When ever we start looking to save money, the first place we tend to look is the grocery budget. One of the reasons we do this is because, unlike a house payment or a car loan, grocery shopping is a true variable expense. It?s an expense we have a large measure of control over which makes it a natural target for reduction.
It can be a rich source of savings as well. If you normally average $200 per week on groceries, and you can cut that by 20%, or $40, you can save over $2000 per year. There aren?t many expenses you can cut to save so much money without experiencing real sacrifice either.
Grocery shopping is a multifaceted endeavor, so there are a lot of ways to save money. I?ve come up with a list of 15 ways to cut your grocery bill that my wife and I use on a regular basis:
1. Don?t buy prepared foods or individual servings. As a general rule, the more a food item has been processed, the higher it?s price. You can buy uncooked rice in 10 pound bags for not a lot of money, or you can buy instant rice in those boiling bags, and you?ll have spent a good deal more in exchange for at best ten fewer minutes at cooking time.
2. Avoid buying for the ?cool factor?. Any food item where the primary construct of the product is geared mainly toward convenience or appearance (the ?cool? factor) will cost you more. Over packaging seems to be an integral part of this, giving the appearance of greater quantities than there really is.
3. Never shop at meal times or when you are hungry. This one is almost a clich?, but it?s worth mentioning. Not only will you buy more if you?re hungry, but you might unconsciously buy junk foods, the kind that we tend to look for when we need a quick bite but don?t have a lot of time.
4. Shop on the quietest shopping days. I favor control when shopping?the more of it I have, the easier it is to focus on getting the best deals and sticking to my plan. But shopping in a crowded store flies in the face of this. You will not be able to concentrate if you?re surrounded by people and noise. Monday and Tuesday nights seem to be the best days to shop, I can glide in and out of the store in the shortest amount of time and find exactly what I want in between.
5. Where possible, buy larger sizes and quantities. Small sizes may look pretty and work just right, but they tend to cost more. Buy in bulk when ever you can, and break the quantities down to smaller more usable sizes when you get home.
6. Buy on sale and buy in bulk. When ever there?s a sale on an item you regularly use, buy as much of it as possible and store it or freeze it. This may require that you have a freezer or second refrigerator?either of which you can buy second hand?as well as a cool, dry storage area. The more you can buy at any one time, the few shopping trips you?ll need to make. Which brings us to?
7. Make fewer, larger shopping trips. The less time you spend visiting grocery stores, the more you?ll save. Constantly running to the store to ?pick up a few items? is a sure fire path to spending more than you need to. Have a running list in a conspicuous location in your home, and add needed items to it. Hold your shopping excursions until the list is sufficient to justify a full blown shopping trip.
8. Emphasize store/generic brands and avoid name brand products. Name brands are often a default choice because of the advertising their manufacturers blast at us all day every day. But just remember that we?re paying for that advertising every time we buy name brands, which is a big part of why they cost more. Stop paying for advertising!
9. Pay with cash or bank debit cards. Forget about credit card rewards points when you buy groceries; what ever you make on them you?ll more than give back because credit cards encourage buying more than you can afford. Cash and bank debit cards impose a natural limit on spending, because we?re using ?our money?, not other people?s money.
10. Shop alone. Resistance weakens in groups, so leave the kids, spouse or significant other at home. Let?s admit it, each of us has a soft spot for a couple of extravagances, but multiply that desire times the number of people in tow, and any semblance of a budget disappears. Don?t shop with kids especially?generally they want everything they see and no one can say no all the time.
11. The biggest ?tightwad? in the house should do the shopping. Not all shoppers are created equal! The person who should do the shopping is the one best qualified to do so. Some people are just better at handling money, especially doing it on the fly.
12. Clip coupons. Many people don?t do this because it requires some time but try this: save store and product circulars in a file folder, and once a month review them to find any that you might use, cut them out, and place them in a boldly marked envelope so all you need to do when you go shopping is grab the envelope and go. Store coupons may be good for only one week and may need to be reviewed just before shopping. We?ve saved more than 10% with coupons on more than a few shopping trips so it?s well worth the extra time.
