Life without food wouldn’t just be literally impossible – it would be really boring. Three good meals a day aren’t just vital to your health, but a good meal can also be a highlight of your day. Not everyone, though, can easily afford the groceries involved in making an extravagant dish – or buying one from a nearby delivery or takeout spot – for every meal. That’s why it’s so important to plan a food budget: You can’t forgo food, so you need to know your limits for preparing it or ordering it. Here’s how to plan a food budget and stick to it.
Set an income-based limit
Experts recommend capping your food budget at about 10 percent of your disposable income. This budget includes not just grocery purchases but dining out: According to one study, the average American spends six percent of their budget on groceries and another five percent on dining out. Although the total of these two percentages is 11 percent, many experts recommend using 10 percent for food budget calculations since this number is far easier to work with, not to mention a tad bit more conservative.
That said, calculating your 10 percent monthly food budget isn’t as simple as just taking your monthly income and moving the decimal point one digit to the left. Instead, to plan your food budget, you’ll need to first subtract your other monthly expenses – rent, utilities, health insurance, student loans, and any other bills you know you need to pay – from your monthly income. The difference between your monthly income and expenses is your disposable income, from which you can then calculate your food budget.
Plan your food budget based on previous spending
After you calculate 10 percent of your disposable income, you can compare it to your previous food spending. If you realize that, in previous months, you’ve spent only eight percent of your disposable income on food, then you can easily stick to the recommended 10 percent. However, if you find that you’ve previously spent 12 percent of your disposable income on food, you have two options.
The first option is to commit to your new lower 10 percent budget, which you should divide into six percent for groceries and four percent for dining out. Alternatively, if your finances haven’t been strained by your previous levels of spending, you can keep going at your 12 percent food budget. The main point to keep in mind is that, though 10 percent is a widely recommended suggestion, you can be flexible with it.
Plan your food budget by week
Although you’ll plan your food budget based on your monthly income, you may find it easier to determine what food you’ll need for meal prep (or how many meals per week you expect to dine out for) on a weekly basis. Consider setting up weekly allotments for specific groceries and meals, and be sure to indicate the quantity and price of each item you expect to buy. A spreadsheet may be helpful for ensuring that your weekly purchasing plan keeps you within your budget.
Be smart at the supermarket
An easy way to overspend beyond your grocery budget is to go to the supermarket without a plan. Experts recommend showing up at the supermarket with a grocery list that you’ll strictly adhere to instead of just impulsively grabbing items you think you need. Additionally, a grocery list that prioritizes healthy foods, individual ingredients used to cook whole meals, and a variety of tastes and styles may feel more satisfying, in turn preventing you from overspending on items not on your list.
You should also be sure to take advantage of sales and coupons, though be careful not to overstock. You may also save money by knowing when to buy store-brand versus name-brand. While at the supermarket, don’t be afraid to spend ample time comparing prices – especially two items’ unit prices instead of their total prices – to get the best deal possible. You have all the time in the world to find the best deals – it’s your wallet where you might be limited.