Products and features may vary by region.
The right grocery budget can save you thousands each year—without skimping on healthy eating. Here’s how to shop smarter at the grocery store.
9 min read
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. The best part? Saving on groceries doesn’t have to mean skimping on delicious meals or depriving yourself of quality produce.
So, want to learn how to go grocery shopping on a budget? In this article, we'll cover some simple but effective tips for saving money on groceries.
If you want to start saving money, grocery shopping on a budget is a good place to begin.
But what does a “budget” really look like when it comes to groceries? It depends where you live. The European Union’s Eurostat office has compiled an interactive list of consumer grocery prices in EU member states that may be helpful in level-setting. If you live in a country that’s higher than the EU average, you’ll likely need to set aside more money for your groceries.
If you’re looking to work off an average figure, the UK’s Office of National Statistics estimates that the average person spends around €123 per month on groceries. That’s around €31 a week—not including money spent eating out. For every additional member in your household, these numbers double.
This means that while a couple spends around €247 (roughly €123 multiplied by two) per month on groceries, a three-person household spends close to €370, and a four-person household racks up nearly €494 a month on groceries alone!
Using the above numbers as a guide, if you were to spend roughly €20 instead of €30 on groceries a week, you’d save €40 a month. Those kinds of numbers could add up to over €450 a year! That is a sizable contribution to your yearly budgeting goals which could include paying off an overdraft, saving for a luxury item, or building up an emergency fund.
However, before you create your monthly grocery budget, it’s a good idea to create a budget for your finances as a whole to give you more control over your financial health. This means doing the following:
Using your budget to navigate how much you want to save on your grocery bill each month, let’s look at how you can create your ideal budget grocery list.
When it comes to grocery shopping on a budget, simplicity is key. 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!
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. If you’re feeling lost or uninspired, we’ve put together some shopping list ideas to help you get started.
It’s no secret that meat is one of the most expensive food products you can buy, especially if you’re trying to buy organic. So, a great workaround is to give yourself the challenge of going meat-free at least one day a week.
Not only will this save you money and improve your vegetarian recipe repertoire, but you may find it’s not as hard as it sounds. If this leads you to eat even less meat in the long term, well, that’s just more money in the bank.
With the above tip in mind, here’s what a healthy grocery list on a budget could look like for a vegetarian or vegan while sticking with a max expenditure of €22 a week:
Though this may not sound like a lot, for €7, you could buy a range of different vegetables, which, when paired with the rice or pulses, could form the centerpiece of your evening meal for six days of the week. For the remaining day, tofu could be the star ingredient.
The oats and almond milk could form the basis for a filling breakfast, and you could make sandwiches with the bread, plant-based spreads, and any remaining vegetables for lunch.
Now, let’s look at some ways you can actively save money while you’re out grocery shopping.
Once you know how much you want to save each month, there are a few tricks and tips for saving money on groceries that you should put into action while out shopping.
To keep a clear overview of how much you’re spending while shopping, keep track of how much everything in your basket costs. This could mean using the calculator on your phone or rounding all the prices up to whole numbers, making them easier to add together in your head. This prevents you from accidentally overspending.
A great tip for saving money on groceries is to use a budgeting tool like Dave Ramsey’s envelope budgeting system. This budgeting method requires you 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. By paying for your groceries with a fixed amount of physical cash, it makes it virtually impossible to overspend.
To encourage you to overspend on your grocery budget, some supermarkets put their most expensive products at eye-level. 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.
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.
Another great tip for grocery shopping on a budget is to compare grocery prices by weight, not by the displayed retail price. Usually, in addition to the retail price, you can find how much each product costs per 100g. This is the figure you should use when comparing other similar products.
For example, if you want to buy some parmesan cheese but there are two different types priced at €4 and €6, you might think that the most economical choice would be to opt for the €4 pack. However, when you look at the price by weight, you may realize that while the €6 parmesan costs €1 per 100g, the €4 pack costs €2 per 100g.
This means that though it costs €2 more, the €6 pack of parmesan is 50% cheaper than the €4 pack and gives you an extra 200g for only an additional €2.
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.
This could mean going from shop to shop and making a note of the difference in prices for the groceries that you buy most often. You’ll soon make it a habit to go to different stores depending on the type of groceries you need to buy. Note, however, that these prices may vary depending on the season and any promotions a shop may be running at the time.
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.
Just as with your general budget, it’s essential to keep track of your grocery expenditures once you finish shopping. This could mean entering the figures into an Excel spreadsheet, a manual budgeting app or a budgeting app that’s fully integrated with your bank account. N26 makes it easy to see where your money is going with N26 Insights, which automatically breaks your spending down into different categories.
At N26, we make budgeting simple.
With our free bank account, you’ll receive push notifications every time a transaction takes place. And you can even set daily spending limits to encourage yourself to stay on track.
With an N26 premium account, you can also use N26 Spaces to create up to 10 sub-accounts—including one for groceries. And our in-app Rules feature allows you to automatically move money between your main account and your Spaces sub-accounts—as well as between individual sub-accounts themselves.
By N26
Love your bank
What to include in your family budget
5 min read
5 smart budgeting tips for first-time savers
Budgeting doesn’t need to be stressful or confusing. These simple budgeting tips show you how you can start saving today.
The 50/30/20 rule: how to budget your money more efficiently
The 50/30/20 budget is beautiful in its simplicity. It can help you divide your income into categories that make saving easy.
How to budget for household expenses
Developing a household budget takes some work, but it’s always a good idea to dive into your spending habits to see where you could save some cash. Read our tips on budgeting for household expenses.