InfoSearched
Published -
- September 14, 2019
- 12:59 pm
We all know how money has a magical ability to disappear overnight, right after payday.
But it looks like the Japanese know the secret to make it stay in your wallet longer, and even multiply there. Today, their method of budgeting is growing popular all over the world.
A hundred years ago, Japan was a traditional agricultural country – nothing like how we know it now. How did it manage to become the most technology-savvy country, with a developed economy and one of the highest living standards? One of the reasons is the high financial competence of the Japanese themselves. They’re experts in personal finance. They use Kakeibo. So what is it?
What are the benefits of using the kakeibo method for personal finance management?
A Simple Japanese Money Trick to Become 35% Richer
Japan is known for its innovative insights, unique cultural practices and impressive technological advancements. In the field of personal finance, the Japanese have a few tricks up their sleeves as well. One such trick, which is said to increase savings by as much as 35%, is known as kakeibo.
What is Kakeibo?
Derived from the Japanese words “kake” meaning “to account for” and “bo” meaning “book”, kakeibo is a traditional budgeting and saving method that came into existence more than a century ago. It is essentially a budgeting journal or a workbook that helps individuals keep track of their personal finances by writing down their expenses, savings and spending goals regularly.
Unlike modern budgeting applications, which can be too complex and time-consuming for some people, the kakeibo method is simple and straightforward. It involves writing down all expenses in a notebook or planner, which can make it easier to visualize your spending habits and adjust accordingly.
How to Use Kakeibo
The kakeibo method requires four simple steps:
1. Set a monthly savings goal: Before you start tracking your expenses, set a savings goal for the month. This will help you stay focused on your financial goals while planning your expenses.
2. Record all expenses: Write down all expenses in a dedicated notebook or planner. Categorize expenses as fixed (rent, utilities, etc.), intermittent (groceries, car maintenance, etc.) or non-essential (eating out, shopping, etc.). Make sure to record every expense, no matter how small.
3. Reflect on your spending: At the end of the month, review your spending habits and identify areas where you can cut back. Reflect on your goals and see how much progress you’ve made towards achieving them.
4. Plan for the next month: Use the insights gained from the previous month to make a budget for the next month. Adjust your expenses and savings goals accordingly to stay on track.
Benefits of Kakeibo
The kakeibo method has several benefits that make it an effective budgeting tool. Firstly, its simplicity and visual approach make it easy to understand and follow through. Secondly, it promotes mindful spending by encouraging individuals to think about their financial goals and priorities. Thirdly, it can result in significant savings over time, enabling individuals to achieve their financial goals faster.
Conclusion
Kakeibo may be a simple, traditional money trick, but it is still effective in the modern age. It helps individuals gain control over their finances, develop mindful spending habits and achieve their financial goals faster. With its four simple steps, anyone can start using this method today to become 35% richer over time.
