After the “Lost Decades”, the Japanese populace often conjures impressions of parsimony. Septuagenarian money-saving savants preach televised tutorials on subsisting on merely 1,000 yen daily for four decades. Thirty-year-old matriarchs meticulously prepare protein powders to provide quotidian breakfasts for families of five. Parentally bereft children ingeniously devised thrift to rear younger siblings.
In June this year, another Japanese netizen exhibited a repast of just rice, pickled umeboshi plums and tamagoyaki omelette, professing impending accession to billionaire status through accrued savings. The Japanese propensity for pecuniary temperance has long vexed government and academia. Scholars even contrived the term “low-desire society” to depict this distinctive Japanese phenomenon.
These Japanese people are not necessarily economizing out of authentic penury. The enduringly indelible “Lost Decades” imprinted lingering gloom. Structural encumbrances like aging populations and declining birth rates also seeded pessimistic visions of the future. Although inflation has persisted since last year, deflationary mindsets may not swiftly dissipate.
At June’s end, a netizen named “A Person Who Will Absolutely Resign” flaunted a Spartan dinner on social media. Just white rice, one umeboshi and a tamagoyaki graced the table. Such privation would worry any observer. Yet this netizen claimed that 20 years of such stringent savings had amassed 93 million yen in deposits.
This austerity has long characterized “People Who Will Absolutely Resign.” Meat and fish were delicacies, enjoyed only a few times monthly. Often acquired with coupons, meats and fish were rare indulgences. Mainstay proteins included expiring tofu, natto and milk.
When July’s heat scorched Japan, this netizen even tested cooking potatoes and sweet potatoes on his windshield. Although this failed, halving, foil-wrapping and extending exposure from 3 to 5 hours proved successful.
“People Who Will Absolutely Resign” survives thus to achieve “FIRE” – Financial Independence, Retire Early. After 2020, this concept gained popularity among youth – saving and investing to enable early retirement. For the investment-averse, frugality is the most feasible FIRE pathway.
Admitting no investing aptitude and negligible stock profits, our netizen can only save by minimizing living costs. This year he expects to attain his 100 million yen savings goal, enabling retirement 5 years ahead of schedule at 50.
Such austerity may seem to require extraordinary discipline. But escaping exploitative employers provides greater motivation than asceticism. Working under oppressive conditions inflicted far worse psychological and physical tolls than meager rations. Saving to escape this workplace purgatory as swiftly as possible was his driving force.
To chart his trajectory, “People Who Will Absolutely Resign” scripted a nine-episode “Life Story.” The saga’s conclusion was a bright FIRE future. But early chapters were stygian, originating with “I Joined an Exploitative Company.”
Freshly graduated amid an “employment ice age,” he was grateful to be hired by a major corporation. But endless indignities awaited in this sweatshop. Arriving at 6 AM meant cleaning tables, taking out trash and brewing tea for over 30 “seniors.” Despite 5 PM end times, compulsory overtime kept him working until 1-2 AM.
His most frequent social media posts were cartoons of ragged, indentured slaves grinding mills. He likened his working life to ancient torture, even titling the fourth episode “Harbor Thoughts of Hanging Yourself.” Now nearing 100 million yen, he sees himself on the “Path to Riches” and nearing a “Slave’s Revolt.”
In truth, 20 years of austerity enabled his impending FIRE success. Marriage and children were impossible without sacrificing savings. Once committed to FIRE, he opened a dedicated account, capping annual expenses at 3.6 million yen.
As he neared billionaire status, his story went viral. Twitter, Yahoo! and more streamed him into trending topics, and he made TV appearances. Such cases often grace Japanese media.
In 2021, a 57-year old uncle reached FIRE with 100 million yen savings. Kazuma Sakaguchi resigned six years prior, having accrued sufficient savings. Unlike “People Who Will Absolutely Resign” who rents, Sakaguchi owns a Kanagawa home free of any mortgage.
Sakaguchi’s 4.5 million yen annual salary slightly exceeded the 4.36 million yen average. His savings tactics included wearing the same t-shirt for over 20 years and keeping his 2007 Nokia phone. Empty fridges meant buying only immediately consumable groceries. By limiting monthly costs below 100,000 yen, he saved 2.2 million yen annually, reaching 100 million yen after over 30 years.
With minimal material aspirations, Sakaguchi relished the process of achieving financial freedom. Volunteering and occasional travel now occupy his time. His favorite seven-wheeled charcoal grill gets taken to parks for leisurely cooking.
The Japanese obsession with thrift frustrates the government. Economist Kenichi Ohmae described the societal disinclination to spend as a “low-desire society.”
This “low desire” phenomenon is especially prominent among those born in the 80s and 90s.
In his 2015 work “Low Desire Society,” Ohmae painted a bleak portrait of Japan: declining populations, extreme aging and ambitionless youth. Citizens held abundant financial assets and companies maintained massive capital reserves, yet neither could be effectively utilized. Neither loose monetary policies nor public investment managed to resuscitate consumer confidence or galvanize the economy. Ohmae stated “The Japanese have grown accustomed to low-growth” and Abe’s “Abenomics” could not resolve the “low-desire society.”
The post-bubble collapse birth cohort grew up experiencing the “Lost Decade,” “Lost 20 Years” and an “employment ice age.” Entering stagnant economies with uncertain futures, it is understandable they feel aimless.
Implemented since 2012, “Abenomics” focused on increasing corporate profits to invigorate Japanese capital. But this worsened prospects for young workers. From 2013-2018, corporate profits doubled, yet real incomes declined annually. Today’s workers must expend 11% more hours to earn equivalent real wages to 20 years ago.
Statistics show 4.5 million full-time Japanese workers take second jobs, laboring 6-14 extra hours, sometimes even 30-40. Under these circumstances, work is no longer a path to self-actualization, but a hellish ordeal to escape as swiftly as possible.
Deflation since the 1990s hamstrung consumption and investment, prompting policies to restore inflation, like quantitative easing. But such efforts seldom resonated with youth or restored confidence.
An inflationary reprieve may be forthcoming. Core CPI soared to a 42-year high of 4.1% in April 2022. May saw 3.2% growth. However, June statistics revealed with ongoing inflation, real wages dropped 3.0% annually, marking 13 consecutive months of decreases.
Some fear household purchasing power will be suppressed, slowing consumption and recovery. Considering structural drags like aging populations, altering youthful “deflation mindsets” may remain challenging. Japan has flashed signs of recovery during the Lost Decades, but these proved short-lived. The FIRE-chasing, frugal netizen is likely here to stay. After all, Japan has teased at a deflation escape many times in the past three decades, but each has been evanescent.