Lesson 25 of 25 · 8 min
What a buffer does to the delinquency clock
A buffer does not move the due date; it changes whether that date is reached with cash still there.
A $2,762.47 month against a $12,480 buffer can miss zero of the 30/60/90 clock because the cash is there. A $2,762.47 month against a $1,800 buffer cannot cover the month; the clock starts on the first missed due date. The buffer does not change the due date. It changes whether the due date is reached with cash still in the account.
Track 9 lesson 6 is a cure window: a stated number of days that may exist after a comparison has already failed. The 30/60/90 delinquency buckets are that window written as aging. Thirty days late is a category; sixty is another; ninety is another. Lesson 10 already treated a 30-day late as a category change in payment history. This lesson is the cash that decides whether that category is reached. Reporting and aging rules vary; a reader's own situation belongs with a qualified professional.
Against $12,480, the $2,762.47 leaves $9,717.53. The due date arrives and the cash is still there, so the aging clock does not start. Against $1,800, the $2,762.47 does not fit: gap $962.47. The due date arrives the same day it was always going to arrive. The clock starts because the comparison failed. Track 1 lesson 7's cushion is the $12,480 expressed as 4.52 months. Track 9 lesson 6's days are what begin when the cushion is smaller than the month.
What the buffer does and does not move, on these two invented months:
- It does not move the due date. The due date is a term of each agreement.
- It does not rewrite 30/60/90. Those buckets age from the missed date.
- It changes whether the due date is met from cash still in the account.
The buffer is headroom against the delinquency clock. The clock is a cure window. The due date is not the buffer's to move.
Key terms
- Delinquency clock
- Aging from the first missed due date, commonly spoken as 30/60/90. A cure window. Rules vary; a reader's own situation belongs with a qualified professional.
- Due date
- The day the agreement names. The buffer does not move it. Cash against the stack decides whether it is met.
- Missed due date
- The comparison that starts the clock: the month's claim against cash that does not cover it.
Worked example
One stack, two buffers, one due date
Monthly stack $2,762.47. Due date unchanged. Buffer A $12,480. Buffer B $1,800. Aging rules vary; a reader's own situation belongs with a qualified professional.
- Due date
- Unchanged
- Buffer A after the month
- $9,717.53
- Buffer B against the month
- Gap $962.47
- 30/60/90
- Ages from that miss
- What 4.52 months was doing
- Headroom
The buffer does not write it.
$12,480 − $2,762.47. Clock does not start.
$2,762.47 − $1,800. Clock starts on the missed due date.
Track 9 lesson 6's window, as buckets.
Track 1 lesson 7's cushion, in time.
The due date is the same in both pictures. $12,480 meets it. $1,800 does not, and the aging clock starts there.
Check yourself
A $2,140 month sits against $8,640 in one picture and against $1,500 in the other. The due date is the same day. Which picture starts the 30/60/90 clock, and what does the larger buffer change?
A savings buffer is headroom against the delinquency clock, which is a cure window — Track 1 lesson 7's cushion, Track 9 lesson 6's days. Open The cure window, and whether it exists at all →
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Educational only. Nothing in this lesson is investment, legal or tax advice, or a recommendation to enter into any transaction. Figures are illustrative and computed from the inputs stated in the lesson.