cashflow
Invoice Aging
Tracking how long invoices have been outstanding - 0-30, 30-60, 60-90, 90+ days.
Definition
Invoice aging is the practice of grouping unpaid invoices by how long they've been outstanding - typically 0-30 days, 30-60, 60-90, and 90+. The aging report tells you immediately how much cash is at risk and where to focus collections. Healthy: 80%+ of receivables current (under 30 days). Warning: significant balance in 60-90 days. Critical: anything in 90+. Aging discipline is fundamental cash flow hygiene - businesses that don't age their AR have outstanding balances they don't even know about.
In your business
- →Run an aging report monthly - every invoice in 60+ days needs a personal call
- →Write off anything in 180+ days that hasn't moved - it's not collectible
- →Track aging trends - rising 60+ day balance is an early warning of bigger collection problems