With its roots in Buddhist thinking, Japanese culture is known for its sincere and mindful approach to life. From ikigai (finding your purpose) to ikebana (the art of flower arranging), the Japanese aim to live their lives with peacefulness and inspiration so how do we tap into it?
Luckily, Jo Peters has penned the ultimate guide in The Art of Japanese Living, including tips on mindfulness and clear thought, finding contentment, and doing more with less to help you live a rich, joyful and thoughtful life – and who doesn’t want that?
Here, Jo shares how to embrace the art of kakeibo – budgeting and saving money – to help you to take stock of your budget, understand your spending habits and, ultimately, save more money.
This is bookkeeping – streamlined. Using nothing more than pen and paper, a kakeibo (a “household finance ledger”) helps you to take stock of your budget, to understand your spending habits and to save money. The method was popularized by Hani Motoko, Japan’s first female journalist. She believed that happiness was largely dependent on your financial stability, so, to help families live better lives, she published the first kakeibo in a women’s magazine in 1904. It has since helped countless households across the country – and now the world – to tidy up their finances.
The technique is simple but effective, and it’s an uncomplicated way to feel in control of your money. As well as helping you to see the big picture of your outgoings, it allows you to prioritize what really matters to you. As a result, using a kakeibo brings an element of mindfulness to your accounts. The fact that it must be done with a pen and paper is also significant. Most of our money is intangible, rarely passing through our hands and existing only by way of credit and debit cards, so not only is there something comforting about using a pen and paper to bring a touch of reality back to your finances, but a paper ledger, as opposed to a digital one, engages your thought processes and helps you to absorb information more easily.
How to use kakeibo
The kakeibo method helps you to keep track of what you spend, a month at a time, by asking you to categorize each transaction. By the end of the month, you will have a comprehensive picture of how much of your income you spend and how you spend it. You will need an A4 piece of paper per month of expenditure. Alternatively, invest in a notebook specifically for bookkeeping. That way, all your records will be in one place. The method is made up of four questions:
How much money do you have?
Take an A4 piece of paper, or page of your notebook. At the top, write down your monthly income, minus all the fixed costs, such as rent and monthly bills.
How much are you spending?
Divide your paper up into four columns, one with each of the following headings:
- Survival: regular, necessary expenditure, such as food, childcare and transport costs.
- Culture: expenditure on cultural activities, theatre, books, the cinema, museums or magazines.
- Optional: anything you choose to spend money on, like having dinner out, social events, shopping or takeaways.
- Extra: anything irregular or unexpected, such as birthday cards/presents or repairs around the house.
Over the next month, record everything you spend in the relevant column, no matter how small. Try to be as realistic as you can; for instance, it may feel like you needed that new top or that cup of coffee, but it’s more likely that these would count as “optional” spends rather than “survival”. At the end of the month, take stock of your outgoings. How does it compare to your monthly income? Are you spending significantly more in one area than another?
How much money do you want to save?
Do you want to go on a holiday? Or would you simply like to have some spare money left over at the end of the month? Think about where you would like to be and set yourself achievable goals.
Remember to think about how you will achieve these goals too. Look at the areas where you spend the most and try to identify areas where you can cut costs. Perhaps you can pack your own lunch instead of buying it out, or visit charity shops to find second-hand books, clothes and films to enjoy, rather than always buying brand new.
How can you improve?
This is more of a question to start asking yourself once you have two or three months’ data to hand. Have you achieved your savings goals? If not, investigate why this is. Is the goal unrealistic, or is there an area where you’re still overspending? Make a new goal for the following month, making a change either to your savings goal or to your spending habits. On the other hand, if you have reached your goal, are you happy with this or do you want to save more?