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I am going to start a new job soon where I will be go from being paid weekly to monthly.

I have several direct debits that come out of my account all through the month.

I would like to reschedule them so they are all paid at about the same time so I know how much I have to spend for the rest of the month.

When should I schedule them to come out after payday? Is a week enough to give time for a delay in salary payment?

  • In this case, why not cancel the scheduled payments and enter them yourself when the funds arrive? – user32479 Jun 11 '16 at 14:33
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    @Brick Why use direct debit at all? So I don't have to remember to make the payment for the right amount at the right time to the right account. – James Fenwick Jun 11 '16 at 14:56
  • If anyone has the slightest concern about "delay in salary payment", do not take the job! From comments below this was not James' concern, but worth remembering. – Fattie Jun 11 '16 at 21:13
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    @JoeBlow Stuff happens. If the OP's bank's computer system suddenly crashes and fails to accept payments from the employer's bank, but can still pay out direct debits (e.g. to other accounts with itself), the OP or the employer can't do anything about that situation. And if you claim that you live in a country where computers never crash, I'll reserve the right not to believe you! Of course the OP shouldn't pick up any penalty charges because of a problem like that, but if there's a simple way to minimize the hassle (e.g. "don't pay your regular bills on the same day as payday"), then do it! – alephzero Jun 12 '16 at 3:51
  • Bank glitches may delay payments by a few days. But if your salary is more than a week late, you need to start looking for another job. Because you might not get paid at all next month. – Simon B Jun 14 '16 at 21:55
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Your contract or other Ts and Cs of employment should define the pay date. Normally this would be one of:

  • Last working day of the month
  • Last calendar day of the month

In the former case, the payday is always a working day by definition. In the latter case, if the last calendar day is not a working day, the employer would normally pay you earlier to ensure the funds are cleared by the last calendar day of the month. This effectively makes the two definitions equivalent.

Assuming you are paid by direct deposit (direct transfer into your account) then this normally clears immediately, so there is no problem having the Direct Debits go out the next day. If you are paid by cheque or some other weird means, you would want some more buffer.

Speaking personally, I am paid on the last working day of the month and most of my Direct Debits are set to go out in the first one or two calendar days of the new month. Direct Debits work the opposite way in that if they fall on a weekend they will go out the next working day, not the previous. I have never once in 20+ years of working had an issue with this arrangement.

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That's a reasonable assumption. It's better to be safe than sorry and run the risk of having one or more of your bills not being paid on time.

I would ask why you would be concerned about the possibility of a "delay in salary payment", though. If you have reason to suspect your new employer won't be diligent about (or capable of) paying you on time then perhaps the bigger question would be why you'd go to work for them in the first place.

That issue aside, I assume you'll be using direct deposit, so you will know immediately if there is any hitch in your salary being paid. Having your auto payments for bills set for a week after the date you expect to be paid leaves you plenty of time to either a) resolve your pay issue with the employer before the bills come due or, b) contact your creditors to notify them of a potential problem so that you can avoid late payment fees or other issues associated with rejected auto payments.

Good thinking on your part, though.

Good luck!

  • The delay I am worried about is payday coinciding with weekends/bank holidays. I've never been paid monthly so don't know how that is dealt with. – James Fenwick Jun 11 '16 at 14:11
  • I appreciate the fact (more than you know!) that you're so forward-looking on the issue. Most people operate off of assumptions and end up with nasty surprises. – Daniel Anderson Jun 11 '16 at 14:15
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    It's also noteworthy that most employers, banks, and creditors also take this into account, and it isn't much problem, but giving yourself the extra time is a very wise move. If you continue to think in this manner then you'll avoid many of the most common money traps. Good luck! – Daniel Anderson Jun 11 '16 at 14:16
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    @JamesFenwick collisions between holidays and paydays can and do happen with any schedule. ex the most recent New Years Day was a Friday (my normal pay day). Presumably to avoid any potential issues with the holiday delaying transactions my bank account was credited on Thursday instead. – Dan Neely Jun 11 '16 at 15:31
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    Your employer might document how they determine pay day. For example mine pays on the last weekday before/including the 25th of the month. – GS - Apologise to Monica Jun 11 '16 at 17:21
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The answer will depend on your own personal circumstances, but personally I find that 7 days has worked very well in the past. It's close enough to when you get paid to give you a clear idea of your available funds for the rest of the month, and it gives you enough time (one full set of weekdays) to notice a problem and get it sorted.

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