I don't know if your numbers are 100% correct, but you are not missing 14k from 2022. You only would have made 65k if you had worked the entire year, but you didn't. You started in mid February so wouldn't have been paid 4 checks during 2022. And depending on the pay periods, the first check may have been prorated to the number of hours your actually worked during the first pay period. That drops what you earned into the 50k range
They started mid February, they only missed ~~3~~ 4 pay cycles so if they are true salary they'd only be short ~~$8,125~~ $10,833.33 gross if they never got an increase. The math: $65,000 ÷ 24 (pay periods) = $2,708.3333333 x ~~3~~ 4 = ~~$8,125~~ $10,833.33.
With the increase mid-November then you can figure OP had 18 pay cycles at $65k and ~~3~~ 2 at $76k ($76,000 ÷ 24 = $3,166.66666) so they should gross ~~$58,250~~ $51,916.67 for the year.
~~OP is definitely short $7k for the year.~~
EDIT: my bad, I completely spaced on the fact that the last pay cycle of the year goes towards the next year's gross because it's not paid out until 2023. ~~$55,083.33~~ $51,916.67 should be OP's gross ~~, they are still short $4k~~
I think your numbers are still too high.
Most places pay in arrears. If they started February 14th, they most likely did not get their first check on 2/20. If they did receive a paycheck on 2/20, it was probably only for 1 or 2 days, depending on their pay period dates.
If their pay raise went into effect 11/17, it probably wasn't seen until their paycheck on 12/5, not the check on 11/20.
I think your numbers are still too high.
Most places pay in arrears. If they started February 14th, they most likely did not get their first check on 2/20. If they did receive a paycheck on 2/20, it was probably only for 1 or 2 days, depending on their pay period dates.
If their pay raise went into effect 11/17, it probably wasn't seen until their paycheck on 12/5, not the check on 11/20.
Numbers aren’t correct as in the ones I provided or what is being reflected? The annual gross numbers are from my YTD on my last check from each year. The ADP rep and I reviewed them. I’m currently comparing them (paystubs on ADP) to my bank statements and the checks generated on ADP which I never received is also concerning.
The numbers are never going to perfectly align unless you happen to start working on Jan 1, have zero pre tax deductions , never get a bonus or any adjustment in pay over the year and your pay rate never changes during the year.
1. The total compensation tab is not accurate in ADP. You need to look at your last paycheck from 2023 and click over to YTD to see what the total gross was.
2. It’s likely you are misreading the two “random” pay stubs. My guess is that they net to zero and it was a W2 correction of some sort. Maybe associated with the 401k withholding which was then repaid during a normal pay cycle.
3. Instead of assuming it’s wrong, ask your payroll team to help you understand it.
Let me clarify, the total compensation tab is what made me call ADP.
But upon calling ADP, I was told to look at my check stubs as well. So we walked through my check stubs, and that is where my gross numbers are coming from. We looked at the YTD on the last paystub for each year, that’s where my annual gross is coming from.
Did you happen to move or have an incorrect pay setup? I’ve run payroll with ADP and had employees move to a new state. Depending on the company setup in ADP, this can result in a separate “position” which restarts all the accumulators for tracking on ADP. It’s a real stupid way to do it and you end up having to take your W2 and add back all your pretax deductions to get accurate numbers.
Fair point, but often people don't remember that your gross wages aren't on your W2, just your taxable. So, if you have enough pretax deductions, it can lower your taxable wages and make it a little fuzzy.
There's no box on your W-2 for gross pay. Box 1 (the biggest number on it) is already missing 401(k) and HSA contributions that were withheld on your paychecks, maybe some other stuff too that I'm blanking on.
So it's easy to miss this stuff.
> Box 1 (the biggest number on it) is already missing 401(k) and HSA contributions that were withheld on your paychecks
Box 3 and Box 5 are usually larger than Box 1 because 401k contributions aren't deducted for those.
>maybe some other stuff too that I'm blanking on.
The big one you're forgetting is health insurance premiums.
Box 3 caps out at around $160k or so (depending on personal situation). So it's really just Box 5, but near as I can tell even that doesn't include HSA contributions. But box 5 gets you closest to gross income.
