Managing your finances is something that you’re constantly learning, but that doesn’t mean that one size fits all. While you likely have similar goals to others, there are many ways to approach the process. Cultures worldwide have different ways of dealing with money, and getting a different perspective on financial matters can help you understand yours better.
The Japanese use the Kakeibo method, and that helps them stick to financial goals and spend well to get there. The Japanese have been using this method for more than a century, and one reason it works is its simplicity. At the beginning of every month, they decide on their savings goals and determine the necessary steps to get there. To do so, they use pen and paper to organize their finances into four main categories. These include:
- Needs: Housing, food, and transportation
- Optional: Going out to eat and fun shopping trips
- Extras: Gifts or unexpected expenses
- Cultural experiences: Movies, books, or music
You can do something similar by creating a budget to track your money. Some apps help you figure out how much you are spending each month. They give you a way of seeing how much you are spending each month. If you want to save on your monthly expenses, try cutting down on specific areas. For example, if you have debt from school, consider refinancing that loan into a new one with the help of a private lender. A student loan refinance might save money since you can often get lower interest rates than when you initially got the loan.
Many people in this country don’t have bank accounts, making it harder to invest their funds. However, the economy is not as formal as other places because many Mexicans use cash for everything. They often don’t trust the banks and governmental assistance available to them. Many Mexicans use Tandas, which is a savings group. Each person contributes toward a pool of savings, and that gets rotated among members. That way, if a big purchase is necessary, the individual can do so without relying on formal financial institutions. Think of it as a type of short-term loan. One of the benefits of this system is that it reduces impulse buying and splurging. Instead, it encourages better savings habits.
Many Chinese people follow Taoism and Confucianism, and each of them encourages a culture of frugality. Because of that, people in this country often save more than people in other countries. They often partake in bargaining to get a better price on different products. Many vendors in the country are ready to negotiate with the costs of goods, so everyone feels reasonable. The tradition of saving money is passed down through the generations. Many Chinese people have grown up in families that set aside a large portion of their income into savings. Even people who have more disposable income still try to live relatively simply to ensure financial security. Many of the people who have a significant amount of money are also those who spend the least.
Stay updated with all the insights.
Navigate news, 1 email day.
Subscribe to Qrius