r u l y

"Check 044933." Photo by Steve Snodgrass. From the Flickr Creative Commons.

The first question in my November healthy eating experiment was whether eating at home would aid weight loss and make you healthier.  I told you my results on that yesterday.  The second question in my experiment was whether eating at home saves you money?

Logically, you would think the answer is an automatic yes.  You can listen to the opinions of Suze Orman and Peter Walsh on this or you can run some numbers yourself.

Quantifying the cost of meals at home takes some time and effort and probably few people really do this.  When I looked at my own grocery receipts for the month, it was a little tough to calculate the cost of each recipe.  For example, you don’t buy celery one stalk at a time but rather in one big bunch.  You also can’t buy spices one tablespoon at a time and have to purchase a large bottle.  You may also have some staples at home like flour or rice that you didn’t have to buy.  For simplicity, I calculated the cost of each recipe as just the groceries I had to buy.  If I had to buy a bottle of spices, I put in the cost of the whole bottle but if I used the same ingredient for multiple recipes (like celery) then I spread the cost of the celery bunch over multiple recipes.  I did not account for staples like eggs, milk, butter, flour, oil, etc. that we always stock whether we are cooking or not or didn’t buy this month.  You could probably add on about a dollar to the cost per serving for this.

Here are some examples of our food costs:

Recipe	Groceries Cost	Cost per serving
Blueberry Orange Smoothie	$20.58	$0.99
Collard Greens	$6.00	$0.99
Beet Soup	$5.66	$1.42
White Bean Soup	$7.94	$1.98
Green Curry Thai Soup	$10.60	$2.65
Cabbage and Sausage	$6.32	$3.16
Mini Pumpkin Pies	$5.58	$0.23
Gourmet Sweet Potato Pie	$9.93	$0.83

When you look at these numbers your first instinct is probably to say, “Wow!  That’s so cheap!”  There isn’t a restaurant around that charges per serving prices like those.  You would expect that those dollars go right back into your pocket.

But this is where it gets complicated.

When I compared my total food budget for November (eating out plus groceries) with the last five months, the savings weren’t as high as you might guess.   (We looked at a five month span because our food budget goes up and down depending on whether we have guests visiting, we are hosting a party, etc.)

Money Saved: $27 – $400

The total savings eating at home ranged from an impressive $400 to a rather paltry $27.  While $27 a month over the course of a year is $324, when you factor in the amount of work to cook and wash dishes, $27 is hardly inspiring.  We also don’t tend to eat out much at high end restaurants and know of several yummy places (aside from McDonald’s and Taco Bell) where we can feed our entire family for a grand total of $20 – $30.  One friend found that he and his wife actually spent more money cooking at home because they were cooking similar high-end meals to restaurant fare.

When I looked over the past five months, I found that we keep a pretty good balance between grocery and eating out money.  If we are eating out a lot, we buy fewer groceries.  If we buy a lot of groceries, we eat out less.

We also have to put aside some money for eating out for my husband’s lunches at work.  He has built an impressive network of colleagues that frequently go out for lunch or have happy hours.  If these were just social lunches, he could skip them and bring a lunch to eat at his desk.  However, since these lunches have generally built the network that he relies on for his employment and have directly or indirectly resulted in his last several jobs, it would be a foolish bargain to sacrifice them.  In his field, people like to get away from the office to have important conversations.  Not every office works this way and I have seen several offices where people are too busy to go out to eat.  In this situation, you might network better in the office lunchroom than the corner restaurant.  So you have to gauge this for yourself.

Why doesn’t eating at home generate more savings?  I think the primary reason has to do with waste.  Even the most frugal person is going to waste some food money eating at home.  Your recipe might not turn out as expected and you throw away what you don’t want to eat.  You might accidentally overcook something and have to throw it out.  You might forget to use your perishable produce before it spoils.  Even if you manage to avoid these pitfalls, there is some built-in waste in the food buying process.  For example, you pay by the pound for your produce but there are parts of that produce (carrot tops, onion skins, etc.) that most people cut off and don’t eat.  You might have to buy special ingredients that are only available in large quantities for a recipe you make only occasionally.

There is also an interesting psychological effect that happens when eating at home (at least for me).  I tend to look at the food I have prepared and think, “It was so much work to make this plus we spent good money on the groceries for it so we better eat all of it.”  We don’t like to eat leftovers for more than a day or two after the initial meal so we hurry to eat the food while it is still relatively fresh.  Because of this, we may end up eating more than we might if we were at a restaurant which may also be increasing the grocery bill.

So, bottom line, does eating at home really save you money?

It depends.

If you want to this answer to be a definitive yes, you have to assume either that people are eating out constantly (at least one meal per day), or that people are eating at relatively expensive restaurants.  You also have to assume that people will trade down their food choices at home to be something less indulgent than what you eat in a restaurant.  Peanut butter and jelly sandwiches, for example, rather than turkey, swiss, avocado and sprouts. (mmmm!)  If you are an incredible cook and an avid coupon shopper you may be able to really maximize your savings but these are skills that build up over time and not everyone will see this success right away when they first start eating at home.

The answer shifts more to a no (or not much) if you already eat at home quite a bit and eat out only on occasion.  It also is more likely to be no if you know how to eat out inexpensively, if you are trying to reproduce restaurant meals or gourmet cooking at home or if you waste a lot of groceries due to food spoilage or bad cooking.

Now, there are certainly many other reasons to cook at home aside from financial ones.  Some people just really enjoy cooking.  Others might have food allergies, religious or health preferences that require that they know exactly what ingredients go into their food.  Some may fear how their children will behave in a restaurant.

There is no “right” answer to this question.  We each have to balance it for ourselves.

As for me, I will feel a little less guilty eating out now.  We still can save some money eating at home but there is no need to eat at home exclusively under the guise of saving money.  On this point, I think of some of the frugal, retired people I know who like to eat at all-you-can-eat buffets or order the Happy Meal at McDonald’s, giving the toy away to eager kids dining nearby.

How do you balance the expense