Tag Archives: CPM

August Food Budget – Considering The Plateau

plateau

Bears a resemblance to the stock market these days, no?

It’s time for the latest installment of my yearlong quest to track and trim my food budget. For those of you short on time, let me just say that if you remember my numbers from last month, they were very similar in August. Shockingly similar, in fact. I think we’ve possibly hit what I’m calling The Plateau. It’s not a bad place to hang out, this new baseline, but it is a bit short of the lofty goals I initially set out for myself, so there is work to be done.

There are some changes coming starting next month that will take a little pressure off our overall budgets (more on that in another post), so vigilance against lifestyle creep is more important than ever. Keeping this budget low was never about penny-pinching and always about exploring how to actually cook and love the food I eat, which just so happens to cost less than it does to be lazy on food consumption anyway. It’s no coincidence that the months our costs were lowest are also the months where I felt I invested the most time/energy in cooking. As time becomes scarcer, I need to remind myself why I continue to work on this – because it’s fun, not to mention the fact that it helps pave the way to financial independence.

Anyway – onto the numbers.

Continue reading

Advertisements

Leave a comment

Filed under Food, Numbers

May/June/July Food Budget – Time for a Reckonin’

kiwifruit

Kiwis – must be the season, because we’ve been getting a lot of them delivered to us lately

Sitting down to write this post has been a little daunting. After posting my April budget in early May and falling behind in my reporting here, it’s just felt like a lot of data to share. Even though, as I mentioned in my last post, I did collect my May/June data in early July, I never quite got around to sharing it here. The very same thing nearly happened today. However, it’s time to reckon with what’s been happening.

Unlike past months, I will not be able to state that I’ve continued to aggressively cut costs as the summer has unfolded (this may also have played a subconscious role in being in no hurry to put this post together). Food costs have definitely risen. Overall though, I’m still pretty pleased that even with less intention, our numbers routinely came in under our 2014 averages – over the span we beat it by about 8%. If that’s the new baseline, then great. I didn’t even shop at my wholesaler since March – March! I’m paying for a membership there. That needs to be rectified.

Ok, let’s dive into the numbers – now featuring a spiffy new chart.

Continue reading

Leave a comment

Filed under Food, Numbers

April Food Budget – Holding the Pace

bulk-foodAnother month, another measured look at whether we were able to keep up with our progressively lower food cost goals.

From February to March we excitingly saw a 13% dip in total food expenditure (which translated to a 20% dip in cost per meal, given the shortage of days in February). That coming on the heels of February, the first month of our food challenge, already representing a 22% drop compared to our 2014 averages. This was a pretty fantastic start, but I predicted last month that we would not be able to see such a substantial reduction again. I would have loved to prove myself wrong though.

Rather than keep you in suspense, I’ll come clean that we did not reduce our spending by another 20% – in fact, spending went up. But I’m still happy with the month and we remain right on the pace I was hoping for.

Continue reading

Leave a comment

Filed under Food, Numbers

March Food Budget – Still on Track?

Photo via Miroslav Vajdić

I’ve been on a bit of a blog haitus for the past few weeks, so I thought I’d ease myself back into things with a numbers post. Halfway through the month of April, it’s time to look back and see if I’ve been keeping up with my goals of reining in our food budget.

As I spelled out back in early February, I’d set $10 per person per day as a reasonable ceiling for a food budget. It’s a lot more than experienced frugal eaters spend, but it felt like a reasonable benchmark to start with, and then improve upon. For the month of February, excitingly, we hit the mark, reducing our food budget by about 22% compared to our 2014 averages in the process.

Now, let’s see about March.

Continue reading

Leave a comment

Filed under Food, Numbers

February Food Budget – Was Ten Dollars a Day a Stretch?

20-dollar-bill

Twenty bucks a day for our household – it’s enough!

Back in February I challenged myself to spend some of my newfound unemployed-time trying to lower the food budget for my partner and myself down to $10 dollars a day each, or a cost-per-meal of $3.33. While I know there are many frugal wizards who far exceed this, ten bucks a day felt like a reasonable first step to take given our current setup and habits. So how did we do in our first concerted attempt to move from intuitively not-spendy (as is our natural wont) to intentionally not-spendy (as tracked in a spreadsheet and measured against goals)?

Answer: We made it!* Barely, but we did. We reduced our spending notably compared to January as well as compared to our averages from 2014.

While giving ourselves a little pat on the back, there are a few details worth explaining. Last month was a bit of a snowpocalypse where I live, and while you might think that would increase our consumption of take-out, it actually resulted in my partner and myself having more time home together to cook and eat delicious, low-cost food, and less time out buying drinks and lunches. This month (I fervently hope!) there won’t be quite so many snow days. On the other hand, on Feb 24th I went out and bought a ton of bulk goods that we’ve barely touched yet, so we’re swimming in lentils, nuts, beans, and diced tomatoes. That bodes well for lowering our CPM even further next month.

Let’s take a quick look at how this month compared to the past, and talk about why I’m pretty excited about landing this first step in our newly frugal food-budget gymnastics.

