Bi-weekly vs. semi-monthly pay explained

The sun is shining, the birds are chirping–why is today so beautiful? Oh, right–it’s payday! The feeling of a paycheck hitting your bank account is unmatched. But have you ever thought about how the timing of those paychecks–bi-weekly vs. semi-monthly–affects your financial planning? These two common pay schedules might seem similar, but their differences can impact your income flow and budget. 

In this blog, we break down these pay methods, weigh their pros and cons for employees and employers, and show you how financial wellness tools can help everyone thrive. No matter how often that sweet, sweet payday comes around. 

Definitions of bi-weekly and semi-monthly pay

Two things you should know before we define these two types of pay schedules: 

💡A pay period is a set time used to calculate how much money employees earn and when they get paid. Pay periods typically follow a regular schedule, such as weekly, bi-weekly, semi-monthly, or monthly.

💡Getting paid bi-weekly or semi-monthly won’t affect how you’re taxed.

What is bi-weekly pay? 

If you’re on a bi-weekly pay schedule, you get paid every two weeks. This is usually on the same day of the week, for example, every other Friday. Over one year, a bi-weekly pay schedule results in 26 paychecks. Generally, this results in two pay periods a month, with two months of the year having three pay periods. 

What is semi-monthly pay?

Employees on a semi-monthly pay schedule get paid twice a month–this isn’t the same as bi-weekly. Why? Semi-monthly paydays fall on the 1st and 15th of the month or the 15th and last day. The day of the week that your pay is deposited won't always be the same, depending on where the date falls, and weekends and holidays cause shifts in paydays. Over a year, a semi-monthly pay schedule results in 24 paychecks. 

Bi-weekly pay pros and cons for employees

Pros

• Better alignment with your weekly expenses. Bi-weekly pay matches up better with your weekly or regular purchases, like groceries, gas, childcare, and more. 

• More paychecks. If you’re a salaried employee, your final take-home won’t change if you have 24 or 26 paychecks in a year. But more frequent paychecks may make it easier to save money–especially when you get an “extra” paycheck. If you’re managing your finances month-to-month, a month with three paychecks can feel like a bonus. 

Cons

• Shifting paydates. While you generally get paid on the same day of the week, the actual dates on which your paycheck comes in differ monthly. This can make it challenging to pay bills on time. 
• Smaller paychecks. The annual amount you earn will be the same on a salary, but a biweekly pay plan processes your pay more frequently, making your paychecks smaller. 
  
  

Semi-monthly pay pros and cons for employees 

Pros

• Bigger paychecks. Remember that if you’re salaried, your total take-home isn’t any different, but semi-monthly paychecks are meatier because there are fewer overall. 
• Easier to track your take-home. Benefits deductions are simpler to manage on a semi-monthly pay cycle because they are evenly split across the two paychecks or on the same paycheck each month. This makes it easier to check for discrepancies.  
  
  

Cons

• Longer gaps between paychecks. In some months, you can feel a strain on your cash flow because you may be waiting up to 16 days for a paycheck. This can cause challenges with budgeting, especially in the event of emergencies. 
• Less flexibility. If you’re paid hourly and your weekly work hours tend to shift around, this pay schedule complicates calculating and tracking overtime. 

Bi-weekly vs. semi-monthly pay considerations for employers

When selecting a payroll schedule, employers must weigh their own pros and cons. Employers must consider all these factors as they impact payroll efficiency, employee satisfaction, and the overall payroll administration process. Choosing the right pay schedule can improve your business's financial management while helping employees manage their personal financial wellness. Here are some key considerations: 

Processing days 

Bi-weekly pay periods offer predictable processing schedules. Since employees get paid on the same day of the week (e.g., every other Friday), payroll specialists can set a regular day to process pay (e.g., every other Tuesday before payday). 

Fixed expenses 

Two months out of the year on a bi-weekly schedule, payday comes around three times instead of twice. This means you could be spending a lot more money as a business in August than in July. This isn’t an issue for businesses with a fixed and steady cash flow. Still, semi-monthly pay schedules allow businesses to standardize their pay periods and see more consistency in their profit and loss statements. 

Financial planning and budgeting on a bi-weekly pay schedule

Spend your “extra” paychecks wisely by planning ahead. Two months out of the year, you’ll get paid three times, not just twice. By identifying those months ahead of time, you’ll know when you might have more cash coming in. 

That “extra” paycheck can be used to build your emergency fund. Experts recommend having at least 3 months' worth of expenses saved for unexpected things like medical emergencies or urgent car and home repairs. 

And hey, we’re all about the “treat yourself” lifestyle, too. If you want to plan a weekend trip, surprise a loved one with concert tickets, or finally snag that cool pair of sneakers you’ve been dreaming about, planning ahead can help bring that goal to life in a three-paycheck month. 

Financial planning and budgeting on a semi-monthly pay schedule

Our biggest tip for semi-monthly pay schedules? Divide your monthly budget in half. Plan your expenses around the two pay periods (e.g., 1st to 15th and 16th to the end of the month) and try to spend evenly during them. 

Where possible, try to assign certain bills and regular expenses to each pay period to make sure you balance your spending. For example, rent is probably your biggest monthly expense. If you pay rent on the 1st of the month, try to save another monthly expense, like student loan payments, till the second half of the month. 

This strategy can help you avoid late fees, cut down on impulse purchases, prioritize the essentials, and track spending so you don’t overspend in a longer pay period.

ZayZoon supports all employees regardless of pay schedule–and works for employers, too 

Let’s face it–every two weeks is still a long time to wait to get paid. For many employees, it can feel like an eternity. ZayZoon addresses this problem head-on by providing employees with earned wage access (EWA)–instant access to their pay between pay periods. 

Our customers have told us what a difference it makes to have ZayZoon available between paychecks, and we’re proud to help because instant access to their pay is something that all employees deserve. Here’s what Brittany, a single mother, had to say about her experience using ZayZoon: 

“ZayZoon has helped tremendously. It seems like I'm always short on cash to be honest. So to have that extra cushion of $20-$30 every couple of days helps with getting groceries to feed me, my child, and our two cats. It also helps with gas to ensure I'm able to get to work. That little extra bit of money has made a huge difference and impact on our quality of life.”

ZayZoon helps employers and business owners, too! ZayZoon is completely free to employers (yes, completely) and reduces the administrative burden of handling pay advances for employees. Instead of employees coming to you to ask for pay advances, they can use ZayZoon, which is already embedded in the payroll platform you’re using. Any questions about their pay advances can also be directed to our rockstar Customer Care team. 

To learn more and get started with ZayZoon today, book a free demo.