31 Days to a Better Grocery Budget: Yes, You Need a Budget

“A budget??”

I can hear the groans right now. You were all pumped about these great new money-saving ideas you were going to learn and implement from this series; the last thing you wanted to hear about was a boring topic like budgets.

Remember how you promised me yesterday that you were going to stop making excuses and commit to change? Well, setting up a budget is your first opportunity!

Why You Need a Budget

Without a budget in place, all the money you save is pretty superficial. I’d go so far as to say that without a budget in place, bargain-shopping, coupon-clipping and deal-hunting are likely not going to save you any money. In fact, you might be spending more money in an effort to save money–which totally negates the savings, right?

A budget gives you the ability to track your spending and saving–and hopefully to see an increase in savings and a decrease in spending. Without a budget in place, your money will just be running through your fingers with no set objectives. A budget gives you parameters and purpose, it gives you boundaries and it gives you freedom to live creatively within those boundaries.

How to Set Up a Workable Grocery Budget

1) Average Your Grocery Spending From the Last 4-8 Weeks

How much have you spent at the grocery store over the last 4-8 weeks? Average that amount out and use it as a basis for your initial grocery budget. Ultimately, you’re likely going to want to whittle it down quite a bit–since saving money is one of the big purposes of having a grocery budget!–but now is not the time to worry about that. It’s a huge step just to start with a concrete budget in place.

2) Be Realistic

Don’t put undo pressure on yourself to come up with some crazily-low and impossible-to-stick-with figure for your grocery budget. This is not a contest or a competition and if you want to persevere and see long-lasting benefits, you’ll want to give yourself some breathing room.

3) Challenge Yourself to Slowly Lower Your Budget

Over time and with practice, you’ll likely be able to reduce your original grocery budget figure fairly significantly. But just remember: it takes time. You’re not going to cut your grocery bill in half this month. However, if you slowly shave off 5% here and 5% there, within 6-10 months, it’s very possible you can have it lowered by 30-50% or even more.

Always give yourself grace, though. If you’re ever feeling frustrated or stressed about it, step back and remind yourself that it’s just a grocery budget. The world’s not going to come to an end if it’s $5 or $10–or even $30 or $50!–more than you’d like it to be.

What benefits have you found from sticking with a grocery budget? What advice would you have for someone who is brand-new to the idea of budgeting? Tell us in the comments!

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Comments

  1. Jen D says

    I read one of the books on your list for 2010 – “America’s Cheapest Family Gets You Right on the Money” after I saw it on your list (didn’t buy it – checked it out from the library). While I didn’t feel it was the best use of my time (most of the tips were pretty obvious and stuff I’m already doing), the one thing I did take away was how they do their budget. I had talked with DH about creating and really sticking to a budget a while ago, but he wasn’t too interested and I didn’t push it. Now, his income has been cut 10%, we’ve had to put a new engine AND transmission in his truck, a part in the furnace died, the dog had to go to the vet unexpectedly, etc; we’ve agreed to sit down TONIGHT to put together a rough draft of a budget. It’s going to be tougher than he thinks (and probably me too) but we need to do it. We make good money (even with the 10% pay cut), but we still seem to be just getting by. I want to pay down our mortgage and we just can’t seem to get the funds to add to the payments monthly. So…long winded way of saying “thank you”. I would never had read that book without seeing it on your list. Just got the Tightwad Gazette (also on your list) from the library this week. :-)

  2. says

    okay, I’m ashamed to say after 20 years of marriage my husband and I have finally sat down to discuss our budget. We’re in debt, bringing that down, but (long story short) never discussed what we spent and the debt lingered while the tension mounted. Doing taxes this year put me over the edge (I’m the check-writer) and after a heated discussion we set down without the emotion to earnestly work toward wisdom and frugality. I NEED THIS! Thank you and a question: I have read many folks say their monthly budget is around $200. I just calculated mine to be just over $800!!! Actually that’s not a budget – that’s how much we spend. But I also read most have young families with 1-2 maybe 3 kids. I have 4 teenage/young adult persons, beside my husband and me. What is a realistic grocery budget? Does this only include food? What about household/toiletries/animals? Thank you again. You have saved me over and over.

