How Much To Budget For Food

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This post will walk you through how to make a grocery budget you can stick with, as well as a food budget calculator to give you a ballpark of where to set your food budget. Also, learn helpful tips to reduce your food budget so you can save more (and go on that family vacation you’ve been talking about).

If you’re like most people, you probably don’t realize how much money you’re spending each month on food.

Maybe you have no idea how much you spend each month on food. You go to the grocery store, pick out your groceries for the week, drop your Visa and call it a day. But now you wish you had a better handle on how much money you’re dishing out each month.

Or maybe you’re painfully aware of the cost of food. You search for the cheapest prices, desperately wondering how you’re going to pay for it all.

Then when you reach the checkout counter, you’ve got a pit in your stomach because with each item that gets rung up, the total inches closer and closer to that “maximum” number you have in the back of your head.

No matter which boat you’re in, I’m here to help you set a food budget you can realistically stick to (with tips for how to get it as low as possible).

Why set a food budget?

Why set a food budget? Well there are a few reasons you might want to.

1. Awareness – Maybe you’re trying to become more aware of where your money goes each month.
2. You want to save for something else – You can’t lower your budget until you know where you’re at.
3. Changing diet – Have you decided to try a new diet (maybe Paleo or Keto) but you’re not sure how it’s going to affect your spending?

Before I started keeping a monthly budget, I was completely unaware of how much we were spending on food. I had a vague idea in the back of my head, but never took the time to check it.

And when I did…I was shocked to see how high that number was.

When you start tracking your grocery spending and make a budget, you take control of your spending. Does the number feel too high? Then take steps to reduce it.

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You might want to set a food budget because you’re trying to save for something big (like a vacation), or because you’re trying out a new diet and you want to make sure the cost of different food isn’t breaking the bank.

In this post we’ll talk about these steps you need to take to make a food budget.

1. Commit to taking action
2. Track your spending
3. Set a realistic budget for your family size and situation
4. Reduce your spending (optional, but…why not?)

Commit to taking action

Before you set out to make a food budget, you’ve got to be ready and willing to put in the effort. Because that’s really the only way you’ll make any change. By putting in the work.

Sit down with your spouse and kids (if they’re part of the grocery buying team) and talk about your goals.

Write down your priorities when it comes to food.

• Is organic produce important to you?
• Do you want your meat to be grass fed/pastured?
• Or maybe following a specific diet is a priority? Paleo? Keto?
• Are whole foods (with the simplest ingredients) a priority?

Spend some time talking about your hopes and dreams for the money you’ll be saving.

Maybe you plan to spend your grocery savings on a big family vacation? Or you use the money you’re saving to take the whole family out to eat. Before you can start grocery budgeting, you’ve got to come together as a family and decide on priorities.

track your spending & do a Grocery Audit

Before you can set a grocery budget, it’s a good idea to figure out how much you’re currently spending. Depending on how detailed you want to be, you can do this in two ways. I recommend separating out grocery spending and restaurant spending into two different categories.

1. Just track the total you’re spending on groceries.
2. Track your grocery spending based on category (meat, produce, dairy, etc.).

It’s your choice how granular you want to make your tracking. You can either track your spending each day or keep your receipts in a “food spending” folder on your desk and go through them all at once (I prefer this way).

You can make a spreadsheet of your own to keep track of your findings, or use a grocery budgeting app. I’ve used Mint in the past and it worked pretty well. It’s a great FREE budgeting option if you’re just getting started.

After you’ve got your month of grocery & food expenses tracked, you can start doing your analysis.

Are you happy with what you’ve been spending? Are you surprised by any of the categories? Is your spending in line with your family’s goals? This is the time to make note of things you want to change, and to start thinking about how much is a realistic budget for your family’s grocery spending.

Set a realistic budget for how much you plan to spend on food

So how do you find that number that makes sense for you? Not too high so you’re wasting money. And not too low that it’s unrealistic and impossible to stick with?

