Dealing with Weekly or Bi-Weekly Payments
Not all of your debts have a simple “due date” associated with them. Bi-weekly or bi-monthly payments, for example, can be difficult to track without a little manual intervention. This post details how I handle my bi-weekly 401k loan. I get paid every other week and the payment is automatically taken out of my check. I’m not concerned as much with “due dates” because the payment is automatic and there is no way for it to be late.
The terms of the loan are for monthly installments of approximately $110. Since I get paid every other week, each check gets $55 deducted. I set the due date of the loan to be the last day of the current month, although you could choose the date of your last paycheck of the month if you wanted to. Then I set the monthly payment to $110. Lastly, each time I get paid during the month, I just enter a $55 payment for the month. Since the payment is less than the minimum monthly payment, your “next due date” should not get bumped up to the next month. Remember, you can have multiple payments for a billing month. After the last paycheck of the month, you may have to manually adjust your “next due date” to the next month.
The screen above shows how the account looks on the Debt Dashboard after one of the two payments has been recorded. Note the asterisk next to the amount in the “payment amount” field; this tells you that one or more payments has already been made and this is your scheduled remaining amount due. Also notice that the due date has not changed from the end of the current month.
Of course if you get paid bi-weekly, then you’ll have an extra two loan payments each year. I don’t bother adjusting the minimum payment for the debt for the month, I just add the payment normally and not worry about it.
This setup makes the Payment Manager on the Debt Dashboard look nice and clean. If you do it this way, these debt payments should never show “in the red” as being late.