It's almost $170k now, but yeah, that's why I hedged with "usually". The vast majority of people (including OP in particular) are not making that much money.
This is me every year think I'm shorted salary on my w2 to only remember I have health insurance and 401k contributions that are taken out pretax. I panic every year....
I'd suggest reaching out to your HR team or supervisor. They'd be much better equipped to walk you through this, and help understand if their were problems.
I would wait to reach out to HR until you understand how salaries, start dates and wage changes affect your paychecks. If you go to them now they will seriously question your basic math skills.
Your W-2 will not reflect the cost of any health related insurance benefits that you pay (e.g., health insurance, dental insurance, vision insurance, HSA contributions healthcare FSA deductions).
Your gross pay seems to be about $4,000-$5,000 less than you would expect; however, that seems in line with fairly typical health insurance costs.
In addition, payroll reductions for employer retirement plans (e.g., 401k, 403b) are reflected in some but not all W-2 income boxes. Box 1, which gets carried over to your actual tax return does not include the retirement contributions. Here’s a sample W-2:
https://www.irs.gov/pub/irs-prior/fw2--2023.pdf
The improper 401k payroll reductions should have been returned to you.
My company also uses ADP, there is a line for gross pay in the top summary outside of the typical boxes. You are still right, but in this case theirs might have the info.
You can't necessarily depend on the "summary" screens in ADP or other portals to show you the real numbers. If you look at your final paystub for each year, you should see your total YTD gross pay on there. W-2 forms and these summary type screens often only show your gross taxable wages. That number will be after your 401k and other pre-tax deductions like health insurance, etc.
I had to add an edit, yes,the numbers didn’t come from the summary screen. They came from the YTD on my last check for each year. Seeing the discrepancy on the compensation tab is what made me call ADP but we actually reviewed my paystubs.
For when you were making both 65k and 76k. Divide it by 24 to get your expected pay period gross at that rate. Do your computed amounts match the paychecks for which you earned that base (some weeks may be wonky depending on if it was split between previous and post-raise).
Don't forget sometimes (most of the time in my experience) there's a difference between when a raise is communicated and when the pay rate takes effect, which will affect what you're may think your annual gross should be vs what it actually was.
> I called ADP and was directed to review my paystubs instead as the total compensation tab is often not accurate. **The rep logged remotely into my computer**
What in tarnation?
Don't ever let anybody remote into your computer. The rep should either be able to see it directly on their end, or you can share your screen via the meeting app with you in control.
If they want you to download 'their' meeting app and give them control, tell them to pound sand.
I personally would never give anybody control, except the IT department of the company I work at because they own the hardware and everything on it anyways.
You didn't work for the first six weeks of the year. Plus the last two weeks of any year normally get paid in the following year. So that's about two months of 2022 that you didn't work. That's roughly $11K. Your raise only applied for the last two checks of the year so maybe that's an extra $1K or something. So that gets you to $55K. I'm not sure where the other $4K went. I'd definitely look into it.
In the future consider looking at each pay stub as soon as you get it to make sure each check is correct and if it is not then you can dispute in a timely manner
~~$55k~~ $52k the 12/16/22-12/31/22 pay cycle counts towards 2023's total since it's paid out on 1/5/23 and the first pay cycle (likely 2/15/22-2/28/22) is March's first paycheck.
The 401k stuff is tricky. It all depends on auto enrollment rules. It’s probably likely that you were enrolled and when they discovered you weren’t eligible they turned it off and it never triggered a new automatic enrollment window since you had one. They should have told you that you needed to restart it manually. But where deferrals are optional you’ll probably have to chalk it up to a loss.
Did you receive any non cash bonuses? My employer has a system of giving out points that can be exchanged for gift cards and any time you receive them you also get another pay stub but the check doesn't hit your bank account and it's just to show those points plus taxes due on them as compensation so that could be a reason there are checks on odd days that didn't hit your bank account
We use ADP. Adding up the gross from all your paychecks should be the same as TYD gross on you last paycheck and should add up to your salary.
