by Ben Sweiry ·
Modified on 3 May, 2022
The average American household spent $412 per month on groceries in 2020, totalling almost $5,000 a year spent in the supermarket alone. This leaves huge leeway to save money through using the right saving and planning techniques. Figuring out how to save money on groceries can save you thousands each year. By perfecting your grocery budget, you can make some serious contributions to your savings goals.
Plus, the best part is that saving on groceries doesn’t have to mean skimping on delicious meals or depriving yourself of quality produce.
In this guide, we’ll cover some simple but effective tips for saving money on groceries.
Key Points:
- The average US household spent $412 on groceries each month in 2020.
- The average cost of a home-cooked meal is $4.12. Buying simple ingredients can keep your cost similar or lower than this, while complex ingredients will up this cost.
- Comparing supermarkets’ prices online before shopping can show you where you would make the most savings. Make sure to check the prices of the products you repeatedly buy to be most effective in comparing prices.
- Bringing cash along to pay for your groceries can deter you from making unnecessary impulse purchases.
- Look into cashback schemes offered by the stores you shop at. Some will offer cashback or credit vouchers if you’ve found cheaper prices elsewhere.
- Some credit cards, such as the Blue Cash Preferred Card from American Express offers up to 6% cashback on grocery shopping on up to $6,000, and 1% cashback thereafter.
- Loyalty schemes can help you collect points to spend in store, with no added cost to shopping.
How Do I Make A Budget For Grocery Shopping?
Plan Simpler Dishes
When it comes to grocery shopping on a budget, simplicity is key. With the average cost of a home-cooked meal being $4.12, it is easy to cook well at home for a healthy price.
Choosing to make a complex recipe can easily absorb an entire week’s budget simply because of the number of ingredients it requires.
If you want to start saving money on groceries, pick a few simple, yet tasty, recipes that you love and that only require a maximum of five ingredients.
Better yet, when choosing the meals you want to make for the coming week, opt for recipes that share some of the same ingredients. This will save you money in the long-run, as buying in bulk usually works out cheaper—but only if you use all of the food that you buy!
Meal Plan In Advance
If you’re serious about grocery shopping on a budget, planning your meals in advance is essential. Before you go shopping, make sure you know exactly what you’re going to eat that week so that you can calculate your projected costs before you start spending.
This reduces the chances of you going over budget and encourages you to get creative with the types of meals you will create that week.
How Can I Save Money During My Grocery Shop?
Look At The Lower Shelves
To encourage you to overspend on your grocery budget, some supermarkets put their most expensive products at eye-level. These are commonly used psychological tricks used to reel you into spending more money.
If you look at the same types of food that are being sold a shelf or two below eye-level, you’ll notice that the prices tend to decrease.
The cheapest products are often closest to the ground, so start there first.
Ditch The Shopping Cart For A Small Basket
Another method supermarkets use to get you to stop saving money on your groceries is to provide you with oversized shopping carts and baskets. This makes it seem as though you have fewer groceries than you do simply because they don’t seem to fill the space they’re in.
The best way to get around this is to choose the smallest grocery-carrying option available to you, which is often a basket. Failing that, if you’re only going to be purchasing a few small items, skip the basket altogether and carry them yourself.
Comparison Shop For Better Prices
It’s no secret that supermarkets and independent grocery stores price their products differently. Often, the price for the same product will vary wildly from store to store.
So, to make sure you reach your monthly grocery budgeting targets, you’ll need to do a little bit of on-the-ground (or even online) market research. For more information, read our guide on top 10 ways to budget.
Don’t Shop When You’re Hungry!
We’ve all been there: stomach growling as we prowl the aisles, hungrily throwing an unnecessary amount of food into our baskets as our need to eat consumes everything in our path. Yes, if there’s a sure-fire way to ensure that you overspend on your grocery budget, it’s shopping on an empty stomach.
The solution? Eat before you shop! It sounds simple, but it can make a huge difference. Even eating something as small as a banana or a breakfast bar before you start grocery shopping could save you from putting an extra €15 of food in your basket.
Pay For Your Groceries In Cash
A great tool to save money on groceries is to take your monthly income out of the bank in cash and allocate that cash into separate envelopes in accordance with your budgeting goals.
This means having envelopes for your fixed costs, and envelopes for your variable costs such as for entertainment, clothes shopping, eating out and groceries. There are also budgeting apps you can use to keep an eye on your grocery spend and get access to savings too.
By paying for your groceries with a fixed amount of physical cash, it makes it virtually impossible to overspend.
What About Loyalty Schemes?
One fantastic way to save your hard-earned dollars when doing your grocery shop is by getting a loyalty card or signing up to a loyalty scheme.
Many stores offer this service which is intended to make you a repeat customer. It’s likely that you already are a repeat customer, as we tend to shop based on convenience. So, you should check whether your favourite stores offer rewards, either in the form of better deals for members, or offering a points-based system whereby you can redeem rewards based on previous purchases.
And Cashback?
Many stores offer money-back guarantees if you let them know that a competitor store is offering the same product for a lower price.
While this may seem like a futile task, the dimes mount to dollars which can mount to hundreds. As such, pursuing the cashback process is a habit worth picking up!
Additionally, you could apply for a credit card which offers cashback at supermarkets, making you low-effort but high-reward savings throughout the year. For instance, the Blue Cash Preferred Card from American Express offers up to 6% cashback on up to $6,000 per year, and then 1% cashback after that.