Drawing up a food budget

22 August 2022 by National Bank
monthly food budget

These days, having a food budget is essential. After housing, groceries rank second on our list of expenses. Here are some tips to help you draw up a budget and save on food.

Keep to the perimeter to reduce your food budget

Many experts recommend walking around the perimeter of the store, without going down the aisles.

By doing this, you can usually find most of the products you need while avoiding the temptation of processed foods, which are often more expensive. Generally, circling the outside of the aisles will also help you eat healthier (fruit, vegetables, meat, fish, milk, cheese). 

Make a grocery list aligned with your food budget

By making a detailed list of your purchases, you will avoid giving in to some of your impulses once you’re at the grocery store.

But it's a good idea to give yourself some room to buy products on special. Were you planning to buy asparagus, but see that green beans are on sale? Put them in your basket. This approach will also help you diversify your meals.

Buy in bulk to save on food

Buying non-perishable items in bulk can help you save big, as long as the lower prices don't actually make you spend more.

For example, buying trash bags on sale is unlikely to change your consumption habits, but five bags of chips for the price of three? That's another story... Also, don’t hesitate to freeze some of the bulk food items you buy. Bread, butter, herbs and many other groceries can last a long time once frozen and are quick to defrost.

Get a points card and check online to save

If you tend to shop at the same store, a points card can help you save big, especially if you pay using a credit card that also earns points. Just be sure to pay your credit card balance in full.

You'll save even more by checking flyers and using apps that give you access to coupons and cashbacks.

Other ways to save on your food budget

  • Try not to throw out food. According to the Food and Agriculture Organization of the United Nations, Canadians waste around 40% of their food. That's like losing $40 for every $100 you spend at the grocery store. Not to mention the environmental impact!
  • Making your own lunch and other meals for the week is a great way to save.

Example: If over 20 years (at 48 weeks a year), you spend $7/day on a homemade lunch instead of paying $15/day at a restaurant or cafeteria, you'll save $8/day.

If, for instance, you invest that money in a Tax-Free Savings Account (TFSA) with a conservative annual compounded return of 3%, you would save $13,500 (net of taxes).

  • Small purchases like your morning coffee on the way to work add up—and have a big impact on your annual food budget. By saving this money, you could easily afford that fancy espresso machine you've been dreaming about!
  • Keep a monthly tally of your food purchases. This will help you quickly spot opportunities to save.
  • Opt for store-brand products. For essentially the same quality, taste and quantity as name-brand items, you could save around 10% off the purchase price.
  • Think like a student. Many students are able to use creative strategies so they can have fun cooking while limiting their expenses.
  • Go back to basics. You can make all sorts of cheap, healthy meals out of rice, couscous, chickpeas, manioc, tofu and eggs. It's even better if you can get local, seasonal products.

By drawing up a food budget and making a detailed grocery list, you can help yourself resist temptation at the supermarket. Being disciplined could help you save big so you can realize your projects. Feel free to make an appointment with our specialists for support and personalized saving advice. We're here to answer your questions.

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