Question about messing up age of money

So I started the new ynab about 6 weeks ago.   I had gotten my age of money up to 14 days and was feeling good.   Then I get rent money in from land we own.   We get this payment twice a year and its a good amount.   However it is used up right away to pay for the land taxes and for a loan we have against the land( loan is set up for every 6 month payments since that is how we get the land rent).    So basically we get this money, and the same or next day, I pay the loan and taxes.  No use having it sit around and chance spending it!    So once I took care of this my age of money dropped down to 3 days!      Now I realize in the big picture of things, the age of money number doesn't matter.  But it was a nice little indicator that I was on the right track.   So in 6 months is it going to drop drastically again?   Is there anything I can do?  

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  • No. This is the Rule 2 problem with Age of Money. You save up over time for true expenses, and then when it comes time you pay them. Since they are larger expenses that occur infrequently, they will cause a drop to AOM.

     

    In short, AOM is a useless curiosity and non-actionable.

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  • Hi Denise !

    Age of Money calculates the average number of days between when you receive money and when you spend it. Said another way, it is the average age of the money of your last ten cash transactions. Older money means taking longer to spend the money you receive, so receiving large lump-sums for immediate obligations can cause that number to drop. 

    When starting out, it's a great way to monitor how you're stretching the funds you receive. It'll bounce back as you continue to follow the YNAB rules. :)

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