The following post is by MPFJ staff writer Travis, who also blogs at Enemy of Debt . Travis candidly shares his personal journey to pay off $109,000 of credit card debt and the tips he’s learned along the way. As a father and husband he provides a unique perspective on balancing debt, finances, and family.
You can’t change what you don’t track.
The concept of tracking your spending is one that I’ve both read and written about many times, but I just heard the above phrase for the first time recently.  The premise behind tracking your spending is fairly simple; write down everything you spend, then use that information to build a realistic budget. If the number for a particular expense seems too high, you need to put some effort into determining how you bring your spending down for that category.   This is where my opening statement comes into play. If you don’t know how much you’re spending, or what you’re spending it on, there’s no possible way you can make any kind of educated decision as to whether your spending is in line with your expectations.
I’ve been thinking a lot about the above statement as I haven’t been very happy with the results of my grocery shopping lately. When we finished our debt management plan paying off over $109,000 in credit card debt one area that we immediately increased in our budget was the weekly grocery amount. Adding some extra special items to our meal planning each week was something we determined was a good use of some of the extra funds we had available after that final payment was made.
The problem was, as I looked at my grocery cart waiting for the cashier, I saw a lot of things in the cart that had nothing to do with making actual meals. I will admit that when I say the term grocery budget, I really mean pretty much anything I’d by at the grocery store including food, snacks, toiletries, and pet supplies. I started wondering what percentage of my grocery budget each of those categories represented.   That opening phrase popped into my head again.
You can’t change what you don’t track.
It was time to go to work on my grocery spending. Even though I was staying on budget with my overall grocery spending, I wanted to ensure I was getting what I wanted out of my trips to the grocery store. I decided that I was going to shop as normal for three weeks, and save my receipts. After that third trip to the grocery store I would sit down and analyze what I was purchasing and see what revelations I could find.
The Ground Rules
- Grocery shopping is to be done normally, not altering my process or current shopping habits
- This experiment will run for three weeks, after which I will analyze the products purchased from the three saved receipts.
- Products will be split into the following defined categories;
- Food: items used directly for meals
- Snacks: items that are eaten between meals, or during the evening. Example: chips, snack crackers, ice cream.
- Drinks: Non-essential drinks such as bottled water, soda, Gatorade, or lemonade
- Pets: Items for our two cats such as cat food and cat litter.
- Household: Nonfood items such as laundry detergent, dish detergent, toiletries, paper towels
The Results
Week 1:
• Food: 58.8% ($95.37)
• Drinks: 7.7% ($12.60)
• Pets: 4.8% ($7.84)
• Household: 15.9% ($25.89)
• Snacks: 12.8% (20.74)
Total: $162.44
Week 2:
• Food: 51.7% ($71.38)
• Drinks: 10.1% ($13.98)
• Pets: 0% ($0)
• Household: 11.6% ($15.94)
• Snacks: 26.6% ($36.74)
Total: $138.02
Week 3:
• Food: 58.8% ($92.57)
• Drinks: 14.0% ($22.02)
• Pets: 9% ($14.12)
• Household: 4.5% ($7.11)
• Snacks: 13.7% ($21.64)
Total: $157.46
Three Week Average:
• Food: 56.6% ($86.44)
• Drinks: 10.6% ($16.20)
• Pets: 4.8% ($7.32)
• Household: 10.7% ( $16.31)
• Snacks: 17.3% ($26.37)
Total: $152.64
Analysis
I was fairly happy with the breakdown of my grocery spending with the exception of the Snacks category.  The percentage, and the raw dollar amount spent, surprised me. We do not need to spend close to 20% of our budget on snacks, so I’ll be looking to reallocate some of that spending into the main Food category. Ideally, I’d like to see Food at about 65%, and Snacks closer to 10% of our grocery spending breakdown. The other categories are right where I would expect, and want them to be.
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Action Plan
In preparation to go grocery shopping, my wife and I make a meal plan for the week, then I write a list of the items we need to execute that meal plan. I then add in any additional wants or needs from the family and estimate the price. In the past, as long as the bottom line was within our $150 weekly grocery budget (give or take a few dollars) I was ready to roll.
However this week I’m going to break down the items on the list according to these 5 categories, and then ensure that each category adheres to the following target percentages:
- Food: 65%
- Drinks: 10%
- Pets: 5%
- Household: 10%
- Snacks: 10%
The hope is that by purchasing more of, and better quality food for meals that we will need less snacks, leaving myself (and the whole family) much more satisfied with the food we have in our home.
How about you all? Have you ever broken down your grocery shopping purchases to get a glimpse as to what you’re really getting for your money? Give it a try, you may be surprised!
***Image courtesy of Vichaya Kiatying-Angsule at FreeDigitalPhotos.net
