How to Create a Food Budget

How to Create a Food Budget

So you’re ready to take control of your food spending but not sure where to start? Begin with figuring out your baseline. How much have you spent on food over the past month, six months, and one year? Knowing how much you normally spend on food will allow you to create a realistic budget moving forward. 

 Here are a few ways to figure out how much you spent on food over the past few months: 

food budget, magnifying glass
  1. Use a budget app such as Mint, EveryDollar, You Need a Budget (YNAB), or Cleo. I personally use Mint because I have been using it for years. However, you can use whichever one you feel most comfortable with.  These apps categorize your spending based on your purchase description. I recommend double checking your transaction to ensure they have been categorized correctly. Sometimes, it is categorized incorrectly or marked as “uncategorized” which may skew your numbers. Also, note that they may categorize food purchases as groceries, take out or generally as food and dining. Make sure you are reviewing all possible food spending categories. The goal is to have the most accurate picture of your spending on food as possible. One of the benefits of using these apps is being able to use the “trends” feature to compare your spending over the past 1 month, 6 months, 12 months, even multiple years to see how your spending habits have changed over time. 
  2. Not comfortable with hooking up your finances to a third party app? The second way to track your spending is to manually calculate your food spending using your bank statements. This will only work if you use mostly credit cards or debit cards to purchase food. The fastest way to do this is to go to your bank site, and use the search button under account activity and search your purchases from within the past year. Depending on the bank, you may be able to search purchases based on categories such as groceries or food and drink. If you have to search by vendor, start with the stores you typically grocery shop or get take out from. You may have to go through your entire statements to double check you have gotten all of the purchases. You will need to do this with each credit card or debit card you use to purchase food. This can be tedious, but I promise it will be worth it! 
  3. If you are someone who mostly uses cash, it is going to be more difficult to track your past spending, unless you already keep track of your monthly spending or use an envelope system. What I recommend is to start by tracking your spending for at least one month to get a better idea of what your monthly food spending currently looks like.

Once you have selected your preferred way of tracking. Make a spreadsheet with the following categories: 


  • Date/Month/Year
  • Food Categories (Groceries, Take Out, Restaurants/Dining-In, Fast Food)
  • Cost
  • Payment Method (Credit Card, Debit Card, Cash) – Optional
DateFood CategoryCostPayment Method
1/1/22Groceries $100Credit Card

Use the spreadsheet to track your spending categories for the past month, 6 months and 1 year. I like to use these markers to see overall trends in my spending habits. After gathering this number. Use your one year average as a starting point for creating a monthly budget. To start, I recommend creating a monthly budget that reduces your spending by 10-20%. This is a number you can reduce further as the months go on, but reducing your budget dramatically in the beginning, may not be sustainable for you and your family. My goal is to help you build sustainable solutions to reduce your budget, not a one month fix. If after a month or two of a successful 10-20% reduction in food spending costs, if you want to try a 30% reduction you can do so. 

When I first started My Food Budget Journey, I was spending an average of $1,400 a month on food a month for my family of 3. Using this number, I was able to create a realistic budget goal of $1,000 a month (a 30% reduction), but for the first two months I started with $1,200 (a 15% reduction).

So how do you know which food categories to reduce your budget in? This is a personal decision. When looking at your numbers and knowing you and your family, which categories do you realistically think you can reduce? 

Here are some questions to ask yourself to help you think through this: 

  • Do you plan out your meals for the week before doing your grocery shopping? 
  • Do you take an inventory of what ingredients you already have before grocery shopping? 
  • Do you have a number you try to stick to each week for grocery spending? 

If the answer to these questions is no, you may be able to reduce your grocery spending budget.  

  • Do you plan ahead for the days you’re going to take out or go to a restaurant? 
  • Do you have a budget or sinking fund for special occasions such as birthdays or anniversaries? 

If the answer to these questions is no, you may be able to reduce your take out, restaurant or fast food spending budget. 

You can choose to reduce just one category or all three, but remember to be realistic! It is not realistic to cut your budget by 50% in the first month. Start with a 10-20% reduction per category and work from there! 

Now that you have a budget, it’s time to put it to work!

Check out Meal Planning 101 and 10 Tips to Save Money on Groceries to help you stick to your food budget.

Follow @myfoodbudgetjourney on instagram for tips on how to save money on your food costs and stick to your new food budget!