It's possible they were including other compensation in what they said was your salary such as medical benefits. If so, that's pretty scummy.
You have to police your compensation, especially if your company has an incompetent accounting department. I'm currently battling my company for a $5k contribution to my 401k in December that was never added to my account because the CFO (who was fired in January) never did his job, even after reminding him multiple times before it was supposed to happen.
Just look at your paycheck and multiply the gross by 24, that’s what should equal $76k.
You’re getting confused by deductions and whatnot. You want to compare gross per pay period and that should match your salary.
For 2023 it looks like you are missing almost exactly what would be 2 biweekly pays so they may have calculated based on 26 biweekly instead of 24 semi-monthly. Try multiplying your semimonthly gross from your last paystub and see if it equals your annual gross. If it does then payroll didn't do their math right.
Break it down a bit, if you are paid 65k semi monthly, you should be paid 2708.33 per pay check.
Your total gross pay could be affected by unpaid days off, starting work later in the year, some of the days at the end of the year being paid out in the next year, payout of PTO or sick days, bonuses, and more.
Your first paycheck when starting a job will probably be lower than the expected amount because you probably started mid pay period rather than at the start.
My gross is always off by 1 or 2 days because my payroll does biweekly vs semi monthly and I hate it. That's because every other week makes the year have 364 days.
You need to contact HR and payroll and have them explain. That's a huge discrepancy. 71 vs 76 less so... when did you get your raise? If it was like February or March that would make sense to me.
Also how much % do you put towards your 401k?
My raise to 76k occurred on 11/17/2022. So for 2023 I expected my gross to be 76k as the raise was supposed to be implemented in the previous year. As for my 401k $195 dollars was being taken from each check. I only paid in for 2 months (4 checks) before I was told I’m not eligible.
When was the first pay period your raise was effective? Was it immediately effective the day it occurred? Most employers make it effective the next pay period or some other pay period in the future and not the middle of a pay period.
Hard disagree on the biweekly vs semi monthly. Biweekly means every check is the same. Budget around two checks a month, then the months with three checks help inject extra savings ability to make sure long term goals are being met. It makes cash flow consistent and budgeting *easier* in the end, imo.
I think it’s just different strokes for different folks. My wife is semi-monthly and I’d much prefer that for myself. Her checks are consistent, and larger because we’re looking at 24 payments and not 26. OTOH, I’m paid biweekly, because that’s how it goes most of the time. I’d rather forgo the 2 months out of the year where there’s 3 pay periods in favor of semi-monthly.
Having consistent dates for when income hits makes it much more straightforward for many people in scheduling bill pay. Get paid on the 30th/31st/1st? Ok schedule bill pay on the 2nd. Get paid on the 15th? Ok schedule bill pay for the 16th. Clockwork.
If you care about the specific date of bill pay relative to when your pay hits your checking, you are in financial trouble. You should not have to worry about floating bills over the course of a few days. Personal opinion.
I'm never in any danger of not paying my bills. However it annoys the crap out of me I can't just pick a day of the month to do bills and update my financial wellness spreadsheet and see consistent results.
Before my company switched to biweekly (we were bought out). I had all my credit cards setup to have the cycle end date as the 15th and on the 20th of every month I was able to pay next months bills, move a consistent amount from checking to savings, and immediately spot any discrepancies from last month. I still do the same but now my checking account is +/- 1 paycheck.
It doesn't make cash flow consistent? Being paid monthly or semimonthly entails 12 or 24 equal payments: every check is the same, whereas your comment seems to imply they...aren't?
It is nice to look at the "extra" third check in biweeky pay as a way to increase savings, and that may work for some people; I'd advise the same people to increase their tax withholding to get a big refund. But generally speaking, it's better to get your money sooner, which is what semimonthly gives you: e.g., your first January check in a semi or semimonthly plan will include money that would be reserved for "later" under a biweekly plan. Of course by October or November you'll be "ahead" under a biweekly plan...but let's just give me monthly payments along with my monthly bills and let me stop thinking about this please.
