How much should I spend on groceries? - Family Budget Expert - Rob Bertman (2024)

Grocery shopping has become such a hot topic. Who knew something so routine would be such an exciting topic of conversation!

In December 2021, the cost of groceries had risen 6% vs the prior year according to the USDA and many economists think the same thing could happen in 2022.

This doesn’t seem to be just headline news, you are noticing it too.

A recent survey we did of our Family Budget Expert community / readers showed that 83% noticed an increase on either certain items or their overall grocery bill.

The average family size of those who noticed the whole bill going up was 4.1, while those who didn’t notice was 2.0 according to the survey.

You may have noticed this in a few ways:

• Your grocery bill has gone up.
• Certain things are noticeably pricier.
• The sneakiest one: Your item is the same price, but the box or bag is smaller.

How much you spend on groceries each month will depend on 5 main factors, and we’ll talk about them shortly.

I’ll also get you the answer to a very common question I get: “How can we spend less on groceries?”

5 Factors that Influence The Average Cost of Groceries Per Month

How much you spend on groceries each month will depend on 5 main factors whether you’re a thrifty grocery shopper or focus more on food not price.

Factor #1: Family Size

This one is fairly obvious, but one of the biggest determinants of how much you spend each month on groceries will be the number of people you’re shopping for.

A grocery budget for 2 will be much less than a grocery budget for 4.

Not only does family size multiply how much food per month you need to buy, but it also makes it more challenging to buy the right amount.

I know I can eat a 3 egg spinach omelet with a side of berries and apples, but what will my wife or kids want at that moment?

It’s not always as easy to buy the right amount of groceries when you’re factoring in another adult or even some kids who have finicky hunger.

This could be the biggest factor on how much you spend on groceries each month.

Factor #2: Age of kids

Next to family size is how old your kids are.

Whether you have young kids, older ones, or no kids at all, you probably remember how tough it was for your parents to keep everything stocked up because of your teenage appetite.

Honestly, I don’t know how my parents did it! I ate right through everything when I was in high school.

My 5 year old daughter is happy with a little bit of the main entree and a little of the sides and a small after-dinner treat. She’s like a ¼ portion of an adult.

With my 10 year old son, it depends on what’s on the menu.

But my 12 year old son can often eat more than me, a 6 ft guy.

Older kids = a higher grocery bill.

*By the way, taking them food shopping is a great way to teach your kids about money.

Factor #3: Dietary Restrictions

If you or anyone in your family has food allergies or dietary restrictions, it could make your food budget higher.

The good news is that these options are much more widely available than ever before (just like everything else), so it isn’t as big of a factor as it used to be.

You don’t need a Whole Foods or a specialty grocery store to get what you need anymore. Many local grocery stores have sections devoted to those with dietary restrictions.

Factor #4: Where you shop

Most grocery stores are just fine, but there are certain that are just absurdly pricier.

If you shop at Whole Foods vs Trader Joe’s, chances are you’ll have a higher grocery bill.

But we all have those local stores that just have a distorted pricing reality.

We have a local boutique chain here in St Louis that is close to my house. We needed a green apple for a recipe, so I thought, “I’ll just walk there real quick and pick one up.”

Well, one apple was…ready for this…$3! That’s like 4x a normal price. Everything in that store is like shopping at an airport, ridiculously expensive.

I’m not saying you shouldn’t support your local grocer, but be selective when shopping at the boutique ones.

Where you shop will impact your grocery bill.

Factor #5: How often you shop for groceries

This is one you probably didn’t think about.

I’ve seen this pattern over and over while working with clients.

Those who make 1-2 weekly trips to the grocery store spend a lot less than those who go 3+ times per week.

Why is that?

The more often we spend, the more likely we are to overspend.

Not only do we buy more every time we shop, but we don’t use up some of the groceries we have already bought which leads to more food waste (aka throwing money and resources in the trash.).

How much should you budget for groceries?

There are two ways to look at how much you should budget for groceries.

Along with the 5 factors:

• Family size
• Age of kids in the household
• Dietary restrictions
• Where you shop for groceries
• How often you go food shopping

We can look at what the average household is doing.

First let’s look at the percentage of income that people are spending on groceries.

This chart from the USDA shows the average monthly spending on food by income quintile as well as the share of discretionary income.

(Keep in mind that the “most recent” income is 2020 so the cost may have gone up by ~6%.)

The average percentage of income spent on food for those making the average or more has been around 10% historically or a little under that.

Groceries have historically been about 55-60% of household food expenditures. That puts the grocery budget at about 5-6% of income for most households.

Next, let’s look at what the data shows for the food at home expenditures by household broken down by 4 levels of spending (thrifty, low-cost, moderate-cost and liberal plans).

Let’s simplify the moderate cost data and call it $10 per day for anyone in the household 12 or older, and $6/day for kids 8 and younger. That’s about $300 per month for each adult and teenage kid and $180-$200 per month for each younger child.

The low-cost is about $8 per day for anyone in the household who is 12 or older and about $5 per day for kids 8 and younger. That’s about $250 per month for each adult and teenage kid and $150 per month for each younger child.

Here’s a sample of what it could look like for a family of 4 based on the averages:

The expensive category of monthly food costs is twice the household spending of the frugal one, so how much you should budget for groceries will also depend on how price sensitive you are when you go food shopping.

If you’re looking for a rule of thumb, I’d say if your grocery spending is under $1,000 per month for a family of 4 with older kids you’re doing ok.

Based upon the data, you could also say that food shouldn’t be more than 10% of your income unless you’re earning less than median household income.

To be clear, this is what everyone else is doing, and you can do better if you want to.

