Learn from the Japanese: 6 Saving Methods to Build Your Savings Faster
JAKARTA — CNBC Indonesia — It is no secret that Japanese society is known for its strong discipline, particularly in financial management. The habit of living frugally, orderly, and with careful planning enables many Japanese citizens to maintain financial stability despite the country’s high cost of living.
This practice, known as kakeibo, is a key philosophy of frugal living in Japan. It is a renowned financial management method widely used by Japanese housewives. Introduced in 1994 by journalist Makoto Hani, kakeibo was popularised again in 2017 through Fumiko Chiba’s book Kakeibo: The Japanese Art of Saving Money.
Like all budgeting systems, kakeibo’s core idea is to help individuals understand their relationship with money by tracking all income and expenditures. However, unlike digital tools such as apps or Excel spreadsheets, kakeibo emphasises physical writing as a meditative practice to process and observe spending habits.
According to kakeibo, individuals should ask themselves the following questions before purchasing:
Can I live without this item?
Given my current financial situation, can I afford it?
Will I actually use it?
Do I have space for it?
How did I first discover this item? (Did I see it on Instagram? Or find it while wandering a mall out of boredom?)
How am I feeling today? (Calm? Stressed? Relieved? Feeling down about myself?)
How do I feel about buying it? (Happy? Excited? Indifferent? And how long will this feeling last?)
Kakeibo also teaches effective saving methods for financial management, as follows:
- Record all income
The first step is to document all monthly income, whether regular salary or additional earnings. Kakeibo recommends writing this down with pen and paper to fully internalise the information.
- Save first, then allocate funds
Kakeibo advises setting aside savings before distributing the remainder into expense categories. The method divides expenses into four categories:
Survival: essential needs like food, bills, loans, and other obligations.
Optional: secondary needs such as entertainment and dining out.
Culture: expenses for knowledge enhancement, e.g., books, films, magazines.
Extra: miscellaneous spending like gifts for friends’ birthdays or condolences for neighbours.
- Wait 24 hours before purchasing
Japanese individuals typically take time to consider purchases. Avoid buying items immediately after seeing them; instead, wait a full day to determine if it’s a genuine need or mere desire. If you still want it after 24 hours and your finances allow, proceed with the purchase.
- Regularly check bank balances
Frequently reviewing account balances helps manage finances by keeping track of available funds and controlling spending.
- Keep reminder notes in your wallet
A useful trick is to place a note in your wallet asking, “Do you REALLY need this item?” This ensures constant reflection before making purchases.
- Use cash for transactions
Debit or credit cards can obscure spending amounts. Using cash makes you more aware of how much you’re spending during purchases.