    • says

      @Barb, We have 8 people in our family (2 adults, 2 teens, 2 pre-teens and 2 younger kids) and if things are really tight, I can get by on $80 a week (only because I stockpile at rock-bottom prices). I used to spend much more. (This does not include cat food or rabbit food for our pets. I buy that at Walmart, which is by far the cheapest place I have found for pet food.) If you build a stockpile of things you often use (ex. shampoo, cereal, meat/chicken) when they are at the very lowest sale price, I would bet you can cut your grocery spending by quite a bit. I used to spend about $200 a week. (My struggle is to not go overboard with the stockpiling. I don’t even buy shampoo anymore unless I can get it absolutely free—as in nothing OOP—because we have so much!)

      • Crystal Freeland says

        @Andrea, Andrea, I feel you on the shampoo! I bought a ton of it last year for maybe 10 cents a bottle, and am stocked up. It doesn’t go bad, but like you, I won’t go get more unless it’s completely free. We have a budget of $100 per week for a family of 5. This doesn’t include tp or diapers, etc. Just food. But in actuality, we only need about $75 a week to provide us with our needs, so that extra $25 a week goes toward buying up bulk food and spices/teas. If you put away just $25 a week, you have $1300 extra a year to buy up canned chili when on sale, or bulk-purchased potato flakes (I just paid only $40 for a 40 lb bag, will last a year.) It’s tempting to pocket that $25 a week for something else, like a vacation, and I guess you could do that. For us, it makes more sense to treat the household like a business. You roll over the funds into future investments to save money.

    • says

      @Barb, Oh, and I forgot to mention…for things like toilet paper I can never seem to find a really good deal. So I go to a store like GFS and get it there cheap. It’s a restaurant supply store open to the public. You may have something similar. I like it because you can get big quantities of things like TP and pasta really cheap, and there are no membership fees.

      • Crystal Freeland says

        @Andrea, Barb, I bought an Entertainment book and found GFS coupons in there!! I decided the book MORE than paid for itself with just a couple of coupons used, and also have been buying White Cloud tp (4 dbl rolls) at Walmart for $2 a pkg. I combine that with $1 off coupons, and get the equivalent of 8 rolls for $1, plus about 10 cents per coupon. So I will spend $22.00 for 20 packs of tp (8 roll equiv. in each) and the cost of coupons. That’s 160 rolls’ worth for $22. Better than GFS.

  3. Andrea Schrock says

    Crystal, When considering a grocery budget should I include the cost of diapers (and wipes) in that budget? I have two children (1 yr old and 2 yr old) in diapers currently thankfully they are in the same size so I only buy size diapers.
    I love your site, it has encouraged me and has helped me save so much on items we use everyday!!!

    Thank you,
    Andrea

    • Jenn says

      @Andrea Schrock, I found it easiest to only count what we could put in our mouths in the grocery budget. The math and receipt tracking is much easier. Especially if you shop at a Target or Walmart for toiletries and other stuff. Subtracting out the other stuff is a pain. So the other part of that rule is to only buy groceries at the grocery store. Again, easy math. And you’ll get better selection and prices buying toiletries elsewhere.

  4. says

    I’m amazed at how little we now spend on groceries and personal care items. Our weekly budget is $50 for both. For a family of four. We started cloth diapering before our financial crunch and I’m so glad that we did. It saves us so much money with one in diapers full-time and one part-time.

    A couple years ago we knew that our budget needed to be that, but I laughed because I thought there was no possible way. It is! Part of my accountability is posting my budget on my blog each week. Now we have even more incentive, because we’re on the road to adopting from South Africa.

