Wednesday, April 6, 2011

Grocery expense bleg

In the comments below this post, I get taken to task by a reader who thinks it's unfair for me to hint that grocery stores overcharge their customers. To be honest, when I wrote that post, I was thinking more of a department store which shall remain nameless but whose receipts always declare, "You've saved $$$ today!" when in fact you've just spent money, and probably more than you were hoping to spend, on clothing items for your family or the like.

However, in the back-and-forth about grocery stores and prices, I found myself pondering the often-quoted statistic that says Americans spend less of their incomes than nearly anybody on groceries--somewhere around 10%, say most sources. But when you go to track that statistic down, you find debates about the usefulness of it, based on these and other grounds:
  • families of below-average income spend proportionately more on the basics, and are thus more impacted by rising costs;
  • the statistic seems to be costs of food per person, not per family;
  • Americans, especially those in two-income families, eat out frequently--are these costs counted as "grocery expenses" or not?
and so on.

Just for fun, I considered our family's grocery costs as percent of income. I used net income rather than gross for the purpose of this exercise--because as an interested party in family budgeting I can tell you that the "gross" figure is not very useful, and if we made our spending decisions based on money we never actually see we'd just be broke all the time. But I'm open to discussion about whether it would be better to recalculate these figures based on gross pay instead of net.

We are a one-income family of five. Estimating our net income and our ordinary grocery expenditures, and subtracting a certain amount for non-food items (though frankly since these are also regular expenses I'm not sure we should subtract them!), I end up with a grocery expense percent of between 20 and 24 percent of net income. And we're not buying extremely expensive foods; we eat no beef at all and try to keep processed foods to a minimum.

Now, this isn't a scientific example; I'd have to go through weeks worth of grocery receipts line-by-line to remove things like laundry soap and then recalculate using an exact net income instead of an estimate--but I think the 20% mark seems about right, when I look at our spending generally, and I'd be really surprised if it were a whole ten percentage points lower than that.

So here's my bleg: how about you? What percent of net income does your family spend on groceries? I'm particularly interested in these details:
  • Are you a one or two income family?
  • How often do you eat out in restaurants?
  • Is either parent a stay-at-home parent?
  • What is your best estimate of the percent of net income you spend on food items?
If your budget for groceries includes non-food items, don't worry if you can't guess exactly how much is spent on food alone; I still wonder if "grocery" shouldn't mean "things we regularly buy at the grocery store," even if those things include soap and paper goods.

Again, this isn't an attempt to get a scientific result--I just have a feeling that there are plenty of exceptions to the "average Americans only spend 10% on groceries!" statistic, and would like to hear from you to see if that's true for your family.

Thanks in advance!

21 comments:

Kindred Spirit said...

Ours is a one-income family of four. We buy organic and spend a bit more than most, about 25% of our income, on food. We don't eat out, we cook from scratch, we buy on sale, and we eat beef (organic) no more than once a week. We have our own garden, which helps in the Summer into Fall.

Bathilda said...

I am too lazy to do the actual math (as a percentage), because my food expenitures vary so much from week to week, Plus, I would say that the 10% number is a statistic that has all kinds of stuff figured into it. I would think that most people spend more than that on average. However, I think that for the purposes of this informal polling, it should be for food only, and all food expenses, even if you eat in restaurants. (maybe leave out special occassion eating out) I spend about $60 per week at Trader Joes, where I buy organic milk, meat, and frozen veggies (all organic). I spend about $50-65 per week at a "regular" grocery store, and a minimal amount on food at Costco, maybe $10 per week if I average it out. We spend probably $50-60 per week on restaurant food. We usually eat out at a mid priced restaurant after Mass on Saturdays. (not a lot of fast food during the week) I buy primarily organic food, if it's available.
You are right about low income families spending more on basics. I think that this is because many impoverished people don't live close to a decent grocery store. Urban families shop in what amounts to a "convenience" store, and those jack up the prices. I live in a major midwestern city. not the suburbs, but not downtown either. Right in my neighborhood, the grocery prices are pretty good. If I shop a mile or two south (closer to downtown), the prices go up substantially. The choices, especially meat and produce, go DOWN substantially. This is at the same Grocery store chain! As for grocery stores gouging, they probably do, but they are businesses, and they exist to make money. Feeding people is not really the main goal.

We are a one income family of four. I stay home.

Erin said...

