Budgeting Journal for Mindful Money Management

Those of you who have followed me for a while will know how much I love the kakeibo budgeting journal. Discovering the Japanese art of mastering your money really was a turning point for me.

I learnt to see my money in a new light. No longer something scary or menacing, but something softer and infinitely more malleable. Money’s role in life cannot be overlooked, but you can develop a better relationship with your cash by learning to see it as an ally and not an enemy.

Kakeibo was invaluable in helping me see this, but it isn’t without its flaws, that is to say, one flaw in particular…

How does the kakeibo budgeting journal work?

Kakeibo asks us to consider 4 things:

How much do I have available?
How much do I want to save?
How much am I spending?
How can I improve?

The idea is you log all the money you can expect to receive in a month (such as your wages) and subtract all the money that you can expect to be going out (fixed expenditure such as bills).

The remaining sum is what you have available, out of which you decide on an amount to save and then divide all the rest into a weekly allowance for groceries, day-to-day expenses, and personal fun money.

Everything is accounted for, and a sum put away into savings every month as one of the first things you do. Regularly checking in and asking yourself how you can improve keeps you on track and on the way to saving up to a third of your annual salary!

The problem

All very well and good, except that for me, particularly in the early days, there simply wasn’t anything left having completed the first step.

Makes it kinda hard to move onto the ‘How much do I want to save’ question when you are busy wondering how on earth you are even going to be able to afford to eat this month…

Still, I liked the idea of kakeibo. I’m all about the slow and mindful – and the idea of monitoring my spending in a more thoughtful way, rather than simply number crunching, really spoke to me.

I had been trying to get a handle on my finances for a very long time – I always found it easiest to manage my monetary affairs when I made a note of what I was spending, and that is the basis of kakeibo.

However, whereas my previous style had been to jot down my expenses and monitor where I was spending and how much, kakeibo added an extra layer of depth to the procedure. Kind of a cross between budgeting and journalling, a supercharged, feel-good deep dive into expenditure.

Better Budgeting

So I stuck with it. Initially, this meant adapting the kakeibo to the best of my ability, not really saving anything, but just using it to record my expenses. As predicted, this helped. Writing down every penny I spend always helps me to see that there is actually way more money available than I had at first thought – I’m just pretty good at wasting it.

Gradually over time, I found that I was journalling much more – using the kakeibo as a way to record my thoughts about money, purchasing only what was important to me. I was still recording the facts, but also noticing the feelings that spending was invoking in me, both good (spending wisely on a quality item which brought me joy) and bad (panic buying useless tat).

With kakeibo, there is very much an emphasis on saving your money, not simply to hoard it, but to enable you to spend better. And gradually, over time, I have started making better decisions about what I spend my money on and when – I have even managed to start saving!

I can only assume that in using kakeibo I experienced a mindset shift that has knocked on somehow. Not only have I developed a better understanding of money, but also of myself and my triggers for over-spending.

How to Budget Journal for Mindful Money Management

Devote time at the start of each month to approach each of the questions in turn. I like to set aside time when I know I won’t be interrupted and make it an occasion. Light a candle, make a cup of something warming, get really comfy…

Answer the questions – write down the facts – how much money you have coming in vs fixed expenses like bills, etc that are going out. I know, sounds a lot like number crunching huh? Bear with me… it’s all about to get much more hygge…

Journalling

This is where you can get creative. The journalling aspect of kakeibo can go as in-depth or not as you’d like, it’s an extremely flexible system – if you prefer just to answer the 4 questions briefly and be on your merry way, then by all means do – but I personally believe it was the thinky stuff which made the difference for me, so I encourage you to delve a little deeper.

How much do I have available?

Admittedly not a huge amount of room for deep diving here – log all the money you can expect to receive this month – wages, tax credits, birthday gifts, etc and subtract all the money that you can expect to be going out.

However, I also like to make some notes here on potential ways I could make extra money – possessions I no longer need which I could sell, digital products I could create and sell online, any money-making ideas that I could work on during the month ahead.

This gives you focus and gets your brain in a positive creative state.

How much do I want to save?

In the original and simplest form of kakeibo you would simply decide how much you would like to save, based on the funds you have available to you. In my case this was diddly squat, so instead, I took this opportunity to think about the things I’d like to be saving for, if saving were an option for me.

Under the category of ‘How much do I want to save?’ make a list of all the things you want. All the things you really, really desire… make it as long and detailed as you can.

It can be simple – new underwear to replace the tatty old knickers you’ve had since forever, or a takeaway cup of coffee to drink while wandering along the river…

Or it can be big – a fancy sailboat to explore the world.

Anything and everything you can think of that can be exchanged for cash – imagine you have an endless stream of money flowing to you – what would you buy?

Wants vs Needs

This exercise serves 2 purposes:

It serves to show you the difference between what you want and what you need – chances are that most of the items on your list are passion items, things you desire and crave, but can live without. This helps you decide where you should be spending your money in the short term. (Hint: Replacing those knackered knickers is a perfectly acceptable expense, so go ahead and do so!)

Second, it serves as an incentive to get saving. See, those passion items are really not a bad thing and there is absolutely no reason why you shouldn’t have them – but all in good time. Having a list of things you want is an excellent way to curb spending, you are much less likely to waste money on frivolous items if there is something special in mind.

How much am I spending?

Log here daily. This cannot be stressed enough. Writing your expenses down is crucial if you want to get on top of your spending. The act of writing down all the money you spend both helps you see how much of the stuff you actually have (believe me, you are richer than you think…) and makes you think twice about spending in the first place, knowing you’ll have to write it down afterwards.

This is the section you will make notes on your emotional connections to purchases.

How will this make me feel?
Do I need it?
How did I feel buying this?
Was it worth it?

How can I improve?

Journal here at least monthly, but I found weekly was better for me – take stock of your expenses for the week, whether you spent more or less than you had hoped to, and how you can improve next week/month. Be honest with yourself about any money you feel in hindsight may have been wasted and take this into consideration when reviewing your budget at the start of next month.

(Pssst! I made a thing! I took everything I learned from applying kakeibo principles to my budget and created a digital Kakeibo for Mindful Money Management – everything you need to master your money! Find it in my shop!)

A New Light

Regularly logging your expenses, knowing exactly how much money you have coming in and from where combined with thoughtful reflection on your spending habits and emotional connection to cash will help you become a more confident master of your own money.

You may not be saving huge amounts, or anything at all to start with, but if nothing else, using a budgeting journal to get a handle on your finances makes you feel like a proper financial badass! #adulting

If you struggle with money, burying your head in the sand and handing over your credit card time and time again is not the answer and we all know this to be true. Be honest with yourself and start loving your money, so it can love you back! Budgeting this way doesn’t just show you how to build a good relationship with money, it shows you money in a completely new light, one which will illuminate, hopefully, more than just your bank balance.