Immediately set aside savings *before* budgeting for expenses. The remaining funds are divided into four categories:
- Survival (essentials like food, bills),
- Optional (dining out, entertainment),
- Culture (books, education), and
- Extra (unexpected costs like gifts).
This prioritizes savings over discretionary spending .
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The Japanese lifestyle has inspired many people around the world. One of them is the way they manage their finances.
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- 30%: Discretionary Expenses (Non-essential) like Dining out, entertainment, drinks, etc.
Categorizing Your Current Spending
It's important to have an overview of your money and where it's being spent. It's possible to fit your expenses into these four categories:
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