1. One-income family; three people (but one is currently exclusively breastfed!)

2. Eat out at restaurants 1-2 times per week (including fast-food, and by "restaurant" I mean IHOP or someplace comparable)

3. I am a stay-at-home mom

4. Grcoeries account for 10% of my income--but that is because I STRICTLY limit the amount I spend--I mean, I just DON'T go over my budget. I put non-essentials at the end of my order, and if the bill gets too high, I tell the cashier not to ring them up.

I buy NOTHING organic, and whenever possible, will buy the generic.

JMB said...

We are a one income family of 6 - 4 of which are adults, teens older than 14.

I spend roughly $300 per week on groceries. We eat out every Sunday night( I'm not including that in my weekly food budget). We also get pizza delivered every Friday night (not included too). I pack my childrens' lunches for school, even the high schoolers.
I don't buy a lot of processed food (basically just cereal). I pretty much cook everything from scratch, besides using rice and pasta.

I can't do the math but I'm a little stunned now after watching "Extreme Couponing" on TLC last night. WHOA. I'm not sure what to make of that! But I do get 3 newspapers delivered each week so I don't have any excuse for never couponing.

CT said...

Last month was the first month were we actually kept track of how much we spent on groceries. I think it ended up being about 15%, counting non-edibles like TP and aluminum foil. We probably eat out 3-4 times a month, usually the whole family, but sometimes just my husband and I. When I lived in a city I think we spend less on groceries because they cost less. The cheapest grocery store here is a Safeway/Tom Thumb, which was the most expensive store when I lived in the city. The prices are mostly the same at both Safeways, so that tells you something about the cost of groceries here. We have a family of five, but the youngest (19mo) doesn't eat too much. I am a stay at home mom. Right now we could manage if grocery prices went up significantly, but it would be tight. However, since my husband's company is in danger of closing, we would be in huge trouble if that actually happened. We have only a couple months of expenses saved up and then we would be doomed.

Charlotte (Waltzing Matilda) said...

Are "groceries" being considered in the 10% statistic only edible food? I'd have to do a line by line examination of my receipts before computing because when I go "grocery shopping" I buy toilet paper, tin foil, shampoo, cleaning products, etc along with my bacon and eggs.

Kind of off topic, but what counts as processed food? Crackers? Cereal? Canned beans? Chips? Sandwich bread (not homemade)? Sure, mac and cheese would be a processed food, but what about just a box of pasta? I'm just curious.

Anonymous said...

FYI:
• The New York Times this morning reports that “each year, an ever larger portion of the world’s crops — cassava and corn, sugar and palm oil — is being diverted for biofuels as developed countries pass laws mandating greater use of nonfossil fuels and as emerging powerhouses like China seek new sources of energy to keep their cars and industries running ... But with food prices rising sharply in recent months, many experts are calling on countries to scale back their headlong rush into green fuel development, arguing that the combination of ambitious biofuel targets and mediocre harvests of some crucial crops is contributing to high prices, hunger and political instability.”

elizabeth

The Cottage Child said...

Ours evens out to about 20%, I think, if I deduct household and personal items, though those are going up as well, and I consider tp a necessity - where we live it's a hit or miss proposition with virtually no competition for the main grocery chain in town, and it's priced as such. Though it is the same chain, the store in the town we lived in prior was much higher quality and significantly cheaper (as much as 25% on some everyday items). Even WalMart hasn't got a good foothold here (though I wouldn't likely shop there, I wouldn't mind them being around for the competition). There is a small secondary chain with one store that we go to for some organic items, and the farmers market, but we live in a grocery ghetto compared to every other place in Texas I've lived, including considerably smaller markets. It's weird.

LarryD said...

Red - how is it you have time to shop for groceries when you're supposed to be writing a script this month?

:-)

Red Cardigan said...

Larry, you don't know the half of it.

I started two days ago. I wrote 23 of the 100 pages. I then spent today fighting a migraine, dashed off a blog post, and am done for the day.

I absolutely love this stuff. :)

Are you writing a script, too?

Christina Martin said...

Our family has about 8 people at home most of the time (it varies by time of the year) and we spend about 35% of our single income on groceries. We are EXTREMELY careful in our shopping.

LarryD said...

Red - no script this year. I have yet to dip my literary toes into that swamp.

texasmama said...

n10 people, 8 of them 13 andunder. If we exclude diapers and pullups (hate and love those things)ours is about 35-40% of our income. High, but we have food allergies to accomodate, which means some wheat free or peanut free processed foods like cereal and crackers. Plus, produce seems outrageously expensive to me right now.