You can lower your monthly cost of groceries without having to disrupt your routine.

The extra money can go to building your savings, paying off debt or investing for the future.

How to save money on groceries – 7 tips without changing your routine

You can save money on groceries without clipping coupons and totally upending your grocery shopping routine.

You don’t have to look for money saving deals or get deep into grocery shopping on a budget

These tips will help you spend less than you otherwise have to and lower your grocery bill.

Buy Less – Avoid Food Waste

The average US household throws away more than 20% of the food they have at home by weight according to the US Department of Agriculture.

⅔ of that is food that goes bad, and that’s the expensive stuff.

Fruits and vegetables, meat, seafood, dairy are both the higher priced items and the once that people throw away most.

(Oreos and chips never seem to make it into our trash, but avocados do).

The other ⅓ comes from making too much food.

That means leftovers are not as big of a problem as food going bad that you never gets used.

Our family used to buy about 2 pounds of our entree protein but we’ve realized that we can get by with < 1 lb. That has dramatically reduced the cost of making dinner at home because it all gets eaten.

Start paying attention to the food that spoils and makes its way into the trash or compost in your house. Think about cutting back by 10-20% on those items.

It will be good for your wallet as well as the environment at large if that matters to you.

Keep a list…and stick to it.

I never used to keep a shopping list, and it not only cost me more time, but also more money.

For some reason, I always thought we needed mustard and it became a recurring joke for my wife Anna.

First of all, we don’t really use mustard. Second of all, why is that the one thing I thought we always needed 🙂

But when Anna and I got married, she introduced me to the grocery list and it was indeed groundbreaking.

When we run low on an item, we update the list on the fridge. The kids are even doing it now too, because they have learned that if it’s not on the list, we won’t get it.

Grocery shopping used to take me an hour or more, but now it takes me 20-30 minutes. I just grab the list and go. That’s a bunch of time saved and it also makes it easier to make a grocery run if we have a busy weekend.

Another thing Anna does is keep a list of potential entrees we can make and the sides we have available. That way, we don’t forget what we have and it doesn’t go bad. The frozen stuff can wait so that the fresh fish gets used.

Not only does it make sure we go through our food, it also saves us from the, “I don’t know what to make, so let’s just go out for dinner,” decision which can be costly over time too.

We mainly do this for dinner, but it will work for breakfast / lunch also.

Opt for the less expensive choice

This is another great way to save money and helps you become more conscious of how much you’re spending.

One example is if you see two perfectly good pieces of protein at the supermarket and you’d be happy to take home either one, just choose the less expensive option as long as it fits.

Same thing with fruits and veggies. Yes, honeycrisp apples are delicious, but they can also be $4 per pound. If you like another kind that is $2 per pound, think about switching it up.

Buy the actual produce instead of prepared foods. Why spend a premium for a pre-cut berry mixture vs just buying them and combining them after the fact?

Again, the end goal is to end up with the food you want but just choose the less expensive option.

Go to the grocery store less often

This goes back to one of the factors that influences how much you spend on groceries.

Each time we go to any store, we’re more likely to buy more than we intended.

My clients who can spend less often, often spend less money. It’s one of the ways you can stop spending money without a strict budget.

It’s not like we go out looking to spend more, but there are more things in front of us to buy. We run to the store for more milk then see other things we think we might want, so we get them even though we wouldn’t have bought them in the first place.

The more often you shop for groceries, the more important it is to keep a grocery list.

If you shop often, don’t try to drastically change it. Just see if you can reduce the number of grocery runs by 1 per week.

Cut back on shopping at the pricier chains

Notice I didn’t say that you shouldn’t shop there at all, just cut back.

There are just certain foods my family is going to get from a more premier grocery chain because it’s worth the extra price. But we have also learned that some items at that store are just so far out of whack that we get those items elsewhere.

Figure out the items you really love to get at the more expensive stores and continue to get them.

But also see if you can figure out how to buy certain items at other grocery stores that will cost less but still get you the similar quality you’re looking for.

Cook through your fridge, freezer, and pantry

This is the brilliance of Anna’s entree and side list that she keeps on the fridge.

We don’t forget about the food we have handy to make.

Even if it’s hidden in the depths of the freezer or in the back of the pantry, we know it’s there because the list is visible on our fridge.

Successful companies manage their inventory well because anything that doesn’t get used or sold is wasted money. The same thing applies to the food in your house.

Grab a piece of paper or your phone and dig around in your freezer, pantry and refrigerator. Make a list of the things you could make for meals both the entrees and the sides.

If the average meal made at home is $7-$10 per person, using what you already have can save you that amount per person in your household.

Cut back on grocery delivery

Don’t worry, I’m not saying you have to stop it all together.

Those delivery fees and tips one-time don’t seem like much, but it adds up to thousands over the course of a year.

The sneaky part is the minimum that you have to spend.

Not only are the explicit fees costly, but if you buy things you don’t need to meet the minimum delivery, that is also wasted money.

If you’ve gotten used to things like Instacart, try to lower it by one time per week.

How much should you spend on groceries?

This will depend on the factors above, but the first step is always tracking your spending to see how much you’re spending currently.

Spending $800 per month on groceries could be attainable if you’re currently spending $1,000 per month, but not if you’re spending $1,500.

Start with knowing your number, then use the tips above to find ways to gradually lower your grocery spending over time.

Think of it as an experiment and do just one of these at a time. The most important thing is that you make progress rather than trying to have the perfect plan that is tough to execute and won’t stick.

If you’re looking for more specific help with your situation, I’m always available for a complimentary 30 minute consult.

Check my calendar to find a convenient time.

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