Kakeibo : The Japanese Way of Saving Money

Invented in 1904 by a woman named Hani Motoko (notable for being Japan’s first female journalist), Kakeibo is a simple, unadorned approach to managing your finances.

For the past 116 years, Kakeibo has been effective in helping people make smarter financial decisions.

No technology—just a notebook and pen

Source : Google

Kakeibo a minimal journaling approach to managing your incomings and outgoings.

It helps you keep an eye on hidden and unnecessary expenses you can cut to save or invest.

Like all budgeting systems, the idea behind kakeibo is to help you understand your relationship with money by keep a ledger of everything that is incoming and outgoing.

The main principles of kakeibo are to separate your finances into 4 categories:

  1. Need: items like food and bills that are necessary for your day-to-day life (by necessary I mean electricity and phone costs, not the four take-away coffees you think you require to get through those afternoon meetings!).
  2. Want: purchases that aren’t a necessity like take-away food that could potentially be counteracted with a bit more mindful thinking.
  3. Culture: items like museums and books, underlining the importance for those aspects that provide a certain quality of life
  4. Unexpected: expenses that weren’t anticipated like a doctor’s appointment or a mechanic

“The simple act of completing your kakeibo each week or month ensures that saving is a part of your everyday life, while also giving you the opportunity to reflect and improve your finances”

When you choose the Kakeibo budgeting method, “Think about your ‘musts VS wants (ie your optional category.)

Before you spend, pause to consider whether or not you need it or want it.

Answer The kakeibo method’s list of questions before going through with any purchase:

  • Can I live without this item?
  • Based on my financial situation, can I afford it?
  • Will I actually use it?
  • Do I have the space for it?
  • What is my emotional/mental state today? (anxious, bored, relaxed, hungry?)
  • How do I feel about buying it? (Happy? Excited? Doubtful? Indifferent?)
  • How long will this feeling last?

It’s important to note that kakeibo isn’t designed to cut all joy out of your life.

If you’re feeling glum about something, then flowers are a fairly inexpensive way to cheer yourself up.

Rather than requiring you to do anything drastic, the goal is to change your bad financial habits through mindfulness and incremental changes.

Different categories of finances

The Bottom Line

The philosophy can be easily applied using a regular bullet-style journal by following the principles above.

The key is to write down everything — which aids in remembering and staying accountable to yourself.

Alternatively, pre-printed kakeibos are available to purchase and fill in. Fukimo Chiba’s Kakeibo — The Japanese Art of Saving Money’ is a simple option.

Kakebo isn’t just about finances — it can help you develop self-awareness, self-discipline, and promotes peace of mind.

The Kakeibo Questions
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  1. That’s a very informative & well explained article. Totally trying this going forward. Thank you so much.

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