First, I want to mention that it’s REALLY hard to compare your budget to someone else’s. That’s because everyone has different priorities. The family with an unmovable “Organic and grass fed” priority will have a different budget than the family with the priority to spend as little as possible on food, even if it means eating conventional meats.

Other considerations that will affect your budget:

• Does your family have any dietary restricitons or food allergies? This will often (but not always) increase the amount you spend on groceries.
• What’s your family size? A bigger family will typically pay more for groceries (more mouths to feed, ya know?).
• How often do you eat out? Eating out is more expensive than making meals at home.

If you want a ballpark number to compare (because let’s be honest…it’s nice to have a frame of reference), here are two options.

1. Use the USDA national average of food prices (see the table below) and compare that with what you found from your family’s spending.
2. Use a fixed percentage of your income, like Dave Ramsey suggests. He recommends allocating between 10-15% of your budget on food (that’s the total for groceries AND eating out). Use the calculator below to do this math for you.

USDA Grocery Budget – National Average of Food Prices

The USDA puts out a table of average food costs every month. Here’s a summary of the full report for the month of December 2019 (adjusted for inflation up to 2022).

Age-gender groups*	Thrifty	Low-cost	Moderate-cost	Liberal
Female individual	$203.07	$256.82	$315.00	$403.44
Male individual	$228.66	$295.94	$370.85	$453.99
Family of 2	$474.90	$608.11	$754.36	$943.16
Family of 4 (kids 2-5 years old)	$693.60	$886.09	$1093.96	$1352.51
Family of 4 (kids 6-11 years old)	$795.56	$1045.25	$1306.38	$1583.63

*The adult age category of 19-50 is used for all values in the table. For other age groups, see the full USDA report.

You can use this table as a loose guide when setting your grocery budget, if you use it at all.

It divides food spending into four different categories, based on how “thrifty” you are. By giving four different budget categories (thrifty, low-cost, moderate-cost, and liberal), you should be able to get a good starting point for your food budget.

Related: How To Save Hundreds On Food By Simply Making A Meal Plan

Another thing to note is that this data assumes you cook all your meals at home. If you eat out, your food costs will be higher.

Dave Ramsey Grocery Budget

Dave Ramsey, the budgeting & get-out-of-debt guru recommends spending between 10% and 15% on food costs.

So, when you’re setting your budget, start with 10% of your take-home pay.

Reduce your Grocery spending

Once you have your grocery budget set, it’s time to think about how to reduce your grocery spending.

This step is optional, of course. But in my opinion, totally worth it. Because, I mean…who wants to spend more than they need to on groceries?

Related: How to Shop for Groceries on a Budget (and Stick to Your Budget)

Here are my top tips to lower your grocery bill.

1. Budget with priorities in mind. Your grocery budget will be different than your neighbors, because you both have different priorities. To learn more about building a priorities based budget, watch this free training.
2. Make a meal plan. It’s true that making (and following) a meal plan can actually save you money. Sign up for a FREE guide on how to get started meal planning here.
3. Buy in bulk. Sometimes this means getting large amounts of food to get the unit price lower (i.e. shopping at Costco), but it also means using the bulk bins in your local grocery store. I HIGHLY recommend this for spices. You can save a lot of money by buying your spices in bulk and just re-using the containers. I’m talking about a price of about $0.23 for a full container’s worth of garlic powder vs $4 for a new container. HUGE saving potential.
4. Make a grocery list before you go to the store. Use the back of an envelope, a piece of scratch paper, a meal planning app on your phone, or grab one of these meal planning printable templates (FREE) with a section for your grocery list. Make a list before you go, and don’t shop hungry.
5. Shop around for the best price. I learned how to get the best deal on groceries from this grocery budgeting course. Erin (the creator) provides tons of actionable tips and tricks to set your grocery budget and spend as little on groceries as possible (without sacrificing the quality of food).
6. Consider shopping online for your groceries (or at least ordering online and picking up at the store). When I buy groceries online I’m much less likely to make impulse purchases and stick to my list. Try these three online grocery options.

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