Many of us make a resolution at the start of every month: "Somehow, I will save some money this month." But by the end of the month, we find our pockets almost empty. It's not major luxuries, but rather small, frequent expenses that swallow the entire salary—impromptu dining out, buying favorite clothes, or children's toys. Dreams of savings are lost in these. However, there is a solution in Japan's century-old method: 'Kakeibo'.
What is Kakeibo?
The word 'Kakeibo' (家計簿) means 'household account book'. It is a method of financial awareness where all family or personal expenses—grocery costs, market trips, medicine, school fees, utility bills—are regularly recorded.
This concept was introduced in 1904 by the Japanese journalist Hani Motoko. Her goal was to teach people how to consciously plan expenses and save money.
The Core Philosophy of Kakeibo
Kakeibo teaches that saving is not what's left after spending, but part of the spending.
In other words, it's not "save what remains," but rather "spend what remains after saving."
For example: If your income is $30,000 and you want to save $3,000, immediately set aside the $3,000 as soon as you receive your salary. Then, plan your entire month's budget with the remaining $27,000.
5 Steps to Follow Kakeibo
1️⃣ List Monthly Income and Essential Expenses
First, write down your total monthly income. Then, list your fixed expenses—rent, groceries, bills, school fees, etc.
2️⃣ Treat Savings as an 'Essential Expense'
Determine how much you will save each month and deduct it right at the start.
3️⃣ Record Daily Expenses
Write down expenses in a notebook, not on your phone. For instance:
August 2 – Coffee $200, Electricity Bill $800, Groceries $1,500.
Writing it down this way fosters awareness about the value of money—this is the real magic of Kakeibo.
4️⃣ Divide Expenses into 4 Categories
Essential Expenses: Food, Rent, Bills, Transportation
Optional Expenses: Clothing, Restaurants, Entertainment
Investment in Self-Improvement: Books, Courses, Movies
Extra or Emergency Expenses: Medical, Gifts, Festivals
5️⃣ Review at the End of the Month
At month's end, tally the accounts: Did you meet your savings goal? Where were the unnecessary expenses? How can you reduce them next month?
Saving Starts with Awareness
Kakeibo is not just a financial strategy; it is a mental exercise. It teaches the habit of gaining control over your money.
You can also incorporate two additional strategies:
Pareto Principle (80/20 Rule): Identify which 20% of your spending areas account for 80% of your total costs, and start making cuts there.
'Muda' Principle: According to this Japanese concept, eliminate unnecessary expenditures—such as unused subscriptions, excessive tea/coffee, etc.
Final Word
A century ago, Hani Motoko showed that saving begins with record-keeping and awareness.
Kakeibo reminds us even today:
"Keep accounts, be aware, save money.