Groceries vs. Dining Out

Look at this article on the cost of dining out. For the first time EVER, Americans are spending more money to eat out than they are on groceries. Wow. Impressive, right? Well, maybe for the restaurant industry, but not for those who should be paying off debt or trying to retire early.

And while there aren’t too many details surrounding the demographics, the article does hint that those ages 25-34 are more likely to want to dine out. Probably because they may not have spouses or families yet, so they have more time and income to socialize with their friends. I also think many young single folks never watched their parents cook from scratch, and don’t know how to do prepare anything more complex than Kraft mac and cheese.

This made me think about how dining out can affect our desire to be financially responsible. I googled online for average amount spent on eating out.  The answers are all over the place, but $225 seems to be a common number. And this neat chart shows average cost of groceries for each member of the family, based on whether you are thrifty or liberal in your spending.

So, how does my family stack up? First let’s look at groceries. I think we eat pretty well. We cook steak and shrimp at least once a month, have meat at most (too many) of our dinners, etc. We both like to cook, so we feel quite capable and equipped to make nice meals.

Because this chart is dated March 2015, I pulled my average grocery spending from YNAB data from January 2015 through August 2016. It is about $735 per month. I have three adults in my house (51 yo male, 49 yo female, 17 yo female) and one child (9 yo female). This puts me somewhere between being a thrifty grocery shopper ($646/month) and a low-cost grocery shopper ($848/month) for my family. And I think I’m treating us with our yummy food!

I suspect that these numbers are based on families in the moderate and liberal spending categories who buy a lot of prepared food?

As for dining out, well, I’m not so thrifty…even if I think I am when I play the comparison game. My eating out for that same time period averages $450 per month! This does not include school lunches at an average cost of $25/month, or meals while traveling, at an average of $175/month. If I include that in my monthly average, it soars to $650/month, not too much less than my grocery spending!

First, I looked at what percentage of my income all the food expenses total. Thus far in 2016, food (all of it…dining out, groceries, school lunches, and travel) has represented 15% of all my spending. Please note that this is NOT the percentage of my income, as taxes, retirement, and college savings are otherwise removed. If I estimate my spending for the rest of the year to an annual $17,379, and compare it to my total gross income, it’s not so bad…about 7.2%.

But still, I’m averaging nearly $1500 a month to eat! Even I remove the meals while traveling (because I like to think of that as part of my travel budget), it’s 5.8% of my gross income and $1164/month.

I think I could easily trim this to $1000/month. It wouldn’t take more than shifting one or two meals out to home-cooked meals. Just the other day, we had dinner at a local pizza/pasta chain. The meal, with tip, was $57. And honestly, it wasn’t that good. I’d rather eat out half as often and spend twice as much for great food. Three of us ate pasta at this meal, something we could have cooked at home for just a few dollars and in the same amount of time it took us to get to the restaurant.

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