of your money for the month at once. This will make it easier to make large payments or purchases because you will have every penny for the month in your bank at the same time.
All bills get paid at the start of the month:
You can set up your bills so that they will all get paid at the beginning of the month (or before the beginning of the next month). This will make it easier to keep tabs on all of your bills.
Easier to contribute to 401K/Retirement:
It will be easier to set up retirement contributions to come from your once-a-month paycheck. You’ll be less likely to contribute only *IF* you have money at the end of the month because you’ll start with your whole paycheck upfront.
Easy to spot errors:
Getting paid once a month drastically reduces the pay stubs you should be monitoring for any discrepancies in pay. It will be easier to see when errors have happened if you only have to check once a month.
Prepares you for retirement pay:
If you plan to draw from Social Security or a pension for your retirement, living, and budgeting once a month payday will prepare you for retirement pay that is typically dispersed monthly.
Agile investments:
If you are careful with your budget and spending, having a bigger payday will allow you to be more agile when investing. You will have a more considerable amount of money to pull from if you see a significant investment that you want to jump on.
Helps you think big picture:
Although it might take some adjusting to thinking more big picture, living on a monthly budget will force you to think ahead. If you have a birthday or anniversary coming up, you’ll need to plan and set aside money in advance of that date. Christmas shopping will need to be done a bit each month or planned by saving a certain amount every payday.
Less Stressful:
Overall, many people think that getting paid monthly makes budgeting once a month more simple and less stressful.

Cons to getting paid monthly
There are some definite drawbacks to getting paid once-a-month, including:
Easy to overspend:
This will be true, especially when you first begin getting monthly pay. Your bank balance will be so much larger than you are used to on payday that you might be fooled into thinking you have plenty of money. The trick to overcoming this misconception is carefully planning out your expenses and save some money for the unexpected (hello budgeting!).
Long wait for next check:
If due to unexpected expenses or poor planning, you DO run out of money, a monthly pay period means a potentially looooong wait for your next check.
Must be meticulous at controlling spending:
Since you are receiving all of your money at once, you have to be very careful with your spending. This includes thinking about expenses that might pop up as the month goes on and setting aside money, so you don’t run out before the next time you are paid.
Tax Withholdings aren’t as quick to adjust:
If you decide to change your tax withholding, it will take longer to adjust that since you will have to wait until the next pay period for it to kick in.
Who should choose Once a Month Pay Period?
If you have the ability to choose the type of pay period you want or are considering jobs with different pay periods, here are some things to think about.
Choose a Monthly Pay Period if you:
- Want to simplify bill paying and budgeting
- Are good at forecasting future expenses
- Like to plan ahead
- Want to invest more in your retirement
- Don’t feel the need to spend money just because you have it
Getting paid once a month can simplify your budgeting and be dangerous if you have a hard time controlling your spending or if you don’t typically like to plan. There may be an adjustment period as you get used to seeing your bank balance get lower and lower as the month goes along, but this type of pay period can also empower you to spend wisely.
If you find yourself in a job that pays monthly, one of the best things that you can do is establish a budget and make a plan. I would encourage you to create a zero-based budget with sinking funds that allow you to plan for both expected and unexpected future expenses.
By assigning every penny a job, you will know exactly where your monthly paycheck is going and have the security of knowing you have funds available for expenses that might occur later in the month.
If starting or fine-tuning a budget for a monthly pay period feels overwhelming, I would love to offer my assistance as a certified financial coach.
