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There is no annual difference in pay between monthly paychecks and bi-weekly paychecks - it is only a change in the timing of your paychecks.  Instead of receiving 12 monthly paychecks of $x, you will receive 26 bi-weekly paychecks of $y - again, the annual total will be the same, but the amount of each paycheck will decrease.  Additionally, the change in the timing of your paychecks will result in different paydays each month.

Step One - Determine how much each of your paychecks will change:

1. Calculate how much you will see on your paychecks going from monthly to bi-weekly pay periods.  The City has provided an easy calculator called the Bi-Weekly Net Pay Estimator that will give you an idea how much each paycheck will be.  You can find this calculator under the link, "Employee Toolbox."
2. Review the due dates for your fix expenses, such as auto loans, credit cards, insurance, utilities, etc.
3. Using the information from the above two steps, determine if you have a cash flow issue and how big an issue this will be to your family income. You can prepare for any potential cash flow issues by considering the suggestion in Step Two.

Step Two - If you have a projected cash flow deficit, the following options may assist:

1. Create a "necessities budget." This is a budget based on what you actually need for you and your family to survive.  This helps make it clear as to what your financial needs are and what you are capable of saving.  This would include the minimum payments required for your debt obligations.  If you need some suggestions of how to do this, please see the Budget Considerations pages.
2. Rank your fixed monthly expenditures in order of importance. If money becomes extremely tights, then rank all of your expenses in order of importance.  If you need some suggestions on how to do this, please see the Budget Considerations pages.  This is a great exercise do to for many reasons.  It helps you to know who to pay first when money flows in.  You might want to decide if you want automatic withdrawals in your account.  While it may appear simpler, you can have less control over your money.  Also, take a look at the very bottom of the list.  May be the last five items on your list could be cut out altogether as they are not as important.
3. Check with your bank to see if they offer a "skip a payment" program for your car loan. Many credit unions and banks offer these types of programs, typically around Christmas, but may be willing to offer this benefit earlier in the year.
4. Contact your banking and lending institutions to change your due dates. Many banks offer this benefit.  However, remember that your new pay dates will be different each month - they will be every other Wednesday.
5. Change your monthly draw amount with a goal of an amount less than 10%, or even better, zero. If you receive one, your draw amount is what you receive on the 25th of each month.  The smaller this amount is, the larger the amount paid on the 10th.  During July, the transition month to bi-weekly pay, this would result in a large paycheck on the 10th plus a bi-weekly check on the 25th.  If you were able to achieve a zero draw amount, then in July you would receive your entire monthly paycheck for June on the 10th, plus a bi-weekly paycheck on the 25th - effectively at 46% monthly increase to your cash flow.  This might be sufficient to carry you through until October when you receive 3 bi-weekly paychecks.  If you would like to decrease your mid-month draw, the City has a "Mid-Month Reduction Form."
6. Determine how much you want going into your deferred compensation contributions. There are two reasons you may want to change your deferred compensation contributions to either your 457 plan or your 401(k) plan.  If an employee's contribution is a set dollar amount it will need to be converted to it's bi-weekly equivalent.  To calculate the bi-weekly equivalent the current monthly amount is multiplied by 12 then divided by 26.  For example:  If the monthly contribution amount is $100 then the bi-weekly equivalent is $100 x 12 / 26 - $46 per bi-week. Changes can be made through the Employee Self Service link on the Inside page of the City's website under Savings Plans.
7. Begin saving 3.5% to 5% or more every month before the move to bi-weekly paychecks. For example, if your monthly take home pay is $2,500, then a good goal would be to save at least $87 to $125 per month from March through July.
8. Alternatively, try reducing your monthly expenses by 7.7%. Again, if your monthly net pay amounts to $2,500, then try to reduce your monthly expenses by $192.  In addition, obvious expense reductions (such as dining out less), some often overlook, but simple ways to achieve could include:
   
   • Car Insurance- If you haven't shopped around for car insurance in a couple of years - it may be worth your while. You could several hundred dollars a year by shopping around.
   • Cell Phones- Review your most recent cell phone bills and understand what you are actually paying.  Are you paying for internet service that you are not using?  Are you paying for 1000 minutes a month, when you are only averaging about 350?  Are you paying for text messages that you are not using?  Before you call your cell phone company, check other cellular companies to see how their rates compare. If it is still worth your while to stay with your current provider, then call them up and talk to them about the changes that you would like to make.
   • Home Phone Lines- Do you really need a land line?  Would it be possible to use your cell phone for all calls?  If you have a land line solely for the purpose of having a DSL internet connection, try calling to phone company to adjust your phone plan.  A pay-per-call plan could reduce your bill by as much as 70%.

It is ultimately up to you to decide what to do, but it is recommended that you understand the financial impact of moving to bi-weekly pay and we encourage you to get the information you need to make informed decisions.  We are here to help.