Everybody spends money on food, and most of that money goes toward groceries. But, how much money should you be spending on groceries?
Some people ask this important question (especially those starting out), while some people never do. In this article, I’ll answer the big grocery budget questions, and give my own take on how much to budget.
Why Bother Worrying About the Cost of Groceries?
Food is critical for survival. Everybody needs it. And, what do humans do best when there’s a demand for something? They find a way to make money off it. Now, I’m not saying they are wrong to do that, especially when those services add value. But still, most food is not free, unless you’re the hunting or gathering type.
So, where do people go to exchange money for food? Quite a few places, actually! But, in general, most people will either dine out or go to the grocery store. Since you pay for more than just the food when you dine out, the grocery store is usually more cost-efficient.
But, even if it’s cheaper, the question still remains: how much should I be spending on groceries there?
What Do the Experts Say Groceries Should Cost?
Let me start by getting the expert opinions out-of-the-way. And by expert, I mean the United States Department of Agriculture (USDA). Every month, the USDA releases a Cost of Food Report. This report highlights how much families should spend based on average nutrition diets.
These diets fall into four plans:
So how do their recommendations work? They take their 4 plans and break them up into “age-gender” groups, as well as family size groups. Below, I’ve included a sample from September 2018, if you want to check out your own numbers.
Where do you fit into these plans? Personally, these reports don’t impress me.
A lot of people reading these reports want guidance for purchasing groceries, but instead, reading these feel like thesis research. There are a lot of numbers, with only a few explanations, and way too many footnotes. Nobody wants that. Plus, if you have a family of 3, or more than 4, you’re out of luck.
When I first found this resource, I was really excited! I thought it might help me reduce how much I spend on groceries. I was wrong. Turns out, my wife and I have lived below the “thrifty” plan for all 4+ years of our marriage. And you know what? We eat pretty healthy.
The USDA needs to put these reports in a format more people will find useful. If they want us to have this information, why make us work so hard for it? Would some pictures kill them? Maybe a fancy infographic? Anyway, even if they made it flashier, I still think their costs are a little high (at least where I shop – Meijer).
What Do I Say Groceries Should Costs?
So, what do I say groceries should cost? Well, that depends on your family size and dietary restrictions, and I don’t have all those answers. But, I can tell you what my wife and I spend and how we keep our costs low.
When we were first married and living together, we realized we didn’t know how much we should spend on groceries. And, like any good and clueless newlywed, I asked Google. I found one site recommending $70/week for a family of two, if you’re on a tight budget (and we were). To this day, I don’t remember where I found this number, but it has served us well (and challenged us).
Having a weekly budget was a little too much micro-management for me, so we eventually made it a $280/month budget ($70/week over 4 weeks). And, not only do we have enough for food each month, but we usually have extra for treats! Still, sticking to this budget requires some serious focus and a little planning ahead of time.
Since my wife cooks most of our meals (I bake our treats and do most of the dishes), she makes most of our grocery decisions. Because of this, I conducted a mini-interview with her yesterday to pass the time on our two-hour drive home. When it comes to shopping for groceries and sticking to our budget, her tips are below (paraphrased).
How to Save When Shopping for Groceries
First, meal planning for the upcoming week is really important. When you decide what you’re going to eat next week, you can make a list of everything you need. By making a list in advance, you don’t wind up buying a bunch of food you don’t really need. Pro Tip: Order your list in the order of your grocery store aisles. This will save time in the grocery store and avoid going back for stuff.
Also, coupons are critical to keeping your costs low, but only if they’re for things already on your shopping list. If you join store reward programs, they might even send you coupons based on what you regularly buy. Also, If you buy something on sale that you didn’t need, you didn’t save any money. You just spent more than you needed to. Don’t be a sucker.
Sometimes, you don’t even need to get a coupon to get a good deal. Most grocery stores have some pretty great sales if you’re there at the right time. That’s why she prefers to go grocery shopping once per week. If you go once per week, you see more of the sales. And, you don’t go back to buy one thing and wind up spending more than you intended.
And, this should go without saying, but you can always save by not buying things you don’t need. This includes, but is not limited to, soda, ice cream, and kale chips. This is difficult for me, because I love ice cream. Like, it’s a problem. Still, it’s an easy sacrifice during expensive months, like when you’re expecting a lot of guests for birthdays or holidays.
Meat can get pretty expensive, but you can save by buying family packs. Even if there’s just one or two of you, cook what you need, and freeze the rest. Also, try cooking with large pieces of meat and freeze the leftovers. She makes a terrific roast, and then turns the leftovers into sandwiches and noodle dishes.
Do you purchase soda or other bottles that have a recycle payback? Return your bottles! In Michigan, we get a generous 10 cents back for every can or bottle we return. And, since you pay these deposits when you buy the stuff, you’re throwing away money when you don’t return them. 5 or 10 cents per bottle might not sound like a lot, but that adds up!
If you have the time, you can also try making more things from scratch. Ounce for ounce, most things made from scratch are cheaper than the ready-to-go mixes. Plus, this way, you can make it exactly the way you like it!
How Much Should You Spend on Groceries?
How much you spend on groceries is entirely up to you. Like most of personal finance, shopping for groceries can be very personal. We all have our preferred tastes, brands, and stores, so we just need to make the decisions we think are best for us and our families.
Now that you know how much the USDA suggests and how much my wife and I spend, maybe you can make a better estimate on how much you should budget for groceries. At the end of the day, it’s about asking yourself what you really need and what you can really afford. There are so many ways to save money if you put in a little extra work.
If you want to spend $1,000/month on groceries, that’s totally fine. No judgment. Enjoy it! Just never tell yourself you have to, unless maybe you have a really, really large family to feed.
This is by no means the definitive guide on budgets for groceries. Still, I hope it gives a little more insight on how much you should and could be spending.
Source: Personal FI Guy