Q: I make a decent salary and should be able to save some money. But more and more often I find myself without anything to put away for saving at the end of the month. I know saving for the future is important, but I keep buying stuff I don’t really need. Any suggestions?

A: Sticking to a budget is one of the hardest things to do. Many of us aren’t naturally inclined to save, and some people even exceed their financial limits by using credit cards or pay-by-installment plans.

Fortunately sticking to a proper budget is easy if you follow a few simple steps.

Many of us are wired to spend what we have. The more we have, the more we spend. The easiest way to prevent over-spending is to “pay ourselves first”. That is, put some money out of reach before you have a chance to spend it.

First, plan a budget that covers all of the things you will need or want over the course of a month. Don’t go wild, but don’t be too conservative, either. Don’t forget to include things like clothing, entertainment, health, and vacations.

Now subtract your total monthly expenses from your monthly salary. Depending on your living expenses and income you will likely find that the amount left over represents about 10 % to 40% of your monthly salary.

Every payday immediately split your salary into two or more bank accounts. The largest portion will be the amount you need to live on over the course of the coming month. Spend these funds how ever you want! You shouldn’t need to track your spending in detail because your account balance will naturally conform to the number of days left until pay day. In other words, you can only spend what you have in your account!

From the smaller portion of salary start building an emergency fund. This may take a few months, but it is important to have at least 300,000yen (or more) available in case something unexpected arises.

After your emergency fund is built, at least 10% of your monthly income should be sent to a regular (tax advantaged) investment plan. The more you invest now, the more you will have when it is time to retire! If you aren’t part of at least one national or corporate pension program then you should put away at least 15% of your income every month. Of course, many people invest much more than 15% each month. Find the amount that fits best with your personal circumstances, outlook, and objectives.

Adhering to a reasonable budget ensures that you will have the resources you deserve when it is time to stop working. Your future self will thank you for taking action now, and for “paying yourself first.”

Money Matter Q&A