Average Monthly Grocery Costs for Households

In recent years, rising food prices have put a strain on consumers’ budgets, with many feeling the pinch at the checkout. A recent price increase at Trader Joe’s—a four-cent hike on bananas—has stirred significant buzz, marking the grocery chain’s first price adjustment in over two decades. Although this jump from 19 to 23 cents may seem minor, the roughly 20% increase has prompted questions about how much households should be spending on groceries each month.

We analyzed average monthly grocery costs for different household sizes across the U.S. Here’s what we discovered:

Average Monthly Grocery Spending

According to the latest data from the U.S. Bureau of Labor Statistics (2022), the average American household spends approximately $475.25 a month on groceries, totaling about $5,703 annually.

Food prices have fluctuated since the pandemic, but there is some relief: grocery costs increased by only 1.2% over the past year, as reported by the Consumer Price Index (CPI) in March 2024. This is a significant slowdown compared to the over 13% increase in 2022.

The CPI report also indicates that “food at home” prices rose less than 1% in the last six months, while “food away from home” (dining out) saw an increase of about 2%.

For a detailed breakdown, the U.S. Department of Agriculture’s Monthly Cost of Food Report from January 2024 provides monthly budget guidelines by age and gender, along with four spending levels: Thrifty, Low-Cost, Moderate-Cost, and Liberal.

USDA Monthly Grocery Budgets

• For One Person:
  • Thrifty Plan: $275.63
  • Liberal Plan: $434.33
• For Two People:
  • Male and Female: $514.09 to $819.26
  • Two Adult Females: $476.92 to $769.86
  • Two Adult Males: $551.26 to $868.66

Are Food Costs Increasing?

The recent Trader Joe’s banana price hike is just one example of the broader trend in food costs. Over the past year, average food costs have risen by 2.6%, with significant increases in “food away from home” (up 5.1%) and non-alcoholic beverages (up 3.4%). Conversely, some categories, such as dairy (down 1.1%) and meat, fish, poultry, and eggs (down 0.9%), have seen price drops.

How to Set a Food Budget

To determine an appropriate food budget, consider household size and dietary needs. Start with the USDA’s monthly budget plans and adjust based on your family’s specific requirements. Keep track of both grocery spending and dining out to get a complete picture. If needed, adjust your budget by focusing on home-cooked meals, which are often more nutritious and economical compared to dining out.

Tips for Saving on Groceries

To save on groceries, combine strategies like couponing with cash-back apps such as Ibotta and Capital One Savings. Shopping sales, buying seasonal items, and sticking to a meal plan can also help. Credit cards with grocery rewards, such as the Blue Cash Preferred® Card from American Express or the Costco Anywhere Visa® Card, can provide additional savings, though it’s important to manage credit responsibly.

Is Eating Out Cheaper?

Generally, eating at home is more cost-effective than dining out. While fast food offers convenience, home-cooked meals are often healthier and more budget-friendly. Restaurants mark up food prices to cover ingredients and labor, making cooking at home a more economical choice.