One of the first steps in any financial-planning process is to lay out a working budget. Busking outside the liquor store isn't a practical option for most people, so you've got to work with the income you already have. The money you spend on eating out is one target many planners focus on. You don't need to eliminate it, just make sure the amount you're spending fits your budget.
By late 2011, Americans were spending an average of approximately 4.5 percent of their income on eating out, according to a 2012 article on the MSN Money website. If you're pulling down $40,000, that would work out to $1,800 annually, or $150 each month. By comparison the U.S. Department of Agriculture estimates that a moderate grocery bill for a couple in the U.S. would average just under $600 per month. Those two numbers can provide you with a useful set of benchmarks for planning your own budget.
One thing to bear in mind is that averages are only a guideline. Within reason, you can raise or lower your food spending as needed. Take care of priorities first: insurance, health care, debt payments, emergency funds and retirement planning are all important. Once you've allocated money for your expenses and your goals, decide how much of what's left is available to meet your food needs. As long as your food spending stays within your budget, you can decide how much to spend on groceries as opposed to eating out.
In and Out
This thought process is built on an underlying assumption that eating in is frugal and virtuous, while eating out is the lazy and expensive option. The reality is a bit more complex. Eating at home can be cheaper, and it certainly gives you better control over the quality and nutritional content of your meals. However, restaurants have the advantage of buying their ingredients in wholesale quantities, and they can often serve a meal for less than it would cost to make it at home. There's also the time factor to consider: You could be earning money, instead of cooking. Where you draw that line is a matter of personal preference.
Comparing to the Average
Averages are well and good, but if you don't track your current spending, you won't know how it compares. For a month, keep the receipts for everything you spend on food. That includes lunches, cups of coffee, the occasional cocktail after work and your groceries. Add up the receipts at the end of the month so you can see how much you spend on eating at home and dining out. If your overall number is within the average range and your budget is otherwise healthy, there's little financial reason to change.
A Balanced Strategy
That doesn't necessarily mean you shouldn't change things up. It depends where you place your priorities. If you'd like to spend more of your time and budget on eating at home, then by all means eat out less often. Work-related eating is a good target, since you're not usually lunching together. You might choose to trim routine, grab-and-go meals from your budget, using the savings for two or three better meals instead. That strategy trades rushed and inferior food for quality time together and a memorable dining experience. Spend the remaining evenings at home, eating fresh foods and improving your cooking skills.
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