In simple terms, Age of Money calculates the age of your oldest unspent dollar. If you logged $1 of new income today, how long would that dollar sit in the queue of all your dollars before it moved to the front of the line of waiting dollars and was spent.
Example: If you have $1,001 in your bank account and you spend $500 each month, by the time that last dollar was spent it would be ~60 days old. But if you spend $3,000 each month, that last dollar would be ~10 days old when it was spent.
Age of Money [AoM] is YNAB’s “upgraded” Rule 4 (which was originally Rule 1), Live on Last Month’s Income. In my experience, people have mixed (and strong) feelings about YNAB’s AoM and the switch away from Rule 1 (or “being buffered”)
However you feel about the change, breaking out of the paycheck-to-paycheck cycle and building an income cushion is desirable.
But I got sidetracked, sorry….
Age of Money displays the age of your money in days. If you turn on the Toolkit‘s Add Date of Money Tooltip setting, then hovering your mouse over the AoM display will cause a tooltip popup to appear displaying the date your oldest dollar entered your budget.
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