It’s a common experience - a trip to the grocery store that results in a receipt with four times as many items as planned. You tried by not getting a cart at first, but you ended up grabbing one anyways to accommodate for an armful of impulse buys. These “not on the list” items add up quickly, and can totally blow your monthly budget if you aren’t careful.It doesn’t matter if your weaknesses are sale items, baked goods, candy, or even exotic produce, you aren’t alone. Both men and women report grocery items, uneaten food, and eating out as top money wasters and areas they are willing to reduce. You can reduce wasteful spending by creating a budget and sticking with it. We asked our partner InvestEd, a Baltimore-based Registered Investment Advisor Firm for a few budgeting pointers. Lead Advisor, Genti Cici, CFP®, suggested starting with a monthly household budget divided into 3 main categories:
Essentials are the largest category, making up 65% of your gross income. These are things like taxes, mortgage/rent, loan payments, transportation, utilities, healthcare, insurance, and living expenses such as food/groceries.
Savings for Goals such as your retirement, house, kids’ education, and emergency fund should be at least 20% of your gross income. While this might seem like a lot, Genti stressed that saving now makes it possible to spend later. You should save at least 20% of your gross income to ensure you to have the financial means to reach your life goals.
- Discretionary spending such as eating out, hobbies, shopping, and memberships can make up 15% of your budget, but no more!
“InvestEd aims to match each client's’ values with their budget,” Genti added. “If a healthy lifestyle or healthy food is a top value for you, your advisor will help you adjust your budget, cutting somewhere else that is not as important.”
The InvestEd team also recommended using technology to track spending and help you stay on track of a realistic budget. A free resource they suggest is Mint.com. Genti says, “With a little dedication to directing and monitoring the software, this tool can really help you see where you are spending and ensure you are staying within your budget.” If you are just getting started, consider meeting with an advisor at InvestEd for free financial education and to review your goals, budget, and balance sheet. You can also attend one of their free financial seminars to get the hang of the basics.
Once you have your budget planned, start practicing purposeful shopping and stick to it. Before going to the store, make a list and only buy the things that you planned to purchase. Some people find that ordering meal delivery kits allows them plan for meal expenses without buying too much of any ingredient. By making fewer visits to the grocery store, it is easier to avoid the type of impulse purchases that can blow your weekly budget.
Terra’s Kitchen meals start at $9.99 per serving and take the guesswork out of weekly grocery budgeting. To start planning your meal budget with Terra’s Kitchen, take a look at our current menu.