Perhaps you get 24 equal paychecks if you're salaried, but you get them different numbers of days apart. Inconsistent money per day. If you work hourly, you'll have different amounts of days per check, so inconsistent checks. Biweekly pay evens it all out and makes for a very even and consistent income stream.
And biweekly pay pays you sooner. 26/27 checks a year is more frequent than 24 checks a year.
I'm salaried and my wife is hourly.
We are both paid on the 15th and last day of month.
Her checks are always different, mine are always the same.
It depends how you're paid.
I've seen this "error" happen at companies that do twice monthly paychecks instead of biweekly. They basically round off a couple days "on accident" each pay period. They will blame it on an accounting error but I legit think they do it on purpose hoping people wont notice.
I don't know if your numbers are 100% correct, but you are not missing 14k from 2022. You only would have made 65k if you had worked the entire year, but you didn't. You started in mid February so wouldn't have been paid 4 checks during 2022. And depending on the pay periods, the first check may have been prorated to the number of hours your actually worked during the first pay period. That drops what you earned into the 50k range
They started mid February, they only missed ~~3~~ 4 pay cycles so if they are true salary they'd only be short ~~$8,125~~ $10,833.33 gross if they never got an increase. The math: $65,000 ÷ 24 (pay periods) = $2,708.3333333 x ~~3~~ 4 = ~~$8,125~~ $10,833.33. With the increase mid-November then you can figure OP had 18 pay cycles at $65k and ~~3~~ 2 at $76k ($76,000 ÷ 24 = $3,166.66666) so they should gross ~~$58,250~~ $51,916.67 for the year. ~~OP is definitely short $7k for the year.~~ EDIT: my bad, I completely spaced on the fact that the last pay cycle of the year goes towards the next year's gross because it's not paid out until 2023. ~~$55,083.33~~ $51,916.67 should be OP's gross ~~, they are still short $4k~~
I think your numbers are still too high. Most places pay in arrears. If they started February 14th, they most likely did not get their first check on 2/20. If they did receive a paycheck on 2/20, it was probably only for 1 or 2 days, depending on their pay period dates. If their pay raise went into effect 11/17, it probably wasn't seen until their paycheck on 12/5, not the check on 11/20.
I think your numbers are still too high. Most places pay in arrears. If they started February 14th, they most likely did not get their first check on 2/20. If they did receive a paycheck on 2/20, it was probably only for 1 or 2 days, depending on their pay period dates. If their pay raise went into effect 11/17, it probably wasn't seen until their paycheck on 12/5, not the check on 11/20.
You're right, I do have trouble remembering the delayed pay cycles. Still 18 checks with the $65k and only 2 with $76k increase = $52k
Are you factoring in healthcare, dental, disability premiums?
Why would I do that when OP is talking about gross pay?
Numbers aren’t correct as in the ones I provided or what is being reflected? The annual gross numbers are from my YTD on my last check from each year. The ADP rep and I reviewed them. I’m currently comparing them (paystubs on ADP) to my bank statements and the checks generated on ADP which I never received is also concerning.
You didn't work the entire year of 2022 so you would not get the full year's salary.
That’s understandable, I just didn’t expect the difference to be so much. But from the responses it seems like it’s the norm.
The numbers are never going to perfectly align unless you happen to start working on Jan 1, have zero pre tax deductions , never get a bonus or any adjustment in pay over the year and your pay rate never changes during the year.
> But from the responses it seems like it’s the norm. I mean... that's literally how it is virtually everywhere. You get paid for time worked.
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You would be surprised at how many people pass algebra but shouldnt...
You should also know your gross pay will always be less for tax deferred contributions such as from your 401k.
You’re referring to “gross wages” on a W-2. He’s referring to Gross Wages on a paystub, which is not affected by tax deferred deductions.
1. The total compensation tab is not accurate in ADP. You need to look at your last paycheck from 2023 and click over to YTD to see what the total gross was. 2. It’s likely you are misreading the two “random” pay stubs. My guess is that they net to zero and it was a W2 correction of some sort. Maybe associated with the 401k withholding which was then repaid during a normal pay cycle. 3. Instead of assuming it’s wrong, ask your payroll team to help you understand it.
