How To Save Money The Japanese Way!

 According to research, the Japanese way to save money is called Kakeibo. Japanese people use this method in every family and it means “household account book”. It works very simply. No applications, no technology and no complicated Math is required, all you need is a notebook and a pen.

 “And I just love this Kakeibo method because it's not intimidating and it's something that any of us could try.” Lisa says.

“I have more control over my money in the sense of my own spending habits” Albert Stephen says.

Before we see how it works? A question comes to mind: why should we trust Japanese people? We know Japan for being a king of innovation and one of the richest countries and one with the highest living standards but what many people don’t know is that Japan was one of the poorest countries after World War II. They were one of the biggest debtors of the World Bank. This affected every Japanese household. People were very poor. And that is when this method was introduced.

While kakeibo is still new-ish in the United States, it’s a tradition in Japan. Japanese journalist Hani Motoko wrote about the method in a 1904 women’s magazine. The kakeibo accounting system appealed to her readers, Japanese housewives in charge of their household budgets. 

When writer Fumiko Chiba published the guide “Kakeibo: The Japanese Art of Saving Money” in 2018, the trend took off in the West.

According to Chiba and other experts, kakeibo reflects Japanese cultural beliefs about the importance of saving money. Cash plays a ceremonial role. Children receive money as a holiday gift and they’re encouraged to hold onto the cash for purchases that are worth it.

Adults don’t take money lightly either. Compared to other countries Japan has a cash-heavy economy; credit cards, which enable frequent, big-ticket spending, aren’t swiped nearly as often as they are elsewhere. Since then this simple Japanese method that makes people 35% richer over time revolves around four questions.

How much money do you have? How much would you like to save? How much do you spend? How can you make things better?

It is so easy but the trick is to track how much you earn and spend in detail and write it down using a pen and paper always consistently no matter what. Track your spendings.  The best way to teach people critical thinking, and is to teach them to write, while the hand empowers the pen, the pen empowers the man. Research has proven again and again the benefits of writing your finances by hand. It helps you to be more present and aware. It helps you to become completely honest about your needs and wants. It helps you become more self aware instead of being image-conscious and when Japanese people realize that this actually works. The government made it a priority. The media highly endorsed it. It became a necessity in every household and parents passed it onto their kids at an early age, a part of their culture like a household culture. Because a messy room is like a messy financial situation and when your room is organized and clean, you can easily manage your items and know where everything is.

 Kakeibo specifies four “pillars” or categories of spending:

Needs: the essentials like housing, groceries, car payments, or student loans.

Wants: enjoyable but not totally necessary purchases (takeout food, hobbies, entertainment).

Culture: any spending on cultural activities — books, museum fees, concert tickets, TV streaming services, etc.

Unexpected: other expenses that crop up, like medical bills or home repairs. 

Record all your purchases under their appropriate “pillar” and include the purchase amount.

The Kakeibo method can make you richer. If we look into this method by islamic point of view, we come to know that the Quran also puts emphasis on this point and teaches us that everything related with trade or finance should be written down so that all expenditures can be managed easily and Japan is also using that method in the Kakeibo scheme. So, pick up a pen and a notebook and track your finances. If you do this everyday, you’ll have much more than money and you will find peace of mind that money cannot buy.