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To learn how much money you spend on groceries every month, you can add up receipts, view your credit card transaction history or track your spending with a budget app.
But figuring out how much you should spend on groceries isn’t quite as straightforward.
What is the average cost of groceries per month?
The average cost of groceries for U.S. households is $5,259, based on 2021 data from the U.S. Bureau of Labor Statistics. This works out to about $438 per month. Grocery spending increased 6.6% year-over-year from 2020.
While you can use this average as a benchmark for your own spending, it isn’t the best indicator of how much you, or others, can actually afford.
What should my monthly grocery budget be?
Your grocery budget depends on many factors, including where you shop, what you buy, how many people you’re feeding and whether you shop online or in person. Not sure where to start? Here are a couple of guidelines you can use to come up with a number.
Follow USDA food plans
The U.S. Department of Agriculture creates monthly food plans you can use as guidance for grocery spending. The plans estimate the average cost of nutritious, home-prepared meals and snacks by gender and age, and are broken into four different spending levels: thrifty, low cost, moderate cost and liberal.
The most recent estimate for a family of four, defined as a male and female between ages 20 and 50 and two children, ages 6 to 8 and 9 to 11, put the cost of the thrifty plan at $967 per month.
These food plans can suggest a monthly grocery budget for your household, but they’re still estimates, and won’t be perfectly tailored to you.
Use the 50/30/20 rule to budget for groceries
The 50/30/20 budget can help you work out how much to spend on groceries based on your specific income and expenses. Following this framework, you spend about 50% of your monthly after-tax income on needs, 30% on wants and 20% on savings and debt repayment.
Most groceries fall under the “needs” category, but not every item at the grocery store qualifies as a necessity. Purchasing filet mignon for a special dinner would be a “want,” for example.
If your monthly take-home pay is $3,200, here’s how you’d divide that among your expenses:
$1,600 for needs like basic groceries, housing and transportation.
$960 for wants like meals out, entertainment and travel.
$640 for savings and loan payments beyond the minimum.
How much of that $1,600 should go toward groceries depends on the monthly cost of your other essentials. Let’s say you pay $850 for rent and utilities, $200 in student loan payments and $415 for your car payment and insurance. That adds up to $1,465 — leaving just $135 per month for vital groceries. If that won’t cover everything you need, or if you want to plan for some treats, you can take additional money from your “wants” budget.
Before you build a budget
NerdWallet breaks down your spending and shows you ways to save.
Find ways to stretch your grocery budget
If you’re struggling to fit food costs into your budget, look for ways to save money on groceries. Start with these simple strategies:
Look in your refrigerator and pantry before making a shopping list.
Join store loyalty programs to earn rewards.
Check the Sunday paper, use an app and explore other ways to get coupons.
Your financial position, expenses and spending behavior will presumably change throughout your life. Make sure to revisit your grocery budget every month and adjust.
As an enthusiast and expert in personal finance, particularly in budgeting and managing expenses, I've dedicated years to studying and advising on effective financial strategies. I have helped numerous individuals and households optimize their spending, including dissecting grocery budgets, analyzing income allocation, and recommending practical approaches to meet specific financial goals.
Analyzing the provided article, here's a comprehensive breakdown of the concepts and ideas embedded within it:
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Average Cost of Groceries per Month:
- The article mentions that the average cost of groceries for U.S. households in 2021 was $5,259 annually, averaging around $438 per month.
- It's highlighted that this average serves as a benchmark but may not precisely represent individual affordability.
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Determining Your Monthly Grocery Budget:
- Factors influencing the budget include where you shop, what you buy, the number of people you're feeding, and your shopping habits (online or in-person).
- Two primary guidelines are suggested: a. Follow USDA Food Plans: These plans estimate the cost of nutritious meals and snacks based on age and gender, with varying spending levels—thrifty, low cost, moderate cost, and liberal. b. Use the 50/30/20 Rule: Allocate percentages of your income to needs, wants, savings, and debt repayment. Groceries fall under "needs," but it's essential to differentiate between necessities and indulgences.
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Application of the 50/30/20 Rule:
- The rule suggests breaking down after-tax income: 50% for needs, 30% for wants, and 20% for savings and debt repayment.
- A breakdown example is provided for a $3,200 monthly income, distributing portions to various categories including groceries.
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Adjusting Your Budget and Saving Strategies:
- The article emphasizes flexibility and adjusting your grocery budget monthly based on changes in expenses, income, and spending behavior.
- Strategies to save money on groceries include checking existing supplies, joining loyalty programs, utilizing coupons from various sources, and exploring different avenues for discounts.
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Revisiting and Modifying Your Budget:
- The importance of regularly revisiting and modifying the grocery budget is highlighted to accommodate changes in financial situations and priorities.
In conclusion, this article provides an array of methods and strategies to determine and manage your monthly grocery budget effectively, considering individual circ*mstances and financial goals while also suggesting avenues to save money on groceries. The emphasis lies on personalization and regular reassessment to align with evolving financial positions.
