You can choose to receive subsidies in twelfths: But what does that mean?

Government wants workers to be able to choose whether they want subsidies in twelfths.

Workers will once again be able to choose whether they want to receive the holiday and Christmas allowances in twelve installments, according to the Executive Program already delivered to Parliament. But what does this mean?

What does duodecimos mean?

Receiving subsidies in twelfths means that you will start receiving holiday and Christmas bonuses in installments .

Instead of receiving both subsidies at once, you receive them distributed throughout the 12 months of salaries.  

Note that the vacation allowance is usually paid in June and the Christmas one in November/December.

But with the duodecimal regime, workers will be receiving parts of that amount together with their salaries, making the monthly compensation higher.  

What is the government's objective with this measure?   

In the program presented, the Government clarifies that the objective is that "each worker should again have the prerogative of choosing how they want the subsidies (13th and 14th months) to be paid to them: in full at two moments of the year or in twelfths, that is, spread over 12 months of the year".

What are the advantages and disadvantages of twelfths?  

According to News at the Minute, which quotes the Santander's Jump blog, these are the advantages and disadvantages of this regime:

Advantages

• "More monthly liquidity. Receiving subsidies gradually increases the value of the salary every month, which can help balance accounts better and face regular expenses."

• Greater financial stability. Monthly income becomes more consistent, facilitating financial planning, especially useful for those who prefer predictability over sporadic inflows of money.

• Avoid impulsive expenses. When receiving a large amount all at once, there is a greater tendency for impulse spending. With the twelfths, this risk is reduced.

• Improvement in management for companies. For employers, this modality allows spreading the costs throughout the year, which helps in cash flow control.

Disadvantages

• "Less slack at key moments. If you usually rely on subsidies to pay for holidays or Christmas gifts, you may miss that 'bonus' at those times."

• Difficulty in making larger investments or payments. Receiving in twelve equal parts can limit the ability to make large purchases or save all at once;  

• Loss of symbolism. For many people, Christmas and vacation bonuses carry emotional weight, and this impact is diluted with this payment model.

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