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Paycheck Chronicles

Heads Up for February and March Pay

With all the excitement about the last payday, on Tuesday, February 1st, I thought that I had better mention that the next three paydays are on a Tuesday.  February 15th, March 1st, and March 15th all fall on Tuesdays this year.

I have spoken with my friends at USAA and they say that they disbursed all pay on Monday, January 31st, per their policy of paying one day early.  I have heard rumors of USAA folks who got paid on Friday, but I haven't actually been able to have anyone say "I got paid on Friday."  It has all been "my friend's friend on Facebook" sort of stuff.  Honestly, if USAA says they paid everyone on Monday, I believe them until someone tells me that they actually got paid on Friday.  I feel sure that they will continue to pay on Mondays for Tuesday paydays, as is their policy.

As for Navy Federal Credit Union, I have no idea. I have heard two different stories: that they will pay a day early, and that they will pay as soon as they get the information from the Defense Finance Accounting Service (DFAS.)  Last pay, they paid on Thursday night, which was (in my opinion) ridiculous.  That is five days early!  We will have to see what they do this pay period.

Update 4 February 2011:  I have received a response from Navy Federal regarding their early release policy.  Basically, they will release pay on the day they receive it from DFAS.  However, they can not predict when they will receive it from DFAS.  Basically, your pay will come when it comes, but always at least by the actual payday.  Not very helpful for planning purposes.  You can read the complete statement at Navy Federal's Statement Regarding Early Direct Deposit.

As for other banks, I would refer to their policies on posting military pay, and your past experience with them, to guess when you might see your pay deposited.

On that note, a word about how pay gets processed.  DFAS is responsible for paying one and a half million people, twice a month.  That is a lot of people.  As you can imagine, there is no computer capable of processing that many transactions at one instant.  That is one of the reasons that DFAS starts transmitting the information to the banks days ahead of the actual payday.  The transactions get processed in batches, and the information is sent to the banks in those batches.  I don't know how long it actually takes to process all those batches, but it could be several days for all we know.  Once all the pay information has been sent to the banks, they then have to process it all through their system.  Again, this has to be done in batches, and it takes time.  Think of it like making cookies.  If you needed 500 cookies for an event, you wouldn't mix up enough batter for 500 cookies at one time and put them all in the oven to bake at once.  You'd make up one batch of cookies, process (bake) them, then start on the next batch.  Bank transactions are faster than baking cookies, but it still takes time.  This is why one customer might find their pay processed at midnight, while another doesn't see their transaction post until 3 am.  For institutions that have a lot of military customers, I think it is pretty amazing that they can process all those transactions as fast as they do.

I imagine that there is some logic to the order in which DFAS transmits pay information, and to how the banks process the batches, but I don't know what it is.  I have absolutely no reason to believe that there is any system that targets any particular group for earlier processing.  Even if there were, we are talking about hours, not days.

The bottom line is this:  the next three paydays are Tuesday, February 15th, Tuesday, March 1st, and Tuesday, March 15th.  You might get paid before those dates, particularly if you use a financial institution that pays early.  However, be smart and budget so that your can survive until payday comes.

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