Is your food spending “normal”?
What you spend on groceries depends significantly on your family’s makeup, your dietary needs, and your lifestyle.
Maybe your busy life means outsourcing your food prep and grabbing convenience items. Maybe you gravitate toward organic produce. Or you need to grab gluten-free products. Perhaps you’re a die-hard meal planner and committed couponer.
No matter what your situation, you probably want to know . . .
How much should I spend on groceries? Is my family’s food budget on target, or are we way off?
So let’s peek into kitchens — and wallets — across America! We’ll see how much American families are really spending on food.
Keep reading to learn how you can create and customize a food budget for your family. And don’t forget to grab your FREE food budget calculator down below to compute your family’s ideal grocery budget!
1. Check your budget percentage.
How much should you spend on groceries? According to the U.S. Bureau of Labor Statistics, Americans devote 11% to 16% of their budget to food each year. Keep in mind, these percentages include costs for both food at home and dining out.
So, if you’re sitting around the middle at the 14% mark, weekly food expenditures would look like this:
|Monthly After-Tax Income||Weekly Food Budget|
To figure out where you land in this table, estimate your own monthly after-tax income.
The easiest way to do this? Just take a look at the amount of money that hits your bank account each month. Or add up your income over the last year and divide by 12.
2. Compute your budget through the USDA.
Did you know that the USDA publishes reports on the cost of food every single month?
Yes, that sounds pretty dull! But the report is actually an immensely valuable tool for evaluating your family’s food budget.
Here’s what I mean:
Each report is simply an easy-to-read, one-page chart that gives you four possible “eating plans” — Thrifty Plan, Low-Cost Plan, Moderate-Cost Plan, and Liberal Plan.
The footnotes in the report offer details on what each plan is and how it’s determined. But the general idea is that each plan reflects at-home food costs for healthy diets of meals and snacks.
Within each food plan, you’ll find weekly food costs for each family member, broken down into age and gender groups.
The calculations for my family
To show you how it works, I’ve calculated my own family’s weekly food budget using the June 2020 statistics. There are four possible plans, but I’ve crunched the numbers here for the lowest- and highest-cost plans:
- Female (19 to 50 years): $40.00
- Male (19 to 50 years): $45.10
- Child (5 years): $26.40
- Thrifty Plan Weekly Family Food Budget: $111.50
- Female (19 to 50 years): $79.40
- Male (19 to 50 years): $90.20
- Child (5 years): $49.80
- Liberal Plan Weekly Family Food Budget: $219.40
Clearly, there’s a huge range in budget between Thrifty and Liberal. For my family of three, the Liberal Plan is nearly twice as much as the Thrifty Plan!
Average grocery bill for a family of 4
Let’s do another example.
Consider a family of four. Both parents fall in the age range of 19 to 50. We’ll give the two kids ages of 2 and 6. Use the Food Budget Calculator now to compute the weekly grocery spending targets.
The USDA suggests that a family of four spends the following amount of money on food each week:
- Thrifty meal plan: $144
- Low-Cost meal plan: $190
- Moderate meal plan: $230.90
- Liberal meal plan: $282.90
So, using recent data from the USDA, the average food bill for this family of four is between $144 and $282.90.
A quick note
With all your calculations, keep in mind that these figures are averages. So they represent middle-of-the-road food costs for the country as a whole. Some areas have far-from-average costs for produce, meat, dairy, etc. And some families — maybe yours — have special dietary needs that drive up costs.
The end result? These numbers are merely a guide. And your own food spending might legitimately look pretty different, even if you’re already making smart spending choices when it comes to food costs.
3. Now figure out what you’re actually spending.
If you’re not already tracking your spending on groceries, it might be time to start.
An easy way to approximate your food costs if you’re a credit card user is to visit your cardholder’s website. Many credit card sites now automatically categorize purchases, based on the retailer from which you made the purchase. So you can get a quick and dirty estimate of food spending with just a glance.
Keep in mind, these reports aren’t necessarily that accurate. Your cardholder, for instance, might guess that your big expense at a supermarket was for food and not that pricey prescription you picked up.
If high accuracy is a priority, download the last few months of your spending and do some custom calculations of your own. Even better, start taking notes from your supermarket receipts and restaurant bills going forward.
Whatever approach you take, take a good look at your family’s numbers when you’re done.
So . . . how much are you spending on groceries?
And what percentage of your food costs are for dining out? (The Bureau of Labor Statistics reports that 43% of Americans’ food expenses are for “food away from home.”)
That number is huge!
Remember: Ready-to-go food purchased outside of your home at a restaurant, deli, coffee shop, etc. tends to come with a massive markup over homemade food. So, if you’re looking to slash your food budget, try making more of your meals at home! It’s an incredible way to reduce your food costs dramatically.
4. Determine your own ideal food budget.
At the end of the day, it may not matter if you’re spending less on food than the average American. If you’re struggling financially or saving for a big goal, you need a budget that works specifically for you and your family.
So take an honest look at your financial goals and your overall family budget:
- What’s unique about your area or the economy right now that might drive your food costs up or down?
- What special food needs (or wants) does your family currently have?
- What are your other spending priorities?
- What about your savings goals?
- What steps can you take to reduce your grocery spending?
- How can you slash your other regular expenses?
- Where are inadvertently hemorrhaging cash? And how can you stop the leaks?
Your family and your finances are unique! So budget for food with your goals in mind.
How much does your family spend on your groceries each month?
Updated after original publication in October 2016