Have you heard of Kakebo? This Japanese method helps you better manage your budget.
Keeping track of your budget and sticking to it month after month is a real struggle. With soaring inflation and additional expenses, French bank accounts have been put to the test in recent months. And the start of the school year, with its slew of planned and unexpected expenses, hasn't helped! In the age of banking apps, some old tricks are still useful for managing a budget. This is the case with this Japanese method, which originated in the early 20th century and has been brought back into fashion in recent years by specialists who praise it.
The name of the method itself says it all! Kakebo (or Kakeibo) means "household account book" in Japanese. It is a budget management method invented in 1904 by Hani Motoko. Its goal: to allow housewives of the time to take charge of household finances independently.
This method, both simple and effective, relies on the manual and regular maintenance of a notebook in which you note your income, your actual and forecast expenses. Each month, you start by listing all your expenses, dividing them into 4 main categories:
- Essential expenses (food, housing, health, transport, etc.)
- “Leisure” expenses (sports, cinema, outings, etc.)
- “Pleasure” expenses (restaurants, shopping, vacations, etc.)
- Exceptional and unforeseen expenses
Boring? No, because it's very simple to set up, especially with a dedicated notebook. You can even find some online with the categories already filled in.
Next, you define an amount to save, for example, 10% of your income, which is often recommended by banks and experts like BforBank. Then you prioritize your expenses from the most important to the least essential, allocating a budget to each. The goal is to separate the decision to spend from the act of purchasing itself, to gain perspective on our consumer behavior, which is often influenced by advertising and social media.
Throughout the month, carefully note down every expense in your Kakebo. This helps you understand where your money is going on a daily basis. At the end of the month, compare your actual spending to your planned spending, category by category. You can then identify areas where you overspent and think about ways to save for the following month.
The power of Kakebo lies in its simplicity: a notebook and a pen are all you need. No need for an app, a subscription to a paid web service, or a complicated spreadsheet. By taking the time to write down the numbers and asking yourself the right questions, you can put your finances in order. It helps you cut out unnecessary expenses without giving up all your little pleasures!
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