How to Make a Food Budget

Making a food budget does not need to be difficult. It can even be fun!  Especially if you like a challenge.

Make a Grocery Budget

The hardest thing may be to simply be realistic.   You need to find a happy balance between saving money on food and making sure you and your family enjoy mealtimes.

What to Consider when making a Food Budget

  • Number of family members – more family members means more dollars for food – so how many people are you going to be feeding?
  • Favorite foods – what is each family member’s favorite food(s)?
  • Food restrictions – do any of your family members have allergies or other food restrictions?
  • Cost of groceries in your area – the price of groceries can be very different from town to town, or city to country, etc.
  • Time you have for cooking – do you have time to cook most family meals, or do you need to focus on buying some prepared items?
  • Are there any other items that you need to consider for your family?

Everyone’s food budget is going to be different, but we can all use the same steps to create a food budget.

3 Steps to Create a Grocery Budget

Making a Food Budget – Step 1:

The first step in creating a food budget is to figure out how much you currently spend on food.  If you don’t already know the answer to that question, the best thing to do is to track your food spending for the next 2 weeks.

Don’t change any of your food purchasing habits.  Just track what you spend. You can easily do this on a sheet of paper.  Just make 3 columns:  Date, Grocery Store & Amount, Restaurant & Amount.  

As you or any family member spends money on a food item, add it to the list.  At the end of 2 weeks just double that amount and you’ll have a good idea of how much of your money is currently being spent on food each month.

Why Separate the Eating Out Amount?

You may be wondering if it is necessary to separate the eating out amount from the groceries.  The answer is yes, and here’s the reason.  It can be a real eye opener.  Many families do not realize how much they are spending on eating out each week.

People have told me that they think that it’s cheaper to eat out than it is to make the food themselves.  That may be true in some cases, but not usually.  As prices are increasing at the grocery stores, the same is true for restaurants.  Let’s look at a simple fast-food example – for a family of 4, a typical fast food restaurant bill would be $45 for burgers, fries and a drink for each person.  If you made the same meal at home, it would likely cost less than ½ of that amount.

Now there are some good restaurant deals out there, so I’m not saying to never go out to eat.  We’ll share some ideas for eating out later.

Let me share our story as a real-life example.  It’s not pretty, but it’s real.  When my husband and I got married many years ago, he was a fast-food restaurant regular (almost every day).  I was not (once every 2 -3 weeks).  Our work schedules made it easy for us to compromise somewhere in the middle (actually it was quite a bit closer to his normal). 

Our new norm for eating out became 4 -5 times a week.  As you can imagine, this quickly became a large portion of our budget.  After about 2 months, we recognized what this bad habit was costing us in dollars and the resulting unhealthy meals.  We knew we had to take action to decrease the number of times we ate out each month.  We were about to cut our food budget by almost half  the next month by making a Grocery Budget and following many of these Food Budget Tips. 

Making a Food Budget – Step 2:

Now that you know how much money you are spending on food each month, you can begin to work on your Food Budget. 

Does the amount you are spending on food seem too high?

It is recommended that our food each month should be about 15% of your take home pay.  So, if your family is bringing home $3000 a month, then a possible amount would be $450.  Keep in mind that this percentage doesn’t work for everyone, but it is a good place to start. 

You also need to consider your family’s income and other expenses each month as well, find an amount that will work for your family. 

Do the math:

  1. Double the amount of money that you spent on food in the past 2 weeks. Write it down. That will give you an idea of how much you are spending for food in a typical month.
  • Multiply your take home pay times 15%.  Write it down. 
  • Now, subtract the 15% amount (B) from your current food expenses (B).  Is it higher or lower?  If it’s lower, you’ve got a great start already. 

With these two amounts in mind, consider how much is reasonable for you to spend for food each month?

Factors to keep in mind:

  •  What you currently spend on food
  • The 15% recommended amount
  • Your other expenses

Know your Reason / Know your Why

There’s one more important factor to keep in mind, because it will help you stick to your Food Budget.   You need to know your reason for creating a Food Budget.

It can be difficult to make the changes in your lifestyle necessary to reach a goal if you don’t have a reason for doing so.  For example, people choose to go to the gym to lose weight.  Or, people may start waking up early to make time for their Daily Quiet Time because they want to grow spiritually. 

When you know your Why – Making changes is easier.

What is your reason for making a Food Budget?  It might be:

  • There’s not enough money at the end of the month
  • We need to replace our stove (or frig, or roof, etc.)
  • To take a vacation
  • To pay other bills
  • We need to make healthier food choices

Now that you know your Goal Food Budget amount, let’s look at habits and tips that you can adopt to meet that goal.

Making a Food Budget – Step 3 – Choose a Food Budget Amount

Now, you have all the information you need to create your own Food Budget.  Consider all of the factors noted above, and any others that you may identify on your own.  Choose what your Food Budget amount is.  You can tweak it next month if you find it just won’t work.

Everyone’s Food Budget amount is different.  These are just some guidelines and ideas to help you get started.

Take Action

Begin to follow your Food Budget immediately.  You can take lots of different actions to help you stick with your Food Budget.  There are many Food Budgeting Tips, such as Meal Planning, Shopping Smart, Eating Out Wisely. 

You have to start somewhere, so just go ahead and make a Food Budget and then start taking actions.  You’ll be a pro at Food Budgeting before you know it.

Continue to Track Your Food Expenses

Be sure to continue to track the funds you spend on food so that you will be certain that you are sticking with your Food Budget.  You can do it with a paper and 3 columns just like you did for the first two weeks.

Another option is to use an online app or even just a notepad on your phone. 

A final option that is one of my favorites is to use an envelope.  Simply write Food Expenses on one side and on the other side, list your food expenses daily, adding them up along the way.  That way you’ll know how much money is left in the Food Budget at any given time.  Put the receipts inside the envelope if you wish to keep them.

Choose whatever method works best for you.  Enjoying the method you choose will help you stick to your Food Budget.

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