How to Budget for Groceries

Have you noticed that grocery prices have gone up? You may be paying more to stock your pantry and fridge than before. And it’s definitely not just in your head. 

In August 2025, the cost of groceries was 2.7% higher than it was a year earlier, according to the Consumer Price Index. And in an Axios poll published in August 2025, 53% of Americans said the cost of groceries was stressing them out big time. You might easily feel the same if your food costs keep rising but your paycheck hasn’t gone up. 

Food makes up a big part of most household budgets. And since you have to eat, you may feel like there’s only so much cutting back on groceries you can do. 

When finances are tight, many households resort to putting groceries and other essential purchases on their credit cards. In 2023, for example, roughly 60% of U.S. families used credit cards to buy groceries, per the Urban Institute, but only about one-third of people who did so were able to pay their balances in full.

If you’ve gotten into a similar pattern, it might push you to the point where your credit card bills are piling up and you need debt relief. That’s why it’s so important to do what you can to save money on groceries. Let’s review how to budget for them and potentially spend less. 

Set a Baseline: How Much Should You Budget for Groceries?

The USDA sets guidelines for grocery budgets based on its research and the cost of supplying a household with adequate nutrition. Let's assume your household has two children ages 6 to 8, as well as an adult man and woman between ages of 30 and 50. Here's what the USDA says your monthly food costs might amount to, depending on the budget you choose:

• Low-cost: $1,062

• Moderate cost: $1,285

• Liberal: $1,557

But just because this is what the USDA thinks it costs to feed a family doesn’t mean that’s what people can afford to spend—or what they actually spend. In 2023, for example, the typical U.S. household spent $6,053 on groceries, or just over $500 per month, according to the Bureau of Labor Statistics.

The amount of money you spend on groceries will depend on the number of people in your household, as well as their dietary needs. If you have athletic teenage children who are growing, you may need to spend more on food than someone whose children are 6 or 7 years old. 

It’s important to have a realistic idea of what it costs to feed your family based on their specific needs and requirements. That way, you’ll know how much money to allocate to grocery spending in your budget, as opposed to other expenses. 

If you have a strong handle on what your groceries cost, it could make it easier to budget on a whole. That could help you keep your credit card bills more manageable and avoid or limit debt. 

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The 50/30/20 Rule and Grocery Budgeting

The 50/30/20 rule is a common budgeting method people use, and it's easy to follow. First, figure out how much money you take home in your paycheck each month after taxes. Then, categorize your expenses like this:

• 50% toward essential needs

• 30% toward wants

• 20% toward savings and debt payments

Here's an example. Let's say you bring home $5,000 a month. In that case, you'd spend:

• $2,500 on essential needs

• $1,500 on wants

• $1,000 on savings and debt payments

Groceries should fall into the 50% essential needs category. However, food outside the home (like takeout or restaurant meals) should fall into the 30% wants category, since it's a lot more expensive to buy restaurant food.

If you're having trouble covering all of your essential needs on 50% of your paycheck, you may have to dip into the 30% wants category. That may be the case right now, since grocery prices are up. Plus, if you have a larger family or dietary restrictions that drive your food costs up, you may be spending more than 50% of your pay on essentials due to higher grocery bills.

Let's say that between your groceries and other essential bills, you're spending 70% of your pay, or $3,500, on essential needs. Adjusting your wants spending to $500 could make up the difference and help you avoid debt. 

What Drives Your Grocery Spending?

There are certain factors that may cause your grocery bills to go up or down. First, there's your household size. Having a baby or adopting a child could lead to higher food costs.

Where you live could also have an impact on your grocery costs. If you live in an area where there aren't many supermarket choices, you may end up spending more on food due to being limited.

The diet your household follows could also drive your food costs up. If you follow a plant-based diet, you may have to spend more on vegan food products. If you have members of your household who need to avoid gluten, you may find that gluten-free alternatives cost a lot more than standard supermarket items like bread and cereal.

Your grocery shopping habits could also be a big driver of your food costs. If you tend to be loyal to certain brands, you may end up spending more on food than someone who's willing to buy whatever brand is on sale that week. Similarly, if you tend to give into impulse purchases at the supermarket, it could lead to higher grocery credit card bills.

On the other hand, if you're someone who does a lot of meal-planning, it could help you keep your food costs to a minimum and avoid waste. Buying in bulk strategically is another habit that could save your family money, provided you're only loading up on large quantities of products you eat on a regular basis.

You may also find that going to the store a few times a week saves you money compared to only shopping weekly. If you insist on doing a single grocery run each week, you may end up buying extra items just in case so you don't have to make a return trip. If you're willing to hit the store on your way home from work an extra time, you may be more inclined to stick to a shorter list each time you go.

On the other hand, if you stick to a once-a-week shopping run, it might force you to shop more efficiently and help you avoid impulse buys. Think about what's best for your schedule and budget when deciding how often to shop for food.

Move Money Around From Other Parts of Your Budget

Even though food prices are up, there may be other expenses from your budget you can reduce. To get an idea of where you can find extra money in your budget for food, compare two bank or credit card statements. Then, on a piece of paper, create two columns for expenses you can control and expenses you can’t. Here’s an example.

Play around with expenses you can control to pad your grocery budget. For example, canceling a $20 monthly subscription and skipping one restaurant meal per month that typically costs $30 leaves you with $50 more to spend at the supermarket. 

Now it may be that after moving money around and reducing flexible expenses, you still don't have enough money in your paycheck to cover your grocery needs. In that case, you'll need to think about how much you're willing to sacrifice to buy groceries without having to carry credit card balances and add to your debt.

