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Kakeibo: Budget With The Kakeibo Method

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What is Kakeibo?

Directly translated it's a Japanese word that means “household account book.”

If you're struggling with the pronunciation- let's address that straight off the bat. “Kakeibo”- is pronounced “kah-keh-boh”.

The kakeibo method is a way of tracking your finances manually- with the good old pen-and-paper combination. The intention is to help you stick to a budget, become more conscious of your spending, and reach your savings goals.

What makes this method so effective is that you practice an element of mindfulness when it comes to your personal finances.

We'll talk more about the budgeting technique in a minute, but the practice of kakeibo is so powerful because it is rooted in clever questions, in addition to addressing the numbers.

Here is an indication of some of the questions you can ask yourself when you go shopping. Kakeibo thinking empowers you to address the "why" behind your purchases.

How To Implement The Kakeibo Method

The kakeibo method starts each month by:

  1. Recording fixed income

  2. Recording fixed expenses

  3. Setting a savings goal for the month

  4. Identify the cash you have available for the month.

Then, throughout the month, you record your expenses, on a daily bases, into four categories.

The Four Kakeibo Expenses Pillars

  • Survival expenses

  • Optional expenses

  • Cultural expenses

  • Extra expenses

To get a deeper understanding as to what these kakeibo expenses entail, you can get access to a free snippet to my personal finance short-course that further elaborates on them.

Click here for the best Kakeibo journal on the market from Amazon:

At the end of every day, you will write down the expenses you incurred that day.

This is powerful because at the end of the week you will see what made up most of your expenses that week.

You will then document the answers to the following questions at the end of every week:

  1. What was the biggest expense category?

  2. Did you expect it?

  3. Can you cut back on any expenses?

Kakeibo Method Monthly Check-In

At the end of the month, you will be able to identify what purchases are costing you the most. You will also document your answers to the following questions:

  1. What was the biggest spending week?

  2. Did you expect it?

  3. How much money do you have left?

  4. How much did you save?

  5. Did you reach your goals?

Where Do You Record Your Information?

Many beautiful kakeibo bullet journals have presented what you need to complete in a work-book-style format.

The perks of purchasing a book is that it is aesthetically appealing. For some, the additional detail of associating budgeting with beauty is the push they need to keep returning to the new budgeting habit.

There are also free templates available for you to download, print, and file as you wish.

As mentioned earlier, the DIY option is available to you too.

All you need is a notebook and a pen. The video below shows you how you can create your very own kakeibo journal.

Kakeibo In Practice

I have interviewed Davin, from Austalia on his experience of using Kakeibo for the past 10 months. This interview will give further insight into the Kakeibo experience

Where did you first learn about the Kakeibo method?

I came across it whilst I was looking at different types of budgets online.

For quite a while, I had been budgeting using an Excel spreadsheet and while that was OK,

I think I overcomplicated it as I basically adapted how I developed and used that spreadsheet based on how I managed a cost center at work, quite a few years ago.

Once I came across kakeibo, I started to delve deeper into how it is used.

What was it about the method that made you want to try using it?

It is simple. But it’s that simplicity that makes it powerful.

I also really liked the fact that the focus is on meeting your needs and your saving. Building up our savings has become a big goal in my family.

Because kakeibo has such a strong focus on saving, I find it really easy to hit that target almost every month and that helps with the level of satisfaction. I think most people find budgets (in general) boring and that’s a shame.

It’s really easy to just focus on spending and just not get anywhere with your finances – and I know because I was one of those for most of my life!

Having a simple process like kakeibo allows you to use budgeting as a tool to focus on your financial goals.

When you start hitting them, that’s a powerful incentive to keep you on track to meet those goals.

The fact kakeibo is used by most Japanese households and that Japan has the highest level of household savings really supports that kakeibo works.

How simple was it to get to grips with the method?

As a process, it’s really simple. I haven’t found it to be difficult at all.

Did you purchase a book, or did you create your own journal?

I did go looking for a book as I would have liked to have one to start with, but couldn’t find one in the shops that I went to in the city.

I did find online a PDF template which was quite good and that was really helpful as I printed that out and it was a very good learning experience for the first few months.

I kept those sheets in a folder as I used them.

Now, I’ve got my own journal. I bought an 8 money column journal which allows me to record a month on two A4 pages.

