One of the things that I’m trying to do this month is to use a “Kakeibo” ledger to track our household expenses. Holidays, vacations, Christmas, travel, birthdays all hit this time of year in my household, so taking January to reorient (and recover) our household financial state helps us set goals for the upcoming year.
The Kakeibo method is a Japanese method popularized in the beginning of the 1900s. The word “Kakeibo” means “household ledger” which basically just means manually writing down your expenses each day in a small notebook. Each two-page spread has a weekly chart that allows you to tally up your expenses by expense category.
At the end of the month you add up the four weekly charts to get an idea of what your monthly expenditures have been. Then you either pat yourself on the back, or you stare at the figures in disbelief. Two weeks in and I’m already surprised at what I see.
The beauty of Kakeibo is that it is so manual, and it makes you think about what your writing down. Nothing against apps and digital banking, but there is something engaging about manually writing down the transactions. Just picking up your phone opens you to a smorgasbord of distraction. But when you pick up your little notebook and a pencil, there’s not a lot to distract you.
When you review your purchases at the end of the day, it takes about 5-10 minutes, and you think if you are happy about what you spent your money and time on, and if you did it again, would you spend your money on the same things? Hot chocolate with my daughter? Absolutely worth it. Paying for a second media stream service? Maybe not so much.
In a sense, this is similar to bullet-journaling. You are taking a step back, reflecting on your day, tracking what you have done, and setting goals for the future. It encourages mindfulness about what your spending your time on (especially when you think how money and time are interchangeable) and if that’s in alignment with your priorities.
Peter Drucker was right – the things that get measured get managed. [Note: Apparently Drucker never said this. Apparently a lot of people care that he never said this. Who knew this phrase was such a hornets nest? For those who are curious about this topic, here is a rabbit hole for you to dive down.)
Times up. One helpful note on saving money using Kakeibo method – don’t buy an official Kakeibo book ($$$!). Get a small notebook, big enough for a weekly spread, and save your hard-earned cash. A bullet-journal size is perfect for this activity.
Another thought – I use Kakeibo as an awareness tool, not a budgeting tool. Some people use it as a budgeting method (here’s a good example) but for our household, we have an excel-based budget, and Kakeibo is more about being aware of discretionary income.