This Japanese Budgeting System Could Be the Key to Saving Big Bucks


Forget apps that track your expenses for you. Forget Excel spreadsheets that require meticulous data entry. Forget email notifications of your bank balance.

What you need to get your bills under control, save money, and finally feel some financial peace of mind is a 100-year-old Japanese organizational system that lets you turn your financial life into a journal that doubles as a work of art.

Welcome to the mindful art of kakeibo.

What is kakeibo?

Back in 1905, Motoko Hani, the first female journalist in Japan, published an accounting book for household finances (known in Japanese as a kakeibo) in a women's magazine. Hani believed that financial stability was important for happiness, and she wanted every family to be able to get control of their finances. Some 113 years later, Hani's original kakeibo book is still sold all over Japan.

As with any budgeting system, the basic practice of kakeibo is about recording your income and your expenses. However, this program has users think about their money a little differently.

To start, at the beginning of each month, once you have recorded your fixed income and expenses, you are asked to make a savings goal for the month, as well as a promise to yourself for the month. For instance, you might make it your goal to set aside an additional $100 that month for an upcoming vacation, and you might promise yourself that you will brown bag your lunch at least four days a week.

After you have done your beginning-of-the-month accounting, goal-setting, and promise-setting, you need to record your expenses during the month. The system has you categorize each of your expenses under one of four spending pillars. These four pillars are:

  • Survival: This covers everything you need to survive, such as rent or mortgage, groceries, medical expenses, etc.

  • Optional: This is for things you don't need to do, such as restaurant dining, going out for drinks, shopping, convenience purchases, and the like.

  • Culture: This is for the costs incurred for cultural experiences, which includes your Netflix subscription, theater tickets, books, and magazines.

  • Extra: This covers any unanticipated or one-time expenses, like birthday gifts, car repairs, or furniture.

In addition to categorizing each purchase you make under these four pillars, at the end of every month you also need to write down the answers to the following questions:

  • How much money do you have?

  • How much money would you like to save?

  • How much are you actually spending?

  • How can you improve on that?

The original kakeibo books from Japan also include some fun details like images of the "savings pig" and the "expenses wolf" who are battling over your finances. Each time you track your finances, you get another opportunity to help the savings pig win out over the expenses wolf. At the end of the month, you subtract the wolf's total from the pig's total to see who won.

Why kakeibo works

You might be wondering why you would want to use paper and pen to get your finances in order when financial technology exists. As a matter of fact, there are a couple of very important benefits that kakeibo offers that no finance app ever will.

To begin with, we remember things better when we write them down. So the very act of recording your expenses in a journal means you are less likely to forget that you spent $30 at happy hour and another $40 at the movies and accidentally overdraw your account.

In addition, having to reconcile your goals and promises with your actual expenses each month will force a kind of mindfulness when it comes to spending. If you've promised yourself to brown bag your lunch at least Monday through Thursday, it will make the invitation to go out for tacos on a Tuesday less tempting because you know you will have to write it down — and face the fact that you broke your promise to yourself.

Finally, the fact that you have a physical book that shows your progress throughout each month can offer a kind of motivation that electronic budgeting doesn't necessarily provide. Not only do you have the chance to look back over your progress, but using colorful pens, markers, stickers, pretty handwritten fonts, and a pig and wolf in a pitched battle can all make budgeting something you look forward to doing instead of a dreaded chore. (See also: 6 Old School Tools to Help You Stay on Budget)

Getting started with kakeibo

While Motoko Hani's original kakeibo book is still being sold in Japan, it is difficult to find a dedicated, English-language kakeibo for American budgeters. However, this is an easy practice to fold into bullet journaling if you are already a bujo enthusiast — and an easy one to pick up even if you're not.

To start practicing kakeibo, create a monthly spread for your financial journaling. Include a spot for each of the following elements:

  • Your income.

  • Your monthly goal.

  • Your monthly promise.

  • The four pillars of expenses.

  • The four end-of-month questions.

  • The battle between the savings pig and the expenses wolf.

From there, you can have fun with the details and artwork on each monthly spread, so that you are excited to open up that page and work on it.

Sometimes the old ways are the best

While apps, websites, digital reminders, and spreadsheets all have their place in budgeting, sometimes going old school is the best way. Committing to the art of kakeibo budgeting will give you a chance to be both more mindful of your finances and make budgeting something you genuinely look forward to doing.

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