  5. Jennifer says

    I used to be so overwhelmed with finances; we both graduated with our Bachelor’s degrees (debt free!), had a baby a month later, and moved across the country 2 months later, and I just couldn’t handle it. I had tried a budget before, but somehow we had just always scraped by with God’s grace. Now that I stay at home with our amazing little boy, I’ve taken the time to sit down, categorize our spending, and go over it with my husband twice a month. Finances were the biggest problem in our marriage; we tried not to fight or use angry words, but there was certainly tension any time the “budget” word was used. Now that we can discuss it calmly and brainstorm ways for improvement, we’re both so relieved and the tension is gone! Plus, we get to celebrate together when we do well, and we get to pray together when we need help. It has become a huge source of strength in our marriage to use a budget.

  6. says

    I definitely groaned. Quite loudly I might add! But I think this article is right on target and exactly what I need to do. I never keep track of how much money we spend on groceries. I’m sure this will be a wakeup call but more importantly, a good starting point to getting my budget under control. Thanks for the great article!

  7. Sara says

    Our budget has lifted a weight off my shoulders that I didn’t even know as there before! This month we made out our first detailed budget (after five years of marriage and one kid, it was long overdue!). There is so much freedom in knowing how much I can spend on groceries, clothing, restaurants, and entertainment. I no longer have to worry if a purchase will keep us from not making a bill payment or putting a sufficient amount into our savings. And the funny thing is, we have more than I thought! It’s almost as if we’re making more money just by having a budget! A budget helps me make wiser purchases and weigh the cost of making that purchase.

  8. Danielle says

    I enjoy reading your blog so much. Thanks so much for all of the help you provide to people. I do have a question. We are a family of five. Two girls and one boy. Ages 4, 6, & 8. What do you think is a realistic amount to set for a grocery budget? In other words what do you think my goal should be to get my budget down to. I would say I spend around $150 every two weeks. I would greatly appreciate your input.

  9. Stephanie Sample says

    Thanks for this great information. I’ve created a rough draft budget and plan to create my envelopes for using cash for day to day living. Can you give me suggestions on how you set up your budget? Does anyone have a simple form they use?

    Thanks!

  10. says

    I’m sorry to say that I don’t have a budget either. I over buy because it is a great sale or even free. But I too have alot of waste. I am going to set a budget right now and TRY to stick to it. I usually spend $200-$250 a month on groceries(getting $400-450 worth of groceries) but not needing all that. It is only my daughter and I. So from right now on I am budgeting $40 a week for groceries and my goal of having it to $30 a week within 6 months. Thank you for all your great posts. You inspire me to be a better person allaround. Thanks :) Amy

  11. AnnJo says

    This post and its comments came just at the right time for me. Over the past year, I’ve started keeping a price book and couponing, which has dramatically lowered the cost-per-item on our grocery and supply list, but I also made a commitment about thre months ago to build up our pantry to give us at least six months’ worth of our basic meal building blocks (pasta, rice, beans, tuna, canned tomatoes and veggies, oils, soups, spaghetti sauce, bath tissue, cleaning supplies, condiments, etc.).

    The result was a pretty big leap in our grocery/supplies spending. I now realize I should have budgeted for this “stocking up” program and allowed for it to proceed more gradually. Part of the goal is to not have to be like the middle-class looters we are seeing in the aftermath of the Chile earthquake in the event of a local emergency, but that goal was adequately met when we reached the one-month reserve. The other part of the goal – long-term savings – shouldn’t come at the cost of totally blowing our current spending.

    Time to sit down with the calculator!

  12. Jenn says

    I’d recommend to get started setting your monthly budget right at what you’re currently spending, if you can. Because then it’s an easy win when you spend less. Once you get better at some of the strategies you can go lower for the budget but I’m all about easy success for the tough things.

    And keep in mind that there are 4.3 weeks in a month. If you divide your monthly budget by 4 you’ll end up short-changing some weeks or mysteriously going over.

  13. elizabeth says

    I think the idea of a grocery budget is a great idea; however, I think food should be a significant part of your total spending. In this country we spend about 10 cents of every dollar on food and 20 cents of every dollar on health care. A lot of that spending on health care is because we eat such junky food. Spending as little as you can on food tends to lead to spending more on health care later down the road– to to mention a lot of sickness and disablilty. My grandmother would call that “penny wise, pound foolish.”

