How to buffer and keep AOM > 30 on rent
I just started YNAB a week ago and it's already completely changed the way I think about budgeting. I'm hooked!
I like both the idea of the buffer/INM category and the goal of keeping AOM >= 30 days. I already have over a year's worth of non-retirement savings, so for me the buffer would be more is more useful in the "time machine" sense. I'm fine having the buffer be 0 at the start of the month and fill up to my full paycheck at the end of it. But I'm seeing an AOM problem if I do it this way. Let's say I get paid 5K a month, split into two semi-monthly payments, and my rent is 2.5K:
Feb 14: I get paid 2.5K, goes to the buffer (Buffer +2.5K)
Feb 27: I get paid 2.5K, goes to the buffer (Buffer + 2.5K = 5K)
Feb 28: I move buffer to budget March (Buffer - 5K = 0, Rent + 2.5K, Rest of Budget + 2.5K)
March 1: Rent paid (Rent - 2.5K = 0), AOM = ~14 days
March 1-31: Rest of budget gets spent evenly, mean spending date = March 15, 3/15 - 2/28 means AOM = ~15 days
My question is, how do I resolve this problem? I see the following possible solutions:
- This isn't actually a problem; I'm looking at it the wrong way
- Start the month with the buffer full and get it to 10K by the end of the month
- Pull up the rent check from the 1st day of the month to the last day of the previous month. On a one-time basis, pay two rents in one month using a windfall. This would mean that the rest-of-budget money would be paid by the first paycheck, giving me a month's average AOM on those transactions, and the rent would be paid by the second paycheck, giving me a month AOM there as well.
Thanks in advance!
AOM does not work like that, and it doesn't matter which exact date your income has. I would advise against fudging transaction dates.
Let's say you start February 14, then all your income at that date becomes the first bucket. I'll estimate your savings to 2.5K * 14, so your income on February 14 then becomes 37.500.
Until you spend all those initial 37.500 your AOM will continually rise. Afterward, you will spend from the later income buckets, one at a time. And the shown number is an average of the used buckets.