What Is Biweekly Pay? A Quick Explanation

ByNikolina Cveticanin
May 10,2022

Introduction

Biweekly pay is one of the most common pay schedules used by US employers. When you apply for a job, or are considering an offer from a company, it’s useful to know how often you will get paid. In this article, we’ll provide a quick explanation of what biweekly pay is and how it works, highlighting the pros and cons.

What Is Biweekly Pay?

Biweekly pay is a common pay schedule used by businesses and organizations in the US. Understanding biweekly pay meaning is essential for employees, as it enables them to budget effectively. As employees get paid every other week on a set workday, biweekly pay means that they receive their wages 26 times per year, rather than 12. The length of the month and the way the days fall dictate whether employees get paid two or three times per month. In most cases, biweekly pay for employees means receiving payment twice a month. 

How Does Biweekly Pay Work?

Biweekly pay enables employees to receive wages every other week. The employer will choose a specific day of the week on which to pay employees. The employee will then receive their payment every other week on the specified day, with many employers choosing to make Fridays payday. In this particular case, the employee would receive their wages every other Friday. Depending on how the dates fall, in one month, an employee may get two pay packets and, in another, they may get three. 

The amount an employee earns on a biweekly payment schedule will depend on whether they are a salaried employee or an hourly one. While salaried employees will typically receive the same amount every payday, those who have an hourly rate may receive a different sum every time they get paid based on how many hours they have worked. 

It is worth noting that if you’ve only just started a new job, it may take up to three weeks to get your first paycheck even if you are paid biweekly. As most employers distribute wages a few days after a pay period, this allows them to process hours completed and deduct the relevant taxes.

What Is the Difference Between Biweekly and Bimonthly?

It is common to read about biweekly and bimonthly pay when researching jobs and looking at different payroll schedules. Despite being similar, these concepts are not the same. 

Biweekly vs. Bimonthly

Biweekly pay means that employees get paid every other week on the same weekday, every other Friday, for example. Bimonthly pay, also known as semi-monthly pay, means that employees get paid twice per month. In the case of biweekly pay, the dates will differ, and there may be three paydays in one month. With bimonthly pay, employers issue wages on two specific dates every month, so that employees get 24 payments per year rather than 26. If you receive bimonthly payments, each paycheck will be worth slightly more than the value of biweekly paychecks.

What Are the Pros and Cons of Biweekly Pay?

Biweekly pay has some pros and cons compared to other payroll options, including weekly, monthly, and semi-monthly pay. The advantages and disadvantages of a biweekly pay schedule are:

Pros

  • Budgeting: biweekly pay makes budgeting easy for employees, as they know they are getting paid every other week on a set day. Employees on a biweekly schedule can plan a budget for a two-week period or a month, as they know how much money will be coming in. Budgeting may be slightly easier with biweekly pay than bimonthly pay because the days change for bimonthly pay. One payment may arrive on a Tuesday and the other on a Friday, for example. 
  • Frequent pay: one of the main benefits of biweekly pay for employees is the frequency with which they receive their paychecks. It can be less stressful to cover bills and other expenses when you get paid every two weeks rather than every month. 
  • Consistency: biweekly pay is a consistent system which is simple for employees and employers to adopt. 

Cons

  • Monthly variations: for employers and employees, biweekly payment schedules can be slightly more complex than other options because some months have three rather than two payment dates. 
  • Personal preferences: some employees may prefer to be paid weekly, bimonthly, or monthly, depending on how they budget.
Frequently Asked Questions
Is getting paid every two weeks biweekly?

Biweekly pay means that you get paid every other week on the same day. Your employer will choose a day to pay employees, and you will receive a paycheck every two weeks on the same day of the week. Biweekly is not the same as bimonthly; on a bimonthly pay schedule, employees will be paid twice per month on set dates.

How do I calculate my biweekly paycheck?

Biweekly payroll means paying employees every other week. Each employee will receive a total of 26 paychecks per year. To calculate your biweekly paycheck, you can divide your annual salary by 26. If you earn $50,000 per year, for example, you will receive a biweekly payment of $1,923 (pre-tax).

Is biweekly or monthly pay better?

Biweekly pay has many advantages for employees, but there are pros and cons of biweekly and monthly pay schedules. Some people prefer to receive paychecks more frequently as it is more convenient to budget, but others prefer to be paid monthly. It’s just is a matter of personal preference. Biweekly pay means that you receive less in your paycheck, but you get paid more often, which can be helpful when paying bills and managing household budgets. Monthly pay means that you earn more per paycheck, but you receive fewer payments. Some people opt for a monthly budget, but for others, it’s better to have more paydays during the month. 

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By Danica Jovic · April 21,2022
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The naming elements can vary depending on your location but including “Limited Liability Company” or LLC in the name will be necessary. Step 3: Complete your articles of organization After confirming that the name of your LLC is available, you must think about how to change your sole proprietorship to an LLC from a legal standpoint. The paperwork needed is known as the articles of organization and must be completed before moving on with other steps. You will need to state the name and address of your LLC, along with its purpose. You must additionally confirm whether the company intends to be managed by its members or a manager. The most important part of this step, however, is to confirm your designated registered agent. This person will become the main point of contact for interactions with state authorities. You can also opt to become your own registered agent. Step 4: Complete an LLC operating agreement Completing an LLC operating agreement isn’t a requirement in all states, but you should be prepared for this additional step when looking to transfer from a sole proprietorship to an LLC. It’s a document that deals with voting rights, distribution of profits, and exit strategies when a member is ready to leave. In most cases, the document will cover a few sheets of A4. Having a formal document to detail how all these matters will be handled can be very useful, even when the state doesn’t require it. Step 5: Complete your IRS registration When registering your LLC with the IRS, you may operate as a corporation, partnership, or disregarded entity for tax purposes. A default classification will be provided but Form 8832 enables you to change this if required. Even if you hired employees as a sole proprietor, you’ll almost certainly need to register a new EIN number to reflect your LLC. Doing this will aid your payroll, tax filing, and accessing lines of business credit. When your IRS registration and EIN number are under control, you will almost be ready to operate as an LLC. Step 6: Apply for new business licenses and permits  When transitioning from a sole proprietor to an LLC, you may also be required to reapply for various permits and business licenses. In some cases, you simply need to inform the appropriate parties of your change. Once again, it’s best to contact your local state authority to determine what action (if any) is needed following the structural change. Professional licenses, reselling agreements, and all other local permits must be covered by this process. You must not start trading under your LLC before the entire process of getting new permits is finalized. Step 7: Find new business banking solutions While it’s not necessarily a legal requirement to change your business bank account, it’s usually the best option. At the very least, you’ll need to update the bank account details to show that the company is now an LLC.  There will be the added organizational demands of informing clients, but this shouldn’t be too problematic. Your business payments and bills can be switched across automatically, but you should keep the old account open for a few days to ensure all current payments and invoices clear before closure. On a similar note, you must inform insurance companies and other relevant parties about the change of legal entity. Final Thoughts on Registering an LLC Now that you know how to change sole proprietorship to LLC entities in a quick and convenient way, you should be able to make a calculated decision on whether it’s worth the fee of $50 to $500. If it is, the steps above will allow you to do it within days. 
By Vladana Donevski · April 21,2022

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