  14. julie says

    Crystal,

    Thanks so much for this post and the month-long topic. You do a great job challenging and encouraging people! I’m so thankful for the way God has used you and the blog to help teach me over this past year.

    I started couponing w/ sales last January in an effort to cut our grocery bill. I saw results right away but it wasn’t until recently that I’ve seen the drastic results I’ve been working towards. Before Jan. 2009 our family (of five) grocery budget was over 500/month. For the first 5 months of last year I averaged $460/month. I was saving but not saving enough. I started making everything from scratch and then meal planning as well. The combination of those 3 disciplines (couponing w/sales, scratch cooking and meal planning) has yielded so much fruit for our family! For the last 3 months our food budget has not exceeded $250!!! (That’s with me making 3 meals/day 7 days/week for the whole family.) And you should see my freezer!! It’s FULL! We are eating whole foods, with the exception of a couple of boxes of whole grain cereal, and have lots of variety in our menus. I am thrilled and so very thankful to see how God has blessed my efforts and has given us grace. It is possible that our family may go through a period of unemployment in the near future, but we are not afraid!! We know that God is sovereign and he will provide. He has provided already thanks to a pumped-up emergency fund and the knowledge of how to provide for a growing family on significantly less! Thanks for all you do, you’ve been a blessing to our family!!

  15. Emily says

    My husband and I have tracked our spending for most of our marriage, but only truly started budgeting about 2 years ago when he started vet school. We are pretty frugal people and typically have to be encouraged by the other to spend money even if it’s something we need. With that said, I really like having a budget because there are times when I want to buy something special and I used to feel really guilty about it, but now I don’t because I know when we can afford it and then it’s okay to buy it. I track sales really well and am trying to use more coupons, but I have found that having a meal plan has helped me the most. When I go to the store I know exactly what I need to get and we have plenty of food to eat and eat a variety of meals. I have a 15 month old and when he started eating solids I was really upset about our food budget, but have come to understand that it needed to go up to account for him, but with meal planning it has only gone up a touch.
    I do have a couple of questions. One, I know that where you live influences grocery prices, but is there some general idea of what people should be spending based on family size? Two, why do so many people include non-food items in their grocery budget? I feel like our food budget is reasonable, but not when compared to others who are including these non-food items.
    I’m all for lowering our budget to help us through school so thanks for your tips!

  16. says

    I recently taught a class at church at lowering your grocery budget. I think having a realistic goal is essential. You can’t meat a goal you haven’t set. That little bit you save each month really can add up!

  17. Kim says

    We’ve been on a set budget for years now. I plan my meals each week, take cash only and use a calculator. I also figure in sales tax so that I know just how much I’m able to spend. When our grocery money is gone, its gone. It has worked amazingly well for us and now the thought of shopping without a calculator seems crazy! ha I found one at the $1 store that hangs on my neck…its fabulous!

  18. says

    We’re friends with a couple who have had some serious financial difficulties the past few years. The wife wants to budget, but the husband refuses because it might limit his fun. I’ve told him that budgets are actually very freeing; you know how much you have to spend, so you plan more carefully, whether it’s entertainment, eating out, buying groceries, etc. My husband and I learned that budgets make us more appreciative of the things we choose to spend money on. Funny how it works.

    I’ll never truly understand why budgets are so frightening to people.

  19. says

    Recently I’ve been more diligent about sticking to our grocery budget. I’ve been using coupons for years but I was still going over our budget each month. I reconciled with myself that it was OK because it was a $.50 here or $.75 there. I told myself that a little over each month wouldn’t matter because I had found a great deal. Then in December I started reading moneysavingmom where I was introduced to Dave Ramsey. I had never heard of him, and like many people, my husband and I thought we were super frugal. After reading Dave’s books and following Crystal’s financial goals series, our family is 100% committed to staying on a budget. The biggest help as far as our grocery budget is concerned has been paying for everything in cash. I am happy to say that in February our budget was under by $15. We are not starving or going without wonderful produce or wholesome food. The real difference is that I am more committed to finding the best deals for my family.