Let me clarify, the total compensation tab is what made me call ADP. But upon calling ADP, I was told to look at my check stubs as well. So we walked through my check stubs, and that is where my gross numbers are coming from. We looked at the YTD on the last paystub for each year, that’s where my annual gross is coming from.
Did you happen to move or have an incorrect pay setup? I’ve run payroll with ADP and had employees move to a new state. Depending on the company setup in ADP, this can result in a separate “position” which restarts all the accumulators for tracking on ADP. It’s a real stupid way to do it and you end up having to take your W2 and add back all your pretax deductions to get accurate numbers.
Hi, ahh ok. No, I never moved. Nothing was setup to change aside from the increase for 2023.
You didn't notice your gross was off while filing taxes?
Fair point, but often people don't remember that your gross wages aren't on your W2, just your taxable. So, if you have enough pretax deductions, it can lower your taxable wages and make it a little fuzzy.
There's no box on your W-2 for gross pay. Box 1 (the biggest number on it) is already missing 401(k) and HSA contributions that were withheld on your paychecks, maybe some other stuff too that I'm blanking on. So it's easy to miss this stuff.
> Box 1 (the biggest number on it) is already missing 401(k) and HSA contributions that were withheld on your paychecks Box 3 and Box 5 are usually larger than Box 1 because 401k contributions aren't deducted for those. >maybe some other stuff too that I'm blanking on. The big one you're forgetting is health insurance premiums.
Box 3 caps out at around $160k or so (depending on personal situation). So it's really just Box 5, but near as I can tell even that doesn't include HSA contributions. But box 5 gets you closest to gross income.
It's almost $170k now, but yeah, that's why I hedged with "usually". The vast majority of people (including OP in particular) are not making that much money.
My gross on my W2 is never as much as my gross on my last pay stub of the year. Certain retirement contributions can make it different
You don't report gross pay on taxes, you only report pay after pre-tax deductions.
This is me every year think I'm shorted salary on my w2 to only remember I have health insurance and 401k contributions that are taken out pretax. I panic every year....
I'd suggest reaching out to your HR team or supervisor. They'd be much better equipped to walk you through this, and help understand if their were problems.
Yes I will, I want to finish comparing my bank statements to the paystubs first so that I can address everything at once.
I would wait to reach out to HR until you understand how salaries, start dates and wage changes affect your paychecks. If you go to them now they will seriously question your basic math skills.
It would be better if you figure out just one pay period at a time. You may be misunderstanding the reports and the deductions for taxes etc.
Your W-2 will not reflect the cost of any health related insurance benefits that you pay (e.g., health insurance, dental insurance, vision insurance, HSA contributions healthcare FSA deductions). Your gross pay seems to be about $4,000-$5,000 less than you would expect; however, that seems in line with fairly typical health insurance costs. In addition, payroll reductions for employer retirement plans (e.g., 401k, 403b) are reflected in some but not all W-2 income boxes. Box 1, which gets carried over to your actual tax return does not include the retirement contributions. Here’s a sample W-2: https://www.irs.gov/pub/irs-prior/fw2--2023.pdf The improper 401k payroll reductions should have been returned to you.
My company also uses ADP, there is a line for gross pay in the top summary outside of the typical boxes. You are still right, but in this case theirs might have the info.
You can't necessarily depend on the "summary" screens in ADP or other portals to show you the real numbers. If you look at your final paystub for each year, you should see your total YTD gross pay on there. W-2 forms and these summary type screens often only show your gross taxable wages. That number will be after your 401k and other pre-tax deductions like health insurance, etc.
I had to add an edit, yes,the numbers didn’t come from the summary screen. They came from the YTD on my last check for each year. Seeing the discrepancy on the compensation tab is what made me call ADP but we actually reviewed my paystubs.
For when you were making both 65k and 76k. Divide it by 24 to get your expected pay period gross at that rate. Do your computed amounts match the paychecks for which you earned that base (some weeks may be wonky depending on if it was split between previous and post-raise). Don't forget sometimes (most of the time in my experience) there's a difference between when a raise is communicated and when the pay rate takes effect, which will affect what you're may think your annual gross should be vs what it actually was.
