Kakeibo is the art of mindful budgeting.
The first step is to track expenses to establish a baseline. It’s best to start with a month of data, and then move into answering the remaining budgeting questions.
With the captured data, it can then be categorized to identify opportunities:
- General household costs (essential)
- Unexpected costs (essential)
- Leisure (nonessential) like entertainment or shopping
- Culture (nonessential) like haircuts and news subscriptions.
Some nonessentials are effectively essential and that’s okay, just budget for them. This is an ongoing activity that should occur weekly and monthly. Goals may now be set, with a hard target amount and timeline. All that’s left is to approach spending with mindfulness (and to continue logging and reviewing). In support of that, it’s important that this all takes place on paper—handwritten journaling increases mindfulness.rB2
Abigail Bassett, “The Art of Kakeibo, the Japanese Budgeting System That Could Change Your Financial Life,” Pocket (blog), February 3, 2020, https://getpocket.com/explore/item/the-art-of-kakeibo-the-japanese-budgeting-system-that-could-change-your-financial-life. (See notes.)