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The Dead-simple Way to save 30% on Your Grocery Bill
The more effort you put in, the more you will save
One of the most painful ways inflation has hit our wallets is higher food prices.
But, before you go on Twitter and complain about the price of eggs, do something that will help yourself; make a plan only to buy food you will actually eat.
According to the U.S. Department of Agriculture (USDA), the average American family of four spends between $567 and $1,296 per month on groceries—$6,804-$15,552 per year. But, according to estimates from the Natural Resources Defense Council (NRDC), American households waste about 30-40% of the food they purchase.
Put another way, if we ate everything we bought at the grocery store, grocery bills could be as low as $340-$778 per month.
The quickest way to start saving money is to reduce food waste.
How much money you save by reducing your food waste depends on how much effort and planning you do before buying groceries. If you plan a little, you can save a little. If you plan a lot, you can save a lot of money.
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Want to save a little on groceries? Use Budgeting and shopping lists
Food and money are two areas where our decisions tend to be dominated by emotions. Research has shown that our decisions on what food to buy can be driven by how we feel at the time, the weather, and whether or not we use a shopping list.
Using shopping lists is one of those things we know we probably should be doing—but most of us don't use one as often as we should.
A 2020 paper set up two experiments to examine the effect of shopping lists on online grocery shopping.
In the first experiment, participants were randomly assigned to either write a shopping list or not before shopping online for groceries.
In the second experiment, participants predicted how much they would spend during the grocery trip, with and without a shopping list.
The results of the first experiment showed that people who wrote a shopping list bought marginally fewer items and spent a little bit less money on their virtual grocery trip than those who did not make a list.
The results of the second experiment showed that participants who made a prediction alone spent similar amounts of money and purchased similar numbers of items as those who made both a prediction and a shopping list.
This suggests that setting a budget for the shopping trip alone may have a similar effect on consumer behavior as making a shopping list. For example, committing to spend no more than $150 on your next trip to the grocery store is about as effective at moderating your spending as having a full shopping list.
A budget combined with a shopping list is better than either by itself.
Having a budget and using a shopping list for each trip to the grocery store can help you from making impulse purchases—but there’s still a critical piece missing; you need to ensure you will use all of the items in your cart before the spoil.
To do that, you must go further in your planning.
Want to save a lot on groceries? Match your shopping list to a meal plan
Even if you stick to exactly what’s on your shopping list, there’s still a good chance a lot of that food will get thrown out because you don’t have a plan for when you will eat it.
Think of the 6-pack of avocados you bought and only ate two of them. You planned on eating all six, but by the time they ripened, you had kind of forgot they were there, and by the time you were ready to eat them, they had spoiled.
Or think of the leftover casserole that got pushed to the back of the fridge—where it remained for six weeks.
So, if you want to dramatically curb your food waste, you need to have a plan to use everything you buy at the grocery store.
Here are some practical tips to reduce food waste and save money on groceries.
Having a weekly meal plan that fits within your grocery budget
Listing out the ingredients in that meal plan, this is now your shopping list.
Buying only what is on your shopping list.
Having a system for consuming leftovers. I recommend taking a page out of the accountant’s playbook and adopting a First In, First Out (FICO) method of having the oldest leftovers at the very front of the fridge and consuming them as quickly as possible.
Only buy in bulk for non-perishable items that are a regular staple in your diet.
Never buy something just because it’s on sale—paying full price for food you eat is always better than paying half price for food you throw in the garbage.
Is that a lot of work?
Do I expect everyone reading this will adopt 100% of these tips?
But this is not an all-or-nothing proposition. Even if you adopt one or two of these changes, you’ll throw out less food. Personal finance is a trade-off between time and money, so adopt the tips that optimize your trade-off between time spent planning and money saved.
I created a resource to help you save on groceries
Based on everything I wrote in this article, I created this grocery list/meal planner to help you reduce food waste and stay within your budget.
For each week of the year, this journal has space to plan your meals for the week, list out the ingredients in each meal and build your shopping list around those ingredients and stay within your budget for groceries.
This article is for informational purposes only. It should not be considered Financial or Legal Advice. Not all information will be accurate. Consult a financial professional before making any major financial decisions.