13. Make and use a list. A grocery store is a literal cornucopia and if you don?t have a plan walking in the door you?ll almost certainly spend more than you need to. Have a list of what you need to buy prepared in advance and leave space to one side so you can record prices. You should have at least a ball park idea of how much you are spending while you are shopping. Bring a small hand held calculator if you?re bad at math.
14. Shop in food warehouse stores, but don?t abandon your regular grocery store. As much as I prefer buying at Sam?s Club, the reality is that they don?t always have better pricing than our local grocery store. My wife and I have found that on close to half of all grocery items, regular grocery stores are cheaper. Warehouse stores tend to be better priced on bulk items like bread, rice, potatoes, and non-food items, but can be higher on other goods. Be careful as well with the larger quantities; if they sell onions in five pound minimums, and you don?t use that many, the money you saved will go in the trash with the spoiled onions. Better yet, if ALDI opens a store in your area, investigate it and become a regular there, prices are even lower than they are at the warehouses.
15. Set a grocery budget and stay within it. You can adjust any of the components of the budget based on need, preference or higher or lower than expected prices, but stay within the overall assigned budget. Grocery shopping is comprised of a large number of variables so you need to have a game plan going in or you?ll lose control. Within reason, your food consumption should be adjusted to your budget and not so much the other way around. If your shopping and spending practices are driven mainly by your perceived needs alone, you effectively have no budget, and that will cost more.
What are you doing to keep grocery shopping costs under control? Is there anything you can add to this list?
I would recommend more aggressive use of coupons. Get multiple copies of the Sunday coupons from friends, family and neighbors who aren’t coupon users. Or trade coupons. For example, I don’t need all the diaper and infant formula coupons but my sister-in-law isn’t interested in the cereal coupons, so we trade.
If you take your newspaper to a recycling facility that is another excellent place to get multiple copies of the coupons.
Then check the grocery ads to see what is on sale, and match them up with the coupons you have. When you can match up a great sale with a coupon??and you have several copies of the coupon??then you can stock up at the best possible price.
Of course you have to be careful not to buy more than you can use before the item expires. And it’s never a good deal if you buy a ton of something your family doesn’t like.
Outstanding advice Christine–thanks for adding to the content of the post.
My wife actually handles the coupons in our house, but I can attest that there’s REAL money to be saved through aggressive use of coupons. We probably save a few hundred a year just on that!
It might be cliche, but you are right: I know I even surprise myself at the non-essential junk I buy just because I’ve got hunger pangs and I’m in a store full of goodies. And I know better too!
Be careful when considering buying items on the “end-caps.” Yes, sometimes those end-caps – the displays on the ends of each aisle – feature decent deals. But many other times, they also are set up to look like they are selling items at a special low price, when in reality just the opposite is true. Trust me, I used to work in a grocery store and they often put products that were not bargains on those end caps. But they moved quick because they were jazzed up to look like it was a special deal – either with super large festive signs or balloons. They made a lot of money for the store!
All the best,
Len Penzo dot Com
That’s a good point Len, the end caps–like the check out stands–are set up to play into impulse buying.
There are so many subtleties to shopping that unless we’re aware of them, we’ll pay more every time. It’s set up to be that way.
🙂 We spend about $200 a month (2 people) using most of these techniques (except coupons and warehouse stores – we don’t do those). The biggest savings come from using store brands, avoiding processed foods, planning ahead, and cooking more meatless or low-meat dishes.
Meat is a huge item, the more of it you can do without, the lower your bill. Substitutes are almost universally less expensive.
Speaking of meat, how are you coming with that cow your raising Paul???
You mentioned junk food when you’re hungry, but junk food any time adds a lot to the grocery bill! Chips, sodas, candy, ice cream – all that stuff is expensive AND not good for you. Improve your health and your wealth by cutting that junk out!!
Haha, the cow is growing well. As you know, that’s a bit of a different experiment than actually raising him for the beef. We’ll keep most of it but we’ll still use it sparingly. However, it will be interesting to see how the cost compares to buying at the grocery store.
Jason – you’re right, junk food is expensive anytime, but I emphasized it in connection with shopping on an empty stomach because that’s the exact “food” we’re likely to go to when we’re hungry. I’ve seen people munching on an open bag of chips or cookies while shopping.