  20. says

    I would say find recipes that don’t have expensive ingredients. If you’re on a budget you can’t eat filet mignon or lobster every night. Find some recipes that are inexpensive and easy. (You have a lot of great recipes, Crystal!! I have some good ones on my blog…we have 7 kiddos…we have to eat inexpensively!) We spend around $150 a week on our grocery budget and that includes diapers, health and beauty and cleaning.

  21. says

    I have not read all the comments and am a day behind. However, I suggest setting an annual budget, or at most, a monthly one. I’ll also suggest that if you are just starting “pantry principle shopping” that you may also need to set some extra money aside the first couple weeks. Those of us who shop coupons combined with loss leader sales have weeks when we find alot of things and weeks when all we buy is milk and produce. If you are starting out now, Easter will probably have a lot of sales to take advantage of.

  22. says

    Of all the areas to budget, groceries have continually been the hardest area to stick within our budget amount. My wife just attending a …well, I’m not sure what to call it, it was basically a get together with her friends and she learned how to save big using coupons. She ordered 5 subscriptions to the Sunday paper. Here’s hoping this new strategy really helps :)

  23. Jennifer says

    Wow, lots of comments about budgets. (Back when I was a CPA, discussing budgets wasn’t nearly this popular!)

    What works better for us is not to have a weekly budget, but rather monthly or every 3-4 months. We live in a rural area and I although we make it to the store weekly for the basics (milk, produce), we do the bulk of our shopping once a month. There’s also certain things I buy only at SAMS, but we’re only there every 3 months or so. I keep track of how far under budget I’ve been in previous weeks to know how much I can spend on the bigger trips.

    I’m also inclined to stock up now on a good sale rather than wait for it to come around again. Since I’m doing most of my shopping only once a month and I only have 2 stores to choose from, there’s a pretty good chance I’ll miss the next time a particular item is on sale.

    Question: Do you keep your grocery & household items (shampoo, toilet paper, etc) as seperate budget categories? My last trip into town, I bought a variety of things (present for son’s b-day, shoes for hubby, groceries, etc) all at one stop. I took a few minutes to break out the present and shoes when putting them in Quicken, but it seems it would be too time consuming to break out household items from groceries (and figure the tax for each) each time I shop.

  24. Ashley says

    We have been living on a budget for the last few months and my grocery bill either busts my budget or I feel stressed a lot of the time because I know we’re almost out of money in that area. I buy almost no processed foods and I’m wondering if that is why my monthly groceries are so high. We’re a family of 6 (the youngest on formula and 2 babies in diapers – cha ching!) and I’ve got a $600 a month budget for this area. The normal coupons that circulate don’t help me very often…do you have any suggestions for staying with our healthy eating and cooking while still saving money? Thanks a ton!

    • says

      Yes, stayed tuned for the rest of this series. We’ll be talking about a whole lot of things you can do besides coupons. :)

  25. Margaret says

    Great post – thanks.
    I started couponing last June and I’ve already seen some huge savings. I am tracking my monthly expenses.
    We were spending WAY more than the tiny budget mentioned by some of you super savers – but I’m working on it.

    I love the idea of challenging yourself to a lower budget. I think this is my next step in lowering my budget!! Some small incemental changes over the next 6 to 12 months will really make a difference, I’m sure!

  26. Joanna says

    I have a question about your budget (and I hope this isn’t redundant from an earlier post, etc) – does your grocery budget include only food, or household items as well? I feel like I spend so much each time I go to the grocery store but I’m realizing I don’t actually spend that much on food – a lot of what I consider grocery spending is actually on household items. Anyway, I’m following the series and hoping it will help, but was curious about that. Thanks!

  27. says

    I have a $50 a week grocery budget for my family of five-this also includes toiletries/HBA and household goods like paper products and cleaning supplies. I also bring in cash at the store-our checkbook and debit cards are locked in our safe :) We now eat much healthier than when I had a bigger budget-I’ve really cut back on the junk food and processed meals. Great series!
    sara http://myfrugalfunlife.blogspot.com/