I am all for helping people get control of their spending and if Kakeibo is what it takes for some: wonderful! Use it!

Just know: the envelope method has existed for years. My wife and I have used it for 39+ years — and it has been promoted generations before.

While I don’t have it at my fingertips, there are some studies that show use of credit cards (as opposed to cash) increase spending by something like 20%-30% — if I remember correctly.

In the West, folks like Dave Ramsey (not everyone likes his brash style) and Larry Burkett, have refined the art. Ramsey says “do plastic surgery” (i.e., cut up your credit cards) and Burkett says, “Pay them off every month and the month you can’t pay then off — cut ’em up!”

Here’s my suggestions:

1. If you have a partner, decide which one has the most discipline in finance and bookkeeping skills. He or she is the “comptroller general” of the family! In our marriage: my wife — hands down. I’m a slob and not good with figures. She can balance a check book (yes, we still use check books) by hand to the penny.
2. If you use a debit card — keep a check book register! That helps you track expenses and avoid over drawing!
3. Give each of you “allowances” so you don’t feel as if you have to beg the other for extra funds to buy that occasional cup of coffee or book. (Note: a round of golf is not a “necessary” expense or an “emergency” — that’s entertainment — put it in your spending plan, but you might have to limit how often you play!). Make-up and grooming are fairly essential in most societies. Those items fall under “miscellaneous” in our spending plan — and it is a monthly item that does not vary.
4. Plan on monthly entertainment in your envelopes. When you run out — you stay at home! The same with groceries — and use cash! Weekly envelopes for groceries. If you run out of funds that week for groceries, dig around in the pantry and eat what you have! You’ll be amazed at how this will force you to shop wisely!
5. Change your terminology. This isn’t a “budget”. It is a “spending plan”. Your “savings” is actually money “spent” on you.
6. Every dollar is to be “spent” at the beginning of the month on paper. That means after you have accounted for actual expenses and put aside money for annual or bi-annual expenses (like insurance payments and Christmas) take what’s left over and put it in an “emergency fund” (or a “take this job and shove it” fund). Your emergency fund should eventually cover three to six months of living expenses (not wants) — just in case you lose your job.
7. You have bi-annual and annual expenses. You have housing repair, health care deductibles, etc. Plan those monthly. We have a separate “budget bank account” and we keep a divided ledger for that. If I have to replace my tires, I don’t go to my emergency fund — I go to my car maintence fund. And Christmas (or whatever gift-giving holiday you observe) — isn’t it funny how that rolls around once a year? How much do you want to spend? Divide it by 12 and put it in your budget account! This way you are not scrambling when it comes around!
8. Avoid buying depreciating items on credit (like cars). This is hard. But you know something? You can buy a clunker and drive it while you’re saving for an upgrade. If you can make a monthly car payment, why can’t you make the payment to yourself and buy a car cash (and don’t even get me started on leases — “Ah! But I don’t pay for the depreciation!” Au contraire! That is all you are paying for!)
9. Someone once suggested: 10% give away, 10% for you, 10% for savings and the rest for living. Give money to worthy causes, to the homeless, to your favorite non-profit, church, mosque, temple, or synagogue: be generous and kind with your funds.
10. Oh, and remember: you don’t have to go to Disney World or Europe every year for vacation! There are plenty of wonderful vacation opportunities that cost very little. It isn’t the amazing and exciting stuff that your kids will remember (if you have kids) — it’s the relationships and the time spent together.

Oh, and I didn’t ever have a job (before 2009) that paid benefits. No health insurance or retirement. I paid it all from my salary (the bill was over $12,000 per year). So my lower-middle class salary was lower than most people realized.

In 2008 I lost my job and was without one for a year. Guess what? I only owed for my house. We were a single income family — and my salary was not median for the US. We both got part time jobs — combined we made around $40-$50K. We even mowed yards. We paid only expenses — what was actually necessary. And we socked away $10,000 in savings that year (which completely surprised us!). Which means we pared down living style to about $30,000 that year. And we survived. If we hadn’t been living like this all of our married lives, we would have gone bankrupt.

I say this to point out: this is doable! But you have to truly decide what is best in the long-run. This isn’t about logic — it’s about emotion. Get angry that you’re in debt. Get angry that you live from paycheck to paycheck. Then put that energy into solving the problem by becoming disciplined.