Why I LOVE Direct Deposit

I'm not aware of any research that would indicate how most churches handle their payroll, but my guess is (just from personal experience) that most churches pay their pastors using a physical check. That's how our church operated for years. I was paid once a month, at the end of the month, by physical check for six years.

Most of the time, that process worked fine. Some months, I might get paid a couple of days before the end of the month; other months, I would get paid on the last day. However, on more than one occasion, I was paid late.

I remember one time in particular when our financial secretary had an emergency in the family right at the end of the month. She immediately left to be with her family and did not come back for a week. Since nobody else in our church at the time knew how to process payroll, what that meant for me was that I did not get paid until the 5th of the new month!

The uncertainty of this method eventually led me to begin looking into direct deposit options for our church staff. Since we use Quickbooks for our bookkeeping, we decided to use Intuit Payroll's direct deposit service. At only $1.75/paycheck deposited, it is an affordable and easy-to-use solution for churches of any size.

Now, payroll is a breeze, and we always get paid on schedule. I LOVE it.

Payroll: What Schedule Should Churches Follow?

How often should churches pay their employees? Weekly? Every two weeks? Bi-monthly? Monthly?

I don't think that there is, necessarily, a right or wrong answer to this question. It's more a matter of what is convenient and/or helpful for the employees and the church.

At our church, all employees are paid monthly on the 28th day of the month. This practice of issuing payroll at the end of the month began before I became the pastor, and so, I cannot explain why we did it this way originally. Having come from the private sector where I was paid every two weeks, it was a bit difficult to make that initial transition into a monthly pay schedule, but now that I've done it that way for ten years, I don't even think about it.

Since our church uses direct deposit to issue paychecks, I like the monthly schedule because it keeps our processing costs as low as possible. The cost to the church to use direct deposit is $1.75/paycheck. Since we have five employees, we pay $8.75/month or $105/year for this service. If we issued paychecks every two weeks, those costs would be approximately $17.50/month or $227.50/year. So, as you can see, the savings we get from paying monthly are not insignificant.

Whatever schedule your church uses, the most important thing is that you are consistent in following that pattern. As I said above, we issues paychecks on the 28th of each month. If the 28th falls on a Saturday, checks are issued on the 27th. If the 28th falls on a Sunday, we issue them on the 29th. All of our staff knows this and can plan accordingly.

This wasn't always the case at our church, and in a future post, I'll share some of that story so that you can understand why consistency in payroll scheduling is so important AND why I am such a big fan of direct deposit for church employees.

I'd love to hear what schedule your church follows for payroll. Leave a comment below or on the Facebook page.