How To Figure Out Your Monthly Food Budget

Some recurring expenses in your budget are the same each month, which makes them easy to anticipate. But some budget lines are harder to keep consistent — food, for instance. Food is a necessity, after all, but it’s possible to spend way more than you need to. With some research, you can figure out a realistic range for your budget.

Find the right per cent for food in your overall budget 

When you first set up your budget, start out by adding your fixed, necessary expenses and your savings goals (pay yourself first!). Then see how much you can allocate to variable and discretionary expenses. Food will fall into that category, and obviously shouldn’t exceed your remaining budget for variable expenses.

If you just want a quick gut check, take a look at your past food spending. What per cent of your take home income goes to groceries, eating out and take out? If food is around 10 per cent of your income that’s left after taxes and fixed expenses, your food spending is much like the average person. If you’re spending more or less than that, it might not mean anything, because everyone’s situation is different, but you might want to look at your other spending categories to see if there’s some imbalance.

If you want to fine-tune your plan or compare your spending to some actual food budget numbers, let’s continue.

Compare your food spending to others  

If you want more detailed data, the Australian Securities & Investments Commission released a report in 2016 that tracked the weekly spending of the average Australian. Per week, lone people under age 35 spent $122 on food, while couples with kids spent up to $332 per week. Compare your budget against these statistics to see if you’re on the right track.

Track your spending and update your budget

If you’re still having trouble choosing the right number for your budget, consider starting from zero. Instead of shoe-horning your grocery shopping into a number that might feel arbitrary, spend a month tracking what you buy — and how much of it actually gets used. Then use that amount as your basis for next month’s budget, and continue to adjust as seasons or household events demand. It may help you to review your grocery purchases separate from the money you spend on dining out or delivery.

Once you know what the normal range is for your household, you can take action to reduce that amount if necessary. You might discover that meal planning is the best way to keep your budget on track. If you’re someone who eats takeout or delivery a lot and find that it doesn’t fit into your budget quite right, you can look at ways to pare that back without cutting it out completely.

This post was originally published on 23/2/2012 and was updated on 17/10/2019 to include more thorough and accurate information.


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