Grocery Shopping For Financial Independence
It’s an exciting time for the Sense family– we recently added a new family member to our household! As I mentioned in an earlier post, Mr. Sense and I are certified foster parents. A few weeks ago, the wonderful thirteen year old Boy Sense joined our family.
Boy Sense has known us for a couple years now, but nothing could have prepared him for the adventure I took our family on this past weekend, all in pursuit of an exciting big reveal for Mammon Sense readers. I figure this new family development presents an opportunity to discuss one budget line item we’re all familiar with: Groceries. The rumors I heard about teenagers’ appetites are holding true. Now that our household includes two active adults and two always-snacking teens, will my grocery bills take a toll on my financial independence plans?
Of course not! I have a secret weapon on my side: Aldi. If you’re not blessed with a nearby Aldi, there may be other options available. I’m also a fan of Sharp Shopper and Costco, both of which are a bit further out. There are multiple choices within reasonable driving distance of small town Staunton, and frugal readers should seek out their own price leading stores.
One might reasonably ask if the grocery store itself makes much of a difference, especially if you avoid name brand items. On Saturday, I dragged my family out to a couple stores to investigate this exact question.
To conduct a thorough investigation, we visited two local grocery stores: Martin’s (the same thing as Giant in other areas) and Aldi. Before heading out, I created a typical week’s grocery list. I compared prices at Aldi, where I typically shop, Martin’s store brand prices (when available), and Martin’s name brand prices. Martin’s had a number of items on sale, and I used the sale prices for these calculations. Here are the results:
As you can see, Aldi knocked it out of the park! For less than $100 per week (pre-tax), I easily brought home enough food for four people to eat an average of 2073 calories per day, not counting any food we pick up elsewhere. This is despite the fact that I created the list before heading to the store, whereas I typically make choices at the store based on sales. For example, my family knows I avoid buying any meat that’s missing Aldi’s distinctive red sale sticker.
So how much of a difference does conscious grocery shopping make? It turns out, a lot! According to the most recent USDA report, a family like mine spends $256.10 per week on a “low cost” budget and a shocking $384.60 on a “liberal” budget. The long term implications of that difference, especially if you wisely invest it, are staggering. I used a calculator on Investor.gov to illustrate how this works.
According to my calculations, an easy switch from Martin’s store brand items to Aldi would net a family like mine more than $30,000 over ten years, assuming the extra cash was invested and earned a reasonable 6% annual return.
Switching from name brand picks at Martin’s to Aldi for this same list would generate wealth of almost $77000 with the same assumptions.
The numbers just get more dramatic when comparing my grocery list at Aldi prices versus the government estimates.
My Aldi trip versus USDA “low cost” estimate.
My Aldi trip versus USDA “liberal” estimate.
That’s correct: easily a six figure difference over just a decade. How is this possible?!
One thing jumped out at me as I organized these numbers. Even my fancy schmancy name brand shopping number was lower than any of the government estimates. There’s a reason for this. There are a lot of things missing from my list that are considered essentials by many people, like prepared foods, most junk food, bread (we make our own; it’s better and cheaper) and alcohol (keep an eye out for a future post on why I’m taking six months off the sauce!). From a health perspective, a grocery list focused on whole foods that are still convenient and family-friendly is superior. I haven’t gone through and added up the vitamins and saturated fat content from this list, but it follows our typical diet pretty closely and works for us. As you can see, the Sense family eats a lot of broccoli– I’ll try to get Mr. Sense to disclose his tips on making vegetables in a way that won’t lead your kids to revolt.
Understanding that little decisions add up to big things is central to the FIRE mindset. Nobody consciously chooses to work to death to pay for a more expensive gallon of milk or loaf of bread, and splurging on goods that are important to us can be worthwhile. But recognizing the long term effects of supposedly minor choices, like which grocery store we hit on the way home from work, is essential to being in control of those choices and making them work for us. Doing the research and using our knowledge to make choices that align with our goals and values gives us real power over our financial futures.
A lottery ticket machine I saw at Martin’s— I have never come across one of these wealth-killers at Aldi.