On the right-hand side, I record my transactions and on the left page, I have everything else – expected income, monthly known expenses, savings goals, summary, and everything else.

There’s still space for reflecting and planning what I can do to improve on in the next month. I’ve been using that journal since the start of this year.

What has been the biggest benefit of using the kakeibo method?

My savings rate has gone way up. Using my old budget approach, I wasn’t bad at saving, but I was really only saving about 15 or 20% of my take-home pay.

Now, I target saving 40% of my take-home pay. Looking over my journal, the worst month has been 37% and the best month 54%.

That one month has been the only time I haven’t hit my target.

Have you encountered any challenges using the kakeibo method?

A couple.

Firstly, there aren’t a lot of resources in English online or on YouTube which isn’t a big deal but would have been nice. I would have liked to have been able to find a few more examples to help me in designing my current journal.

The next biggest challenge I found was keeping track of my weekly spend – so I added a running balance very early on when using kakeibo. That has really helped – but I haven’t found any example anywhere online (in any language) which uses such a total.

That’s a shame because that is the easiest way I’ve found to keep on track.

At the end of the week, I use that end of week position and add or subtract it from the next week’s amount. If I underspend, I add what I hadn’t spent to the next week, or if I overspend it comes off the next week. I’m sure that in more than a hundred years, there have been other minor tweaks and it would be good to see examples of those.

Have you shared the method with family or friends?

Yes. My wife and eldest daughter (18) are also using kakeibo.

Both are relatively new to budgeting, so I’ve started them using the printed sheets I used to use. My wife and I are likely to start a combined household budget later this year. They’ve been using kakeibo for only a couple of months

What has their experienced been using it?

Pretty good. My daughter is using the process without much of a plan for her finances, but she definitely likes having her savings build.

My wife is also enjoying it, and I think she now has a stronger focus on saving. To be honest, she was much like I was when I didn’t use any budget, although she didn’t get into any debt unlike I did! She also likes that there isn’t any judgment if she goes over her budgeted amount. It just means a little extra focus the following month!

Who Would Benefit From The Kakeibo Method?

Those who have a financial plan and goals would really suit this method as that indicates that a person likes a bit of structure.

You also have to be a bit methodical in that you need to record your transactions. You can do this either at the time of the transaction, or that evening (and I have seen some kakeibo journals in Japan where people don’t even do that – but tape in their receipts!).

I also think a stable income is a benefit. It’s not that those with irregular income wouldn’t benefit, I just think it’s easier if you have a stable income.

Who Would Not Benefit From The Kakeibo Method?

Personally I think everyone and each household would benefit from kakeibo!

I think the type of person who just wants to spend their money and has little interest in where it goes wouldn’t benefit as much as they could have, but that’s just my opinion.

When I first came across kakeibo, there was a story of how Japanese husbands are given an allowance (called okozukai) by their wives as household budgets are generally controlled by women. The article mentioned that a man complaining that he had asked for a higher allowance and his wife refused it. I think he would say that he doesn’t benefit from kakeibo!

Thanks, Davin for taking the time to answer all out Kakeibo-related questions!


Kakeibo is for the beginner, taking control of their finances for possibly the first time, or at least, for the first time in a while. It is also for the person who, no matter what their budgeting expertise, would rather slow things down and practice mindfulness in their personal finances.

Also, People who find that manually budgeting serves them better than plugging information into an app or spreadsheet would benefit most from using the Kakeibo Method.

It can empower those who have previously felt levels of self-doubt when it comes to addressing their finances.

People who may have had a bad experience with accounting at school, or a partner speak negative words over their ability to manage finances, may benefit from this intuitive approach of budgeting as well.

Kakeibo requires diligence to return, day after day. It is not for someone, who does not have the discipline to commit to forming a new habit.

Some apps pull financial information, without someone having to put in any effort whatsoever- Kakeibo requires a more hands-on approach.

Generally speaking, it takes 21 days to form a new habit.

It is normal to go through a learning curve.

Patience, persistence, and perseverance are great characteristics to have for someone wanting to start using the Kakeibo Method.

More money isn't necessarily going to fix all your problems.

However, taking ownership of your financial situation will empower you to learn from your past and make wise financial decisions for the future.

The kakeibo method is an intuitive approach that allows you to reflect on your purchases and learn from your past purchasing behavior.

If you are a beginner, considering budgeting for the first time, the kakeibo method could be the least intimidating way to head-on face your finances.

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