Melanie B said...

We probably spend about 20% of our income on food. It's kind of hard to calculate as we have 3 adults (my sister lives with us)and 4 children. Two of the adults work (my sister and my husband) while I'm a stay at home mom with no income. My sister eats only some meals with us as a family and several times a week she picks up items as needed from the grocery store-- especially milk and fresh produce. But I do the majority of the grocery shopping and our grocery bills are about 20% of my husband's income. (That figure doesn't include diapers, most cleaning products and paper products, all of which I buy at Target.) Since we go out to eat maybe a couple of times a month, I doubt that would change the total percentage of income spent on food much.

I buy a minimum of processed foods but don't buy organic meats etc.

Kerri said...

Fun!

We are a family of 7 (SAHM) and we spend about 15% of net income on groceries. Our X factor is that I do not cook when my husband travels, which is 2-5 days per week. That definitely keeps costs down! We eat out (meaning pizza or Taco Casa) 1-2 times a month.

Milehimama @ Mama Says said...

We are a family of 11, but our income fluctuates. Generally our take home/net for a 40 hour week is $800 - which is my monthly grocery budget. This doesn't include eating out. So, 25% (not counting gas, misc. snacks, drinks on the road, and the like.)

And this is trying very, very hard, pinching every penny, making my own laundry soap, and so on.

Rebecca in CA said...

single income family of six...I haven't done the math but I am guessing it is around twenty percent for food alone. I do spend more on organic food, raw milk, high quality bread, plenty of produce, but on the other hand I mostly am cooking from scratch. We buy a pizza or go out to eat maybe once a week.

Martha said...

Stay at home mom, family of 6 (but one is a teeny, tiny 2 year old.) I spend 8% of our income on groceries. (that does not include diapers, which are cloth, and laundry detergent, which I break out in budgeting as a household expense, not grocery.) I live in one of the most competitive grocery markets in the country, and I take advantage of that. I do shop the loss-leaders. I buy no organics, and very little highly processed food (I do buy yogurt, cheese, bread, pasta, tortillas, jelly, and pickles, although it is possible to make those at home, and sometimes I do.) There's a book called Cut Your Grocery Bill in Half and I read it last year and follow it. I only buy produce in season; I make an entire month's menu at once, and stick to it. I only shop once a month, basically (although I do have to go mid-month for eggs & milk.) BUT I think way, way more about grocery shopping than most people do, so I can stay home with the little ones & send the older 2 to our wonderful parish school. And thank God, we have no food allergies. My dining out budget is $20/month, meaning basically, we don't do it every month.

Jackie said...

We are a one income family of six and I would say we easily spend 20 to 25 percent of our net income on groceries. I also use coupons where I can, shop discount grocery stores like Aldi for most items and try to save where we can. We very seldom if ever eat out. I think the statistics are wrong or don't take most middle and low income families into account.

Anonymous said...

I know grocery stores over charge consumers. We shop at Aldi's for some of our food~dairy, produce, bread, canned goods, and the price difference between Aldi and Wal.mart, or our local grocery chain, is astronomical. A pound of butter at Aldi, in our area, is $2.29. A pound of butter at Wal.mart is $3.79. I can get a bag of clementines for $2.59 at Aldi, and the same bag of clementines at the local grocery store for $5.00, on sale! Bananas are .69 a pound at the local grocery, and .44 at Aldi.
I'm a stay-at-home, homeschooling mom of three, two teenagers and one 10 year old. I baby-sit two sisters, a preschooler and toddler, to supplement our income. My baby-sitting money supplements our grocery budget. So, roughly $150.00 a week goes to groceries/eating out. We make our food from scratch, and are not product loyal.
Frankly, I can't afford organic, and couponing won't work since we make from scratch. The stores around here do not offer double, or triple, coupons. We also only have one local paper.
I've gotten very resourceful and choosy about where I shop and what I buy. The idea that Americans only spend 10% on groceries is ludicrous.

Jen in OK

Anonymous said...

http://s.coop/146f

A link to a one month experiment living on a food stamp budget and buying only organic, fair trade, sustainable foods.

She could have done better getting her spices and condiments in bulk at a co-op, or even at a Whole Foods. This is one person's experience. YMMV.