Back in 2014…

We began tracking our finances in Quicken in 2014. The numbers aren’t quite precise – we weren’t splitting or categorizing particularly intensely back then – and a more careful eye is being kept on 2015 numbers. While I want to keep our exact numbers slightly obscured, this should serve us as a rough baseline. Numbers are given as a percentage of total food cost.

  • Groceries purchased: 56%
  • Restaurants (includes work-lunches): 29%
  • Coffeeshops: 13%
  • Alcohol: 2%
  • Total Cost: 100% (our baseline)

We were already reasonably frugal, but what stands out to me is that while our net groceries cost was actually pretty solid, it was much too small a percentage of our overall total – our restaurants and coffeeshop numbers take up far too much space. Alcohol was almost negligible at about 2%, which was actually a little surprising.

Based on this, it makes sense that the first place we’d be able to work on is reducing the restaurant/coffeeshop numbers without inflating the grocery bill by much. A large portion of those categories are nefarious work-related expenses that creep up (lunches, coffees) that we were already beginning to think about attacking during the end of the year.

In January… (percentages relative to 2014 averages)

  • Groceries purchased: 144%
  • Restaurants (includes work-lunches): 68%
  • Coffeeshops: 57%
  • Alcohol: 159%
  • Total Cost: 111%

In January, before I received the ol’ pink slip and was just beginning to track more carefully, there were conflicting trends. Our grocery and alcohol bill shot way up, while at the same time our restaurants and coffeeshops numbers both dropped way down. This is a classic good news/bad news reading, and our overall costs were 11% higher. However, we had the enjoyable experience of hosting a New Year’s party, which accounts for a large portion of those increases (and probably belonged in December anyway). We also subscribe to a weekly CSA-type program, and because January had five Fridays, we got the bill five times this month. A few home items may not have been split out early in the month too.

If you took out these “non-standard” extras, we’d knock about 17% off our expenses for this month, and we’d duck below our 2014 averages. Considering the gains in the target categories, all in all this month was not too bad – it seems clear strides were being made.

In February… (percentages relative to 2014 averages)

  • Groceries purchased: 104%
  • Restaurants (includes work-lunches): 39%
  • Coffeeshops: 44%
  • Alcohol: 87%
  • Other: Annualized cost of wholesaler membership, my best guess for cash I spent on pizza – the occasional $2 slice is my guilty lunch pleasure (these add up to <2% of total budget, but still including in total now)
  • Total Cost: 78%

In February, I issued my $10/day challenge. As I began to track more carefully I included a few misc items for the first time. However, the big news is groceries dropped all the way back down to just a hair above the 2014 numbers, while restaurants/coffeeshops dipped for the second straight month and are now both well under 50% of what we were doing in 2014! The only alcohol this month was celebration/consolation wine my lovely partner bought me the day of my layoff, which means it probably technically belonged in January, and also reminds me of just how little I drink these days.

How it Happened

I’ve already talked a bit about some of the reasons, but the major factor was committing to making a higher percentage of our food/drink in-house. My previous work was remote and I carved an office out of coffeeshops, but in February I reduced the number of times and cost of drinks I bought out, and entirely gave up the delicious egg/cheese sandwiches I’d been occasionally indulging for breakfast. Thanks to the availability of home-cooked food my partner has also reduced lunches out. I was committed to making this possible, culminating in the first times in my life I have ever woken up at 7am to make not breakfast, but lunch.  We also baked three batches of cookies this month, reducing our external dessert budget to almost nil. I give the new integration of bulk shopping credit for this resulting in only the smallest of increases from our typical 2014 groceries spending.

What it Means

Our target categories are down in a big way and groceries are level – this is just what the doctor ordered. There’s a trick the famed Mr. Money Mustaches sometimes uses to make financial points, which is to calculate how much any given small-seeming sum would be if you compounded it out for a while. After 10 years at 7% interest, this food bill reduction alone would yield 3% of what we’d need to retire. My FIRE timeline is longer than that, so we can give compound interest even more time to work – at 20 years it’d bump up to 8% of our total, or at 25 years 13%. Double those numbers for what we’d need for just one of us to stay home. Not too shabby for something that primarily makes our life more delicious.

We also bought a new car early in January (of course we would do this the same month I was laid off, right? Life is not predictable), and another way to think about this is that it covers the vast majority of our payment. Hmm, eating well and an almost-free car?** Sounds like a good deal to me.

What’s Next

I am very excited by these gains – merely sustaining them would make a huge impact on our previous budget. However, I want to push further. I think I’ve only begun to tap into the savings in smarter grocery shopping and that I can get the number down further, maybe a lot further. With restaurants and coffeeshops already down considerably, the script now flips, and the most efficient goal is likely to keep those constant while reducing our grocery line. As cooking begins to feel steadily more routine and normal, restaurants will hopefully continue to fall anyway.

I’ve come up with a pair of targets to give me guidelines for the next 11 months.

In the Reasonably Ambitious Plan, I intend to reduce the ceiling for our food bill by 3% each month. This can be accomplished if we chop that restaurants number in half, and take 25% off the groceries line.