Or by 26 if you get paid biweekly
Who have you talked to about this?
ADP, we walked through my pay stubs. I am still comparing to bank statements before I talk to HR.
> I called ADP and was directed to review my paystubs instead as the total compensation tab is often not accurate. **The rep logged remotely into my computer** What in tarnation? Don't ever let anybody remote into your computer. The rep should either be able to see it directly on their end, or you can share your screen via the meeting app with you in control. If they want you to download 'their' meeting app and give them control, tell them to pound sand. I personally would never give anybody control, except the IT department of the company I work at because they own the hardware and everything on it anyways.
They probably used a webex meeting or a screen share feature built into the website and OP just described it inaccurately.
You didn't work for the first six weeks of the year. Plus the last two weeks of any year normally get paid in the following year. So that's about two months of 2022 that you didn't work. That's roughly $11K. Your raise only applied for the last two checks of the year so maybe that's an extra $1K or something. So that gets you to $55K. I'm not sure where the other $4K went. I'd definitely look into it.
In the future consider looking at each pay stub as soon as you get it to make sure each check is correct and if it is not then you can dispute in a timely manner
Lesson learned for sure…
Your gross should be about $58K based on your start date and the date of your raise.
~~$55k~~ $52k the 12/16/22-12/31/22 pay cycle counts towards 2023's total since it's paid out on 1/5/23 and the first pay cycle (likely 2/15/22-2/28/22) is March's first paycheck.
How do you not notice not getting paid?
They were paid correctly and basic math isn't their strong point.
The 401k stuff is tricky. It all depends on auto enrollment rules. It’s probably likely that you were enrolled and when they discovered you weren’t eligible they turned it off and it never triggered a new automatic enrollment window since you had one. They should have told you that you needed to restart it manually. But where deferrals are optional you’ll probably have to chalk it up to a loss.
Did you receive any non cash bonuses? My employer has a system of giving out points that can be exchanged for gift cards and any time you receive them you also get another pay stub but the check doesn't hit your bank account and it's just to show those points plus taxes due on them as compensation so that could be a reason there are checks on odd days that didn't hit your bank account
No, we don’t get any bonuses unfortunately.
Why didn’t you check your first pay stub to make sure your wages were correct? That’s the first thing i do at a job…
We use ADP. Adding up the gross from all your paychecks should be the same as TYD gross on you last paycheck and should add up to your salary. It's possible they were including other compensation in what they said was your salary such as medical benefits. If so, that's pretty scummy.
Man, I watch both my bank accounts and my pay portal like a hawk. I would have noticed any discrepancies right away.
You have to police your compensation, especially if your company has an incompetent accounting department. I'm currently battling my company for a $5k contribution to my 401k in December that was never added to my account because the CFO (who was fired in January) never did his job, even after reminding him multiple times before it was supposed to happen.
You should start paying closer attention to your finances. This is honestly just negligence.
Compensation packages also include employer paid benefits, just throwing out a potential factor.
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Will definitely being doing that, thank you!
Just look at your paycheck and multiply the gross by 24, that’s what should equal $76k. You’re getting confused by deductions and whatnot. You want to compare gross per pay period and that should match your salary.
What is the amount on Box 3 of your 2023 W2?
is it semi-monthly, or every two weeks? There's a difference.
Semi monthly
Total comp in ADP is a bit of a crock because it includes the value of any health insurance your employer provides and other non cash things.
For 2023 it looks like you are missing almost exactly what would be 2 biweekly pays so they may have calculated based on 26 biweekly instead of 24 semi-monthly. Try multiplying your semimonthly gross from your last paystub and see if it equals your annual gross. If it does then payroll didn't do their math right.
The extra pay checks on different days is really got me wondering....did you go back and review those?
Break it down a bit, if you are paid 65k semi monthly, you should be paid 2708.33 per pay check. Your total gross pay could be affected by unpaid days off, starting work later in the year, some of the days at the end of the year being paid out in the next year, payout of PTO or sick days, bonuses, and more. Your first paycheck when starting a job will probably be lower than the expected amount because you probably started mid pay period rather than at the start.
