How to cut your grocery bill in half and save $1,000s

After the main four things I do to build wealth rapidly, and after cutting my cable/internet and cell phone bills down to the bone, AND after taking 15 minutes to optimize my auto insurance, groceries are the next place I save big compared to my peers. Yes, grocery shopping doesn’t sounds like a sexy way to save money– although if you slim down doing it, maybe it does…?–, but it’s very effective, potentially saving you thousands per year.

The way my wife and I shop for food can be boiled down (get it?) to seven rules of thumb. Feel free to implement any of them, since all will help you get your food bills under control.

Pick the right grocery stores

Before we get into the rules, one of the most important things is to shop at the right places for the right things. Costco is an excellent all-around choice for everything, so if you wanted to simplify your life and do all your shopping at one store, embrace the public boon that is the Costco corporation.

If you live in a city or otherwise have access to a small vegetable mart (usually run by and frequented by immigrants), that’s a great bet for cheap produce. For staples like milk, meat, dairy, eggs, and canned or dried foods, shop the sale prices at chain supermarkets like Kroger or Safeway/Von’s. (Look at the weekly advertisements they mail to you for the deals ahead of time.) Asian supermarkets are great for produce as well as Asian staples like rice, coconut milk, soy sauce, etc. (Costco also has great deals on rice and soy sauce.)

Seven rules to slash your food bill

  1. Buy in-season fruits and veggies for $1/lb or less on average. If you’re really pinching pennies, stretch them by eating them raw, or only small portions of them cooked. The idea here is to maximize flavorful and healthy calories per dollar, and (non-grain/bean) veggies provide very few calories for the money, so you need to counterintuitively treat them as luxury items. Set yourself a veggie budget of around $20/week and you should be good. (That’s still 20 lbs of produce if you can stick to the rule!)
  2. Use vegetable/Canola oil for your cooking fat and salad dressing oil of choice, and more expensive oils like olive oil in smaller amounts for flavoring. Save and cook with meat fats that render out of your food (e.g.: delicious bacon grease. Great for frying greens or potatoes in, or even using in place of shortening in pancakes.) Vegetable oil is basically the cheapest per calorie thing you can eat, and fat is good for you, including saturated fat, so go crazy on it. If you have a source of free fat, like beef or pork fat that a butcher will just give you, render your own tallow or lard and freeze it for long-term use.
  3. Buy cheaper meats on sale. Make pork and chicken your go-to meat and get them at $1 – $2/lb. Get beef on sale ($3-4/lb ideally.) Eat fish & lamb sparingly. Get chicken with the bone-in and skin-on, and pork with the bone-in. These cuts are much cheaper, especially for chicken, but also tastier due to the presence of extra fat and the flavor from the bone. Plus, you can boil the bones to make much better broth than you can buy in the store.
  4. Make cheap carbs the bedrock of your meals, and buy them dried at $1/lb or less. (Note for Atkins/keto folks: if you’re trying to lose weight, sub the carbs for extra vegetable/animal fats instead, and up your vegetable budget as needed to soak up those fats.) Choose carbs that you like to eat like rice or wheat-based products like pasta and then buy them in bulk or when they go on sale since they’ll keep a long time. Rice is a great combo of taste, goes-with-anything, and ease of prep: just stick it in a rice cooker, add water, and set it. For the price, white wheat flour is the cheapest thing I’ve seen at ~30 cents a pound at Costco. White rice can be had at Costco for $1 to 50 cents a pound. Pasta can be found on sale for 80 cents to $1 per pound, as can rolled oats if you like oatmeal. Potatoes and bread are significantly more per calorie than rice, dried pasta, or wheat flour. Potatoes need to be around 20 cents per pound to be cost competitive, and pre-made bread need to be about $1 per loaf to match $1/pound prices for dried grains.
  5. Get full-fat versions of all dairy products, including milk, yogurt, and cheeses, and stock up when they’re on sale. Going full-fat is healthier, and will also cut your cost per dairy calorie by 30 – 50% because you pay the same price for more food, since the fat is now included instead of stolen from you in a flavor-robbing crime against humanity.
  6. When food that keeps is on sale, load up! When meats or canned/dried goods go on sale, my wife and I load up our cupboards and freezers. I once bought 50 lbs of dried beans because they were on closeout for 50 cents a pound, and we routinely buy 10 or 20 lbs at a time of, say, chicken thighs, when they dip below $1/lb. If you eat cold cereal for breakfast, wait for sales or shop generic brands to buy boxes at $2/lb or less. Besides keeping the price per pound of all our staples low, this habit means we always have something to cook at home. Thaw frozen things out on the counter overnight, or under hot water– in a sealed package– if you forget to thaw in advance.
  7. Treat yourself sparingly with more expensive items like chocolate, booze, pre-made baked goods, or pricier cuts of steak or fish. Use the savings you get from the core staples of your cooking to finance the fun stuff.

If you follow these rules, you can easily keep your per person grocery spending to $200 a month, and still eat like a king: healthy food, fresh fruit and veggies, meat or dairy at every meal, and great tasting ingredients. For a couple, that means a monthly grocery budget of $500 or less. For a family of four, $800 – $1,000 or less. That’s assuming you’re eating nearly all of your meals at home. Families that eat out more frequently can spend even less on groceries, although of course they’ll spend more on food overall.