In the More Ambitious Plan, I intend to reduce the ceiling for our food bill by 5% each month. For this to work, the groceries line needs to end up getting cut fully in half as well. Harder to envision that happening from this vantage point, but I know it can be done.

A potential wrinkle in all this is that I plan to get a job sometime in the not-too-distant future, reducing the time I have to commit to all this. But in no way does that deter me from the goal of getting as good at this as I possibly can in the meantime. Not only will that mean increased short-term gains, but hopefully long-term gains will be internalized as a lifestyle change that I’ll adhere to from here on out, if I become used to it. When it can pay for my car and then shave years off my retirement date, it’s a lifestyle change that I definitely want to stick.

 

*Ok, I have to be honest, we didn’t quiiite make it, but if you include some small items (like some non-perishable food I intend to return) or other mitigating factors mentioned above then we do hit it. Even if I can’t return the goods, etc, I’m happy to call this progress a real success.

**Of course, I know there’s still insurance/gas/maintenance to think of even after the payment… but who knows, maybe this will eventually get us all the way there!

Leave a comment

Filed under Food

You Can Eat like Royalty for Ten Dollars a Day

vegetablesIn an earlier time, as a frugally-minded but financially-careless young bachelor, I decided $10 a day was a very solid baseline for a food budget. It was a nice round number and it felt about right. Cold cereal with milk couldn’t cost more than $1-2 total for two bowls, a bagel with cream cheese and/or an assortment of frozen lunches could be toasted or microwaved respectively for about $2-3, and a $5 burrito wrapped up the day. In fact, I figured that many days I probably snuck in under ten bucks, justifying the odd lunch or dinner out with friends. I felt like I was managing things reasonably, but I really have no idea how I did because I didn’t actually keep track.

I’m entirely certain I didn’t stay under $10 in terms of food consumption as I measure it today, partially because I don’t put much stock in my “I’m sure it averages out to $10” methodology, but largely because I now include alcohol and drinks like coffee in my food budget. It’s also quite obvious that my eating habits were, let’s forgivingly say, suboptimal. So if I could barely keep it to around $10 per day living off bachelor-chow, where do I get off talking about eating like royalty for that rate?

If you’re picturing nightly chalices of ale and platters of buttered pheasant, I kind of think that’s awesome, but you’re right to scoff. Of course, nobody needs to eat like glorified medieval nobility in order to eat exceptionally well. If you can adjust your perception of good eating to one that involves a varied, nutritious diet filled with delicious dishes you made yourself with your own hands, you can easily eat well for ten dollars a day.

Those that have already gotten the hang of controlling their food budget are probably nodding along paternalistically at this point – from things I’ve read, people who are really good at this can get their cost per meal somewhere around $1. I’m angling for three times that! While I would like to imagine one day getting down to around a $2 CPM (accounting for living in a relatively high-cost area and opting to pay the premium for a high percentage of organic food, this could be our floor), it seems a bit hasty to jump to that on day one. $3.33 per meal, inclusive of drinks and alcohol, seems like an appropriate first step.

There’s a question of how much of a difference a baby step can make. My partner and I are already pretty non-spendy, and according to our records from Quicken last year, we actually didn’t spend vastly more than $20/day (total) at grocery stores, which even includes some household goods like paper towels that we weren’t splitting out then. However, let’s take a hypothetical and say you’re enjoying a CPM of around $4. Cutting down to $3.33 is a 17% drop, a not-so-crazy sounding $0.67 per meal. Multiply this out over a full year’s worth of meals though and you’re saving nearly $1500 annually – per person in your household. If you’re looking for the quickest path to financial independence, invest this sum and you’ve probably just shaved years off your working life, in no small part because you’ve also reduced your lifetime expenses, forever, reducing the total you need to save even as you’re saving more.

This aspect of home stewardship was one of the original goals I had upon becoming unemployed, and I’m excited to try and implement it. To that end, I finally got it together and took my first trip to my local wholesaler, hoping to reap the benefits of bulk pricing and use it to cut my costs. Early results are mixed. For example, we don’t eat a ton of eggs, but we needed some to bake that night, so I got them there. The smallest package of organic eggs was 18, at a cost of $5.79, or $0.32 per egg. That per egg number compares extremely well with the $2.69 we usually pay for a mere six eggs, which works out to $0.45 – that’s almost 30% less! But sometimes we don’t even finish the six eggs before they go bad, so we’ll have to make a real effort to consume 18. Still, when we cooked up five eggs for the two of us yesterday at a total cost of $1.60, compared to the $1.34 it cost me a week earlier to whip up three for just myself, we were certainly making the CPM gods happy.

A longer post on wholesale shopping may come down the line later when I have a bit more experience with how it will work with our diet and lifestyle. For now, I’ll be happy to work on bringing our CPM down by shopping smarter and cooking more, hopefully blowing past my fuzzy bachelor logic for reasonable costs in no time, and setting us on a firmer path to financial independence in the process.

Leave a comment

Filed under Uncategorized