In today’s fast-paced world, managing personal finances can be a daunting task. In my years of coaching, I’ve observed that the food budget is most challenging across all income levels. That’s led to lots of frustration and feelings of hopelessness on the topic.
Whether eating out or purchasing groceries, food expenses have a tendency to spiral out of control if we’re not careful. And this seems to happen with food far more easily than with other budget items.
Let’s explore five of my top reasons why food is a category that frequently breaks the budget. I will also offer some practical tips for managing this essential aspect of our financial lives toward the end.
Rising Food Costs Break the Food Budget
A major reason for food budget problems is the ever-increasing cost of groceries. Factors such as inflation, transportation costs, and supply chain disruptions from the Covid lockdown all contribute to price increases.
As food prices rise, individuals and families often find it challenging to stretch their budgets to meet nutritional needs. For example, eggs are a staple part of many families’ breakfast diet. Remember when the price of a dozen eggs was around $5?
I took this picture at Aldi myself in early 2023.
Thankfully, things are correcting a bit over time. On June 11, this was the price of a dozen eggs at the same Aldi.
Nonetheless, many items are still much more expensive than they were a few years ago. While the reported inflation rate is in the single digits, food inflation is significantly higher.
And that’s especially so if the inflation calculation does not have a substitution component, and purely measures the rising cost of these goods without changes in consumer behavior.
These prices are something we can’t individually control. But we do have to respond to them while making our food budgets.
Lack of Meal Planning
Meal planning plays a crucial role in maintaining a balanced budget, yet many overlook its significance. Without a well-thought-out meal plan, it’s easy to resort to impulsive grocery shopping or frequenting restaurants.
While each purchase looked at in isolation looks insignificant, it all adds up over time. All it takes to lose $10,000 in a year is $27.39 of impulsive spending per day. And think of how easy it is to spend that amount on just one meal!
Additionally, a lack of planning can lead to excessive food waste, as perishable items may go unused or spoil before consumption. This is something I have dealt with a lot myself, much to our collective household chagrin.
By embracing meal planning, we can save money by buying only necessary ingredients and reducing waste. Especially if we plan out our meals, we can have leftovers for lunches or dinner the following day.
There’s nothing wrong with or undignified about doing leftovers!
Food Companies Are Marketing Geniuses
Food manufacturers and retailers are well-versed in the art of marketing. They know exactly what tactics to use to entice us to spend more. This ranges from packaging appearance, to where the product is located within the store.
All this marketing has a strong impact on our food budget if we’re not careful.
Think about it for a moment—have you noticed that staples like milk, eggs, and bread tend to be at the back of the store? There’s a reason for it.
They want us to pass by all the other items at least twice. This gives each product’s manufacturer at least two opportunities to entice us. Even if we’re just grabbing a few things, seeing these products and the various sales tends to draw us in to add just one or two more things to our shop.
It’s also why candy is at the register toward the floor. Kids are waiting for checkout and see what kids almost always want. This product placement is no accident.
Before we know it, we’ve increased our grocery bill by 20, 30% or more.
These unplanned purchases often extend beyond the necessities, causing the overall food budget to exceed what we intended. To counteract this, it is important to develop self-awareness and exercise self-discipline while shopping.
Focus on planned purchases rather than succumbing to marketing ploys. For further assistance on this, you may be interested in my guide to avoiding impulse purchases.
Lifestyle & Convenience Choices Can Break the Food Budget
Modern lifestyles tend to be fast-paced and demanding, leaving little time for meal preparation. As a result, it’s easy rely heavily on convenience foods. With the rise of services like DoorDash, the temptation to get convenience food doesn’t even require us to leave our house.
While these options offer immediate gratification and can save time, they usually come at a higher price point. Regularly indulging in these conveniences quickly erodes the food budget, especially compared to the cost of cooking meals at home
Balancing convenience with cost-conscious choices can help keep food expenses in check. But even deeper than this, it may be a good idea to reflect on our lifestyles as a whole and ask if we’re over-committed and doing too much.
All the activities outside of work and family add up. It’s easy to find ourselves always on the move. We have hardly a moment’s rest from the time we leave in the morning until we arrive at home later in the evening.
It’s okay to say no to things to free up time on our calendars and space in our minds. This is where our values come in and we have to set up boundaries with the world. When we set up and enforce those boundaries, we have more control over our lives, including our relationship with food.
Emotional and Impulsive Eating
Speaking of our relationship with food, emotional and impulse eating is a huge problem in American society today. Especially during the lockdowns of 2020, many people were shut in their homes. This inevitable led to emotional eating practices.
I can’t count the number of conversations where folks have said the easy constant access to their fridge was a huge problem for them. As of early 2021, Millennials had gained an astounding 41 pounds on average since the March 2020 lockdowns.
Turning to food for solace or as a coping mechanism during stressful times can lead to overspending on indulgent or unhealthy options. A lifetime of indulgent and unhealthy eating choices will not only break the food budget, but also increase healthcare expenses eventually.
Developing alternative strategies to manage emotions, such as exercise, meditation, or engaging in hobbies can help to mitigate the financial impact of emotional and impulsive eating.
How to Get the Food Budget Under Control
While getting food-related spending under control can be a challenge, there are lots of ways to keep these expenses down while still enjoying ourselves.
Here’s a rapid-fire list of ways to do that:
- Always make a list. Never go to the store without specific items that you are going to get. Make a plan before going into the store, and focus your attention on those items alone.
- Meal plan. There are tons of ideas on sites like Pinterest to help plan out meals for the week. In turn, this can help you make more targeted shopping lists, too.
- Buy in bulk and freeze. Purchase non-perishable items in bulk, such as pasta. You can make larger meals at once, and then freeze the leftovers for use at other meals.
- Ease off eating out as frequently. However much you’re eating out now, try reducing it by just 25% in one month, and then 50% in the next. You’d be surprised how much you’ll save by eating more at home.
- Avoid shopping on an empty stomach. Hunger can lead to impulse purchases and overspending. Grocery stores know this too! Guard your wallet by keeping those emotions in check.
- Make a detailed food budget. As a part of your financial practices, be realistic and detailed in your food budget. I recommend separating convenience food and grocery expenses to have a clearer idea of how much you’re spending in each category.
Final Thoughts on the Food Budget
Food is a huge part of our lives. Not only is it how we fuel our bodies, there is also an emotional and social aspect to it. When we gather with friends and family, it’s often over a meal. It’s hard to think of occasions with others where food is not somehow involved.
That said, we need to be wise consumers and think about how all the food spending temptations impact our long-term financial goals. As I mentioned earlier, each purchase may not seem like a lot on its own. But all of these spending choices add up over time.
We obviously have to eat, and we generally aspire to eat healthy. We can do that and keep a reasonable food budget in the process. For more tips on how to do that, check out a guest post from nutrition coach Shannon Stephens of Health Whipped Up.
What other ideas do you have for keeping your food budget under control. Drop me a comment below!