Read on if you want to get even nerdier details on how to save money on groceries, including more recommended price points for various items.

Ward’s Better Tomorrow Food Filosophy

The simple idea in each of the above rules is to center your diet around foods that cost the least per calorie, and are also tasty, healthy, and not-too-difficult to turn into meals. Because I’m a huge financial nerd, I’ve already cataloged a lot of foods by cost per calorie for you here, including notes on where to get them (again, Costco often has the best prices.)

Shop Smart

Shop Smart. Shop S-mart.

The more generalized rules for smart grocery shopping are:

  1. Shop by price per calorie/pound/unit, favoring cheap ingredients over expensive ones for the bulk of your meals.
  2. Use the weekly ads that you get from supermarket chains to know what’s on sale where (and to build a mental list of best prices), and plan your shopping accordingly. Or, just shop at Costco for everything, and use Costco’s monthly flyers to get even deeper discounts on their sales.
  3. Know what a good deal is by keeping a mental– or physical– list of the best prices that things go on sale for (e.g.: $1/lb for chicken or pork, $1/dozen eggs, $2.50/lb butter, $0.50/pound for flour, $1/lb for pasta, etc), and know what stores to look in for what things.
  4. Load up like crazy when things are on sale at or below these best prices, especially if they’re not perishable or can be frozen. If you have the space, a used chest freezer is handy for really loading up on meats.

Americans spend about half their food budgets on eating out, and the other half on eating in. I suspect wealthier folks– most of you reading– skew even higher on the eating out spending, so let me say at the outset that the best way for most people to save money in general, and on food in particular, is to eat more meals at home.


Once you’ve committed to doing that, or if you already eat a lot of meals at home, the next logical question is how much should you be spending on groceries, and how to save on them?

Know what to have on your everyday shopping list, and what price to buy it at

Load up when things are on sale, only buying below certain $s/pound or $s/unit rules

Get most of your food calories from things below $1 per meal (per 750 calories)

Veggies: Load up on cheap, in-season produce at local veggie marts, or Asian/Hispanic supermarkets, and cook them in fat or oil to boost cheap calories

Limit spending on things that either cost a lot more per calorie, or else aren’t good sources of calories for the money. The cheapest way to fill up is through fat, grains, and starchy vegetables like potatoes. There is a reason these are the staples of every single population, especially of the poor. Green, really any non-starchy, vegetables at most US supermarket prices might be/feel healthy, but buying them in excess won’t fill you up, and thus won’t help your food budget.

Meat: eat mostly skin-on, bone-in chicken and pork for $1 – $2/pound

For meats, the clear winners in terms of cost-effectiveness are bone-in, skin-on chicken and also pork (usually bone-in too.) At large supermarket chains in my city you can routinely find skin-on bone-in chicken thighs, leg quarters, or whole chickens for $1 a pound on sale (sometimes even $0.80), and even at full price it’s usually under $2/pound.

Delicious pork shoulder roasts, great for tacos, boiled dinners, or even St Louis steaks, can be had rarely for $1/lb, and often for $2/lb or less.

Even in the US where beef is relatively inexpensive, it usually costs at least 2-3x more than chicken or pork, and often much more if you’re going for higher-quality beef. Hamburger at $2/lb is a good deal, as are beef roasts for $3/lb. Occasionally Costco has T-bones or other steaks for ~$6/lb if you wanna splurge. St Patrick’s day brings cheap corned beef ($2.50/lb after the holiday) and often $3, or $4/lb, brisket that you can corn yourself if you’re so inclined.

Lamb and fish are even more expensive per calorie than beef. Shrimp and shellfish even more so. Beef, and especially lamb, are also terrible for the environment, if you wanted an extra incentive to cut back on those (sadly) delicious red meats.

Dairy & eggs – Look for weekly sales and load up, freeze butter and cheese when it’s on deep discount

Certain perishables that people use everyday like milk are hard to stock up on, but you can save a few bucks here and there by glancing at the weekly store ads you get in your mailbox. Sour cream, cottage cheese, cream, half and half and other fairly perishable dairy products should be bought like milk. (Sour cream unopened in the coldest part of your fridge, generally the back, will keep a long time.)

Eggs, however, keep for weeks or longer in your fridge, so load up when they go on sale. In Washington State, when a major pandemic is NOT in progress, large eggs can be had for $1/dozen on sale, or at least $1.50 – $2/dozen. At Costco here they’re always about $2/dozen.

For good quality cheddar or similar non-fancy pants cheeses, sales on 2 pound blocks can get you $3/lb, and you rarely should have to spend more than $4/pound. Darigold and Tillamook are excellent brands frequently on sale in the northwest.

Butter is usually $4 or $5 per pound, but in certain times of year and often during baking season (i.e: November) it’ll go on sale for a deep discount close to $2 or $2.50. Buy several pounds then and freeze it until you need it, ideally wrapper in gallon ziplocks to protect the flavor for longer storage. Buying unsalted butter gives you more cooking and baking flexibility since you can always add salt.

One of my two favorite financial bloggers, Mr. Money Mustache, has similar recommendations here.

So go out there and save big on your next grocery outing! And if you haven’t already, check out your local Costco. You’ll probably be an evangelizing convert like me for them once you go a few times.

Author: Ward Williams

Ward is an independent financial advisor at Better Tomorrow Financial. He started working as an independent investment advisor in 2009.

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