Paul – I mentioned it because since the topic is grocery shopping, I wanted to call attention to your experiment – in case anyone wants an alternative to shopping! 🙂
To go even further on #4, we shop at a 24 hour grocery stores, and go in around midnight. Not only is it quiet, there are no lines and most of the isles are crowded with stock piles so if it’s not completely necessary, we just avoid the inconvenience of maneuvering the cart down the tight isle and move on to the necessities.
Jesse, I can see shopping at midnight as a benefit. The peace and quiet can provide the ability to concentrate so that you have a truly clear head and are able to seek out the best deals without distraction.
I can’t get myself out to a food store at that hour, but I’ve known people over the years who do it, and they swear by it.
Biggest tightwad do the shopping! So true! Anyway on the coupon swapping … most of the libraries in my county have set up coupon swap boxes. Donate, take, swap coupons to your heart’s content whenever you go to the library.
That?s worth looking into! Thanks for the additional tip!
These are all great tips. I would add that one can easily save more than 10% using coupons. The key is to use them in combination with sales, so plan meals and shopping trips around the weekly sales.
Hi Amy – I agree, the extreme couponers do it all the time. I was keeping the advice on that light because not everyone is wired to take coupons as far as they can go. We’re all too rooted in convenience and ease of use these days, and it’s costing us real money!
For a disciplined shopper it shouldn’t make any difference how you pay for your groceries. I love getting my 3% cash back at the grocery, which saves me around $15-$20 a month. I pay my card off totally every month and let the money roll in.
With a solid weekly menu based on items you have and that are on sale that week(which leads to a defined shopping list), digital and paper coupons, and using money savings programs like NBPR rebates, Ibotta, Shopmium, Checkout51, and Receipt Hog, savings at the grocery can be huge. It takes a little of your time, but even a mid-20s guy can do it!
Hi William – I disagree on the 3% cash back claim. If you’re saving as much as $20 a month with your 3% rebate, that means you’re spending about $600 per month on food. As “mid 20s guy”, and especially if you’re single, $600/month is way too much to spend on groceries, and supports my assertion that you spend more using a credit card than you will with cash or a debit card.
My family of four spends about $800 per month for groceries, and my youngest is 18! Can you clarify your rebate claim? Are you feeding a family? Are you sure that paying with a credit card is really saving you money???
Hey Kevin, looking back at my statements my grocery cash back is around $12-$15/month as my wife and I spend around $400 to $500 a month on groceries. Additionally, we eat out very little and take our lunches to work, so this is the majority of our monthly food budget. Sorry for the confusion.
As far as paying with a credit card, I don’t believe it leads me to spend more than I would with debit or cash. I actually think it causes me more anxiety because I owe someone money and I work to make my monthly statements as small as possible. As long as someone is responsible and smart with credit cards, I think it’s a great way to generate extra cash. We?ve already received $500 cash back ($100 came from a signing bonus) in one year that we?re going to use on a future vacation. Not everyone needs to be scared of credit cards like ole? Dave would have you believe. Additionally, I don?t believe a lot of people have a different emotion when it comes to using a debit card vs. a credit card. I?ve seen plenty of people put too much on both forms of plastic just because they?re not good money managers.
As far as the rebates, they?re called NBPR rebates or No Beer Purchase Required rebates. Basically, they?re promotional rebates put out by mainly beer and alcohol companies. With the rebate form you submit some normal information along with your grocery receipt that meets the rebate?s requirements. Most of these rebates require you to purchase some quantity of the company?s product (example: two six packs of beer), but for a lucky few of us our state prohibits this and an alcohol purchase is not required. My favorite rebate was one put out by Heineken, which gave me a $20 rebate on $80 worth of groceries and because I live in KY I didn?t have to purchase the beer. I have always had to buy the rebate forms off EBay (because I don?t believe they circulate them in NBPR states) for around $2 a form, so I usually net $18 per receipt. I?ve only seen a couple of personal finance blogs cover these, but then again you have to really be in the right state to make them work for you. Just search ?NBPR? on EBay to find the forms and see if you are in one of the right states or if you are someone who purchases beer at the grocery.