It's not easy to tell yourself you won't attend social events or watch cable because food costs are up and you're falling behind. Giving those things up temporarily, though, might help you cover your grocery bills without increasing your debt. From there, you can think about ways to boost your income, whether it's getting a new job or a side hustle, so you don't have to cut back on the things you love.

You may also decide to temporarily stop contributing, or reduce contributions, to your emergency or retirement savings to cope with higher food costs. This is okay to do for a few months. But try to make a long-term plan so you don't derail your financial goals.

You might tell yourself you're going to cut savings contributions through the end of the year because you're expecting a nice raise in January. That's a perfectly reasonable thing to do if you expect your situation to improve soon enough. If not, you may need to come up with a different long-term solution, like reducing a fixed expense in your budget like rent so there's more money to cover your various needs on an ongoing basis.

Smart Shopping Strategies to Stretch Your Budget

A big part of grocery budgeting is knowing how to lower your grocery costs. Here are some tips you can look at. 

Shop for fruits and vegetables strategically

Eating healthy is important even when money is tight, so it’s important to prioritize fruits and vegetables in your grocery budget. The good news is that there are ways to load up on them more affordably.

First, check whether local farms in your area offer better prices than your supermarket. You can also look at getting a share at a CSA farm, or even growing some of your own food if you have the time and space.

Also, don’t discount the benefits of canned or frozen vegetables. You can stock up when your local grocery store has them on sale.

Choose less-expensive versions of the items you love

Updating your grocery budget doesn’t have to mean giving up the foods you love most. It could just mean making some adjustments. 

If your family enjoys red meat, you should know that ground beef typically costs less per pound than chuck roast. So with some small changes to your cooking, you can enjoy your favorite foods and big savings. Similarly, chicken legs cost less than chicken breast, so if you're not picky about the cut, get the cheaper version. 

Plan your meals ahead of time

A good way to stretch your grocery budget is to figure out what you’re cooking at the start of each week. You can do this based on two factors—what’s on sale at the supermarket and what you already have in your fridge or pantry that you want to use up.

You may want to focus on meals that can be easily modified for variety. For example, say you’re cooking chicken and rice, with enough for a few days of leftovers. You can serve the chicken and rice on its own one day, wrap it up in a burrito with sauce the next day, and make chicken salad the third day. 

Buy in bulk when it makes sense

Buying groceries in bulk is a good way to make the most of your grocery budget. You often pay less per ounce or unit when you buy in bulk. And you don’t need a warehouse club membership to use this strategy. Many grocery and big-box stores offer fresh and shelf-stable items in bulk.

There are a couple of ground rules to follow if you’re trying to save money by buying in bulk. First, only load up on items your family eats on a regular basis. Secondly, be very careful with perishable items, and make sure they’re part of your weekly meal plan before buying them. 

If you’re making a broccoli souffle and a broccoli salad in the same week, that makes the case for buying broccoli in bulk. Otherwise, you may want to skip buying it in bulk to avoid wasted money and food.

Load up on store brands

Store brands are often less expensive than national brands, the same way generic medication tends to be cheaper than brand-name pills. Compare prices at your local grocery stores to see how much you can save by choosing the store brand.

That said, it’s also important to see what’s on sale every week, because sometimes, a national brand is discounted enough to make it less expensive than the store brand. Most supermarkets make their weekly circulars available online, so don’t worry if yours gets lost in the mail or misplaced. 

Be creative and flexible

If the items you typically buy don’t seem to be going on sale and they’re too expensive for your grocery budget, it may be time to pivot. That could mean taking a break from beef or egg products temporarily, and replacing them with lower-cost protein sources. 

If you have children who are used to certain foods that don’t fit into your grocery budget right now, get them involved in meal-planning. Work together to find creative alternatives, and experiment with new recipes together. 

Track your personal inventory

Knowing what items you already have in your pantry and fridge is a good way to save on groceries. Come up with an inventory system that works for you. It could be a spreadsheet or a list you keep on your phone. Update it regularly when you buy food or run out of items you use regularly.

Take advantage of store loyalty programs and coupons

Many stores give you a discount for signing up for a free loyalty card and scanning it when you check out. These cards aren't credit cards, so there's no hard inquiry on your credit report or credit score impact for signing up.

It's also a good idea to check your supermarket's website each week for digital coupons. Loading those to your store card could result in big savings.

Look at online deals

Sometimes, you can save money on groceries by buying them online. If you don't have a big-box store like Walmart nearby, for example, you may want to order non-perishables online and have them shipped to your door. You may find that the cost is less than buying those items at a grocery store nearby. 

It's always a good idea to compare prices. Buying online won’t always be cheaper, but you won’t know until you look.

When Grocery Budget Consistently Falls Short

You may find that no matter how carefully you plan, you inevitably wind up spending more on groceries each month than what you've budgeted for. If that's the case, it's important to rethink your grocery budget and allocate more money in your overall budget for food.

If you're consistently charging groceries on a credit card you can't pay off in full, and your total debt level keeps rising, it may be a sign that you're not budgeting enough for groceries. Or, it may be that you truly can't afford to feed your family and need help. There's no shame in that, and it's important to use any resources that may be available to you.

To that end, it could pay to:

• Find out if you qualify for SNAP benefits.

• Apply for free or reduced school meals for your children.

• Turn to local food banks to help stock your pantry and fridge.

• Talk to a community or clergy leader about your struggles and see what local resources are available.

If you keep adding to your credit card debt despite strict budgeting, and your debt is becoming overwhelming, it could pay to seek help from a debt relief company. 

Try to Boost Your Income

Getting a side job could open up a lot of room in your grocery budget. In fact, working a few extra hours a week could be positive for your personal finances as a whole. Not only might you find it easier to cover your grocery costs, but the extra money could make it possible to pay off debt you already have.