Savings target · GBP
Save £7,500 in 3 months
£2,500 a month, £1,154 a fortnight, £82.14 a day. Then the kakeibo part, which is deciding which of the four categories gives it up.
- Every fortnight£1,154
- Every week£577
- Every day£82.14
- Entries to make91 days
Money stops coming out of discretionary spending alone at £50 a day, where the rule is drawn. This target sits above it.
At this level the arithmetic is asking a structural question. Housing, transport and insurance are where an amount like this actually lives, and pretending otherwise wastes a month.
On a three month run there is no room for a bad month to be absorbed. Build the first month at the full rate rather than easing in.
What this asks of your income
Read it as a sanity check rather than a rule. If your take home salary is around £12,500 a month, this target is a twenty percent savings rate, which is demanding but ordinary. Well below that and the horizon is doing the wrong job.
- 10%£25,000 a month take home£22,500 left to live on
- 15%£16,667 a month take home£14,167 left to live on
- 20%£12,500 a month take home£10,000 left to live on
- 25%£10,000 a month take home£7,500 left to live on
- 30%£8,333 a month take home£5,833 left to live on
The dark slice is £2,500, the same money on every rung. What changes behind it is the pay packet it has to come out of, which is the whole reason a savings rate is a better question than a savings amount. The marked rung is twenty percent.
Which envelope pays for it
Kakeibo sorts spending into four envelopes rather than dozens of line items, and that is what makes a question like this answerable.
- Survivalwhat keeps the lights on: rent or mortgage, the weekly shop, energy, council tax, travel
- Optionaltakeaways, subscriptions and the shopping you would not miss
- Culturea course, a museum membership, books
- Extrathe irregular hit: car repairs, a wedding gift, the vet
£2,500 a month, carved
- Optional45%£1,125
- Culture15%£375
- Extra15%£375
- Survival25%£625
Total moved to savings£2,500 a month
Splitting it across Optional, Culture, Extra and Survival is one way to arrange it, and the Survival line is the honest part: at £2,500 a month, no rearrangement of takeaways, subscriptions and the shopping you would not miss covers the whole figure. Survival means fixed costs, so that share is a housing, transport or insurance decision rather than a willpower one.
At this size the target is usually a plan rather than a purchase: a trip, a deposit on something, several months of breathing room.
The four questions, against this target
The method is four questions asked once a month, in that order. Here they are with this page's numbers in them. The long version of each, with the reflection prompts, is in the four questions guide.
- 01How much money do you have?Everything that lands in the month, before anything is committed. The plan below only works from a real figure rather than a remembered one.
- 02How much would you like to save?£2,500 a month, or £2,500 if you would rather set a round standing transfer and finish early.
- 03How much are you spending?Recorded by hand, in four envelopes, as it happens. This is the part that makes the £7,500 possible, and the part every method skips at its peril.
- 04How can you improve?Answered once a month for 3 months, in writing, against the running total rather than against a feeling.
- 3 months£2,500£82.14This page
- 6 months£1,250£41.07
- 9 months£833£27.38
- 12 months£625£20.53
- 18 months£417£13.69
- 24 months£313£10.27
- 36 months£208£6.84
£82.14 a day is above the £50 a day line, so part of the money has to come out of fixed costs rather than out of Optional. Run the same £7,500 over six months instead and it drops back under.
The same target in another currency
Or work from your own figures in the save an amount by a date calculator, and start from the method itself in what is kakeibo.
Common questions
- How much do I need to save each month to reach £7,500 in 3 months?
- £2,500 a month. Set it to £2,500 and you arrive early with a small cushion, which is usually worth more than the exact figure.
- What is that per week and per day?
- £577 a week, £1,154 a fortnight, and £82.14 a day across roughly 91 days.
- Which kakeibo category should the money come from?
- Start with Optional. On this target it carries about 45 percent of the monthly figure, which is £1,125. The ledger tells you the specific lines within a fortnight.
- What happens if I miss a month?
- The shortfall spreads across what is left. Missing one month here adds about £1,250 to each remaining month, so it is recoverable, and the monthly reflection is where you decide whether to absorb it or move the date.
£2,500 a month is arithmetic. Holding it is the ledger.
Kakeibo works because you write the spending down as it happens and read it back once a month. The app does the totals so the writing down is the only work left.
