Yep, I said it, you need a grocery budget.
I know this isn’t a fun topic, but I do think it has to be mentioned. Before I start, I’d like to mention that my husband and I aren’t strict grocery budgeters. I aim for about $50 a week, or $200 a month for the two of us. This includes food and toiletries. I just added up what I spent on groceries in January and I was over the $200 mark by about $45. In January I happened to do a lot of stocking up. Chicken was on sale, I made a trip to our local flour mill and I’m now set for laundry detergent and the like for a couple months thanks to some awesome sales and coupons. I have a feeling that in February, I’ll be under budget.
So, back to why budgets are a good idea.
1. Without a budget, you don’t know if you’re saving any money. Sure, you’re probably saving money by shopping the sales and using coupons. But, in your effort to save money by using coupons and shopping the sales you’re more than likely spending more to save more if you don’t know how much you have to spend. For example, a person without a budget might see a deal on laundry detergent one week and buy a couple of bottles. Then next week, a different brand of laundry detergent is on sale so that person buys one more bottle, even though they won’t be needing any for a while because of last week’s purchase. Say that laundry soap was on sale for $4.99. Times that by three and that person has spent $14.97 in a two week period on laundry detergent when they really only needed to spend $4.99. All these “savings” really add up when you don’t have the boundary of a budget to work with.
2. A Budget will get you closer to your financial goals. Would you like to be mortgage free by the time you’re 50? Or, purchase a new-to-you car with 100% down? A budget can help with that. With a budget in place, you give every dollar a name thus helping you to plan a savings strategy to hit any financial goals you’ve set for yourself. You’ll know exactly how much you can save each month after all expenses are paid and how long it will take to reach each financial goal.
3. A budget will improve your spending habits. Once you start tracking (and seeing!) how much you’re actually spending in a particular area you’ll start to spend less each month. If you have no idea how much you’re spending on eating out each month, for example, you’ll probably be shocked when you start tracking it. You’ll start to eat out less, because you’ll recognize that you’re spending too much. In terms of groceries, a budget will help you to wisely spend your money each time you’re at the store. You won’t go overboard during the toothpaste sale if it means you won’t have enough left for milk and fruit!
4. A budget will give you a sense of freedom. I know, this one sounds strange, but hear me out. When you give yourself a $100 budget for clothing each month, and you’ve spent $50 of it already on new shoes you don’t have to guess whether or not you can afford the $49 jacket you spotted. Budgets are great for those who feel guilty about letting go of cash on possibly “frivolous” things. In terms of a grocery budget, a way to feel more freedom, is to give yourself $300 for the month instead of $75 a week, as an example. Yes, I know, this is the exact same amount when totalled. But say one week you spot a rock bottom price on ground beef, and it would be wise to stock up with enough to last until the next sale comes along because you’ll use it. In order to stock up, you’ll have to go over your $75 weekly budget. But if you budget $300 monthly, you’ll have the freedom to spend that money because you know the next time you shop, you’ll most likely spend significantly less because you’re already stocked up on a necessity. I hope that made sense!
I think I’ll end it there as those points relate most to the grocery budget!
How to Set up Your Grocery Budget:
1. Track your grocery spending. Track your spending over a couple of months and come up with an average. Or look at your receipts from the last couple of months to figure out an average. Once you’ve figured out what you spend on average, you’ll want to trim that amount down, since I’m pretty sure you’re here to learn how to spend less on groceries!
2. Start slowly. I don’t recommend drastically trimming your grocery budget right this instant. Give yourself some slack and don’t put pressure on yourself to come up with an impossible-to-stick-with number. You’ll get discouraged and may end up giving up.
3. Challenge yourself to reduce your average slowly. Over the following months and with some trial and error, you’ll most likely start to see your grocery budget lower with a bit of work. Start thinking more creatively on how to transform basic ingredients you find on sale into delicious meals or start making more from scratch.
Do you have a grocery budget? What are some benefits you have noticed with having a grocery budget? Any advice for newbies?
Watch for the next post in this series on Wednesday. Missed the last posts in the series? Here they are:
- Trim your Grocery Bill – Commit to Make a Change
- Trim your Grocery Bill – Sneaky Ways Grocery Stores get you to Spend More