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'Kakeibo’ is a Japanese budgeting system which helps you clamp down on your spending. Here’s how you can use it to kick off your 2020.

Sharon Masige
  • The Japanese method of Kakeibo teaches you to save money through a series of reflective questions.
  • Kakeibo helps you mindfully manage your budget each month by asking you how much money you are spending and how much you would like to save.
  • It also helps track your spending by organising your purchases into four key categories.
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While there are a number apps you could use to help you keep track of your finances, this Japanese method uses the humble pen and paper.

The Japanese word 'Kakeibo' means "budgeting journal" and is a method of managing your finances by pen and paper, through a series of questions.

Its origins date back to 1904 as a way for housewives to manage their budgets. In 2017, author Fumiko Chiba released the book "Kakeibo: The Japanese Art of Saving Money", a year-long journal that serves as a guide to Kakeibo.

The book encourages you each month to "think mindfully about how much you would like to save and what you'll need to do in order to reach your goal." By ditching apps or complicated maths calculations, it encourages a more personal approach to saving. It asks you a series of questions for you to reflect on your spending each month.

Rather than focus on things you can't spend on, the book pinpoints things you value and spend on.

How it works

The "kakeibo cycle" breaks down your budget each month into four main questions:

The fourth question is a major factor as it encourages you to reflect on your spending with deeper questions:

Since you're answering the same questions each month, you can adjust your spending habits as you go, instead of sticking to one method that may have worked months ago.

Keeping track of your spending

Kakeibo also has a plan for keeping track of your spending. It separates where you spend your money into the four categories of 'survival' – essential items such as utility bills and groceries – 'culture' – such as books or going to the theatre – 'extra' – one time purchases like gifts, and 'optional' items that you could cut out if you wanted.

With only four categories, the Kakeibo system causes you to think critically of how you define and justify your spending.

So why not try reflecting on your spending to see if it helps you become a better saver.

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