I recently came across an article on Kakeibo (家計簿 / かけいぼ), “the Japanese art of budgeting.” Curious, I read more to learn about Kakeibo. Is there something special about this method of budgeting and managing one’s finances?
As a young adult getting into personal finance and setting myself up for smart money moves, I’ve been taking in various personal finance advice. But kakeibo is one I haven’t heard of much. I took a closer look to see if it was just the same-old budgeting advice wrapped in Japanese culture or if there was something else unique about it.
Word Breakdown
Before we get into the specifics, let’s unpack the term “kakeibo.”
家計簿 / かけいぼ / kakeibo = household budget, household account book.
家 / か / ka → house, home, family.
計 / けい / kei → plot, plan, measure
簿 / ぼ / bo → register, record book
From what I can tell, kakeibo (家計簿 / かけいぼ) is one term. You cannot take away 家 (か / ka) and end up with “budget” or “account book.”
There are a few ways of saying “account book,” such as 帳簿 (ちょうぼ / choubo) and 会計簿 (かいけいぼ / kaikeibo). “Budget” in Japanese is 予算 (よさん / yosan).
What is Kakeibo?
Kakeibo is the Japanese method of budgeting that commonly consists of writing down income and expenses in a notebook. By writing down one’s incoming and outgoing expenses, one can become more mindful about where money is going.
The four main categories kakeibo encourages people to split their expenses into are needs, wants, leisure, and unexpected costs.
By reflecting on what expenses money is going to each month, it can help people see if they are using their money the way they want to and reach financial goals.
What Makes It Different?
When I first read about kakeibo, my first impression is that it’s just a paper-and-pen form of budgeting. But here are some key differences that make it unique:
Using pen & paper helps enforce mindfulness.
Budgeting by physically writing down expenses in a journal is much slower than using spreadsheets, apps, or other digital forms of budgeting that are common today. This slower pace allows people to really reflect and be mindful about their expenses. However, the pace and manual nature of the practice may not be motivating for some.
Focus on enjoyable, mindful spending.
The focus of kakeibo is not to highlight where finances are coming short. It helps emphasize wants and how one can mindfully spend on enjoyable things. It can be a great tool to help people not only work towards financial goals, but realize what they want to use their money for.
Something I found interesting in the video I watched: the lady being interviewed talks about being able to control what you have is more important than earning more. To me this feels very different from the trending mindset we have right now in America of needing a side hustle and earning more.
Although kakeibo was not a revolutionary concept for me, it is a method that has worked for Japanese households for over a century. If you found the ideas behind kakeibo interesting, you should try it out for a bit and see if it works for you.
I encourage you to check out the video and article I read on this topic to learn more:
https://www.bbc.com/reel/video/p0g6q7wd/kakeibo-the-japanese-art-of-saving-money
https://www.sofi.com/learn/content/kakeibo-budgeting-method