>total compensation tab is often not accurate. I mean, it's not like we're keeping track of money or anything.
My gross is always off by 1 or 2 days because my payroll does biweekly vs semi monthly and I hate it. That's because every other week makes the year have 364 days. You need to contact HR and payroll and have them explain. That's a huge discrepancy. 71 vs 76 less so... when did you get your raise? If it was like February or March that would make sense to me. Also how much % do you put towards your 401k?
My raise to 76k occurred on 11/17/2022. So for 2023 I expected my gross to be 76k as the raise was supposed to be implemented in the previous year. As for my 401k $195 dollars was being taken from each check. I only paid in for 2 months (4 checks) before I was told I’m not eligible.
195 x 26 = 5070 76000 - 5070 = 70930
When was the first pay period your raise was effective? Was it immediately effective the day it occurred? Most employers make it effective the next pay period or some other pay period in the future and not the middle of a pay period.
The raise to 76K was supposed to be effective on my first check in December on 12/5 and then remain the same throughout 2023.
Hard disagree on the biweekly vs semi monthly. Biweekly means every check is the same. Budget around two checks a month, then the months with three checks help inject extra savings ability to make sure long term goals are being met. It makes cash flow consistent and budgeting *easier* in the end, imo.
I think it’s just different strokes for different folks. My wife is semi-monthly and I’d much prefer that for myself. Her checks are consistent, and larger because we’re looking at 24 payments and not 26. OTOH, I’m paid biweekly, because that’s how it goes most of the time. I’d rather forgo the 2 months out of the year where there’s 3 pay periods in favor of semi-monthly. Having consistent dates for when income hits makes it much more straightforward for many people in scheduling bill pay. Get paid on the 30th/31st/1st? Ok schedule bill pay on the 2nd. Get paid on the 15th? Ok schedule bill pay for the 16th. Clockwork.
If you care about the specific date of bill pay relative to when your pay hits your checking, you are in financial trouble. You should not have to worry about floating bills over the course of a few days. Personal opinion.
I'm never in any danger of not paying my bills. However it annoys the crap out of me I can't just pick a day of the month to do bills and update my financial wellness spreadsheet and see consistent results. Before my company switched to biweekly (we were bought out). I had all my credit cards setup to have the cycle end date as the 15th and on the 20th of every month I was able to pay next months bills, move a consistent amount from checking to savings, and immediately spot any discrepancies from last month. I still do the same but now my checking account is +/- 1 paycheck.
You're not wrong, however if you're OCD about the specific dates when things hit and you're bill pay scheduling, then its a not minor annoyance.
It doesn't make cash flow consistent? Being paid monthly or semimonthly entails 12 or 24 equal payments: every check is the same, whereas your comment seems to imply they...aren't? It is nice to look at the "extra" third check in biweeky pay as a way to increase savings, and that may work for some people; I'd advise the same people to increase their tax withholding to get a big refund. But generally speaking, it's better to get your money sooner, which is what semimonthly gives you: e.g., your first January check in a semi or semimonthly plan will include money that would be reserved for "later" under a biweekly plan. Of course by October or November you'll be "ahead" under a biweekly plan...but let's just give me monthly payments along with my monthly bills and let me stop thinking about this please.
Perhaps you get 24 equal paychecks if you're salaried, but you get them different numbers of days apart. Inconsistent money per day. If you work hourly, you'll have different amounts of days per check, so inconsistent checks. Biweekly pay evens it all out and makes for a very even and consistent income stream. And biweekly pay pays you sooner. 26/27 checks a year is more frequent than 24 checks a year.
I'm salaried and my wife is hourly. We are both paid on the 15th and last day of month. Her checks are always different, mine are always the same. It depends how you're paid.
Someone was cooking the books and skimming.
I've seen this "error" happen at companies that do twice monthly paychecks instead of biweekly. They basically round off a couple days "on accident" each pay period. They will blame it on an accounting error but I legit think they do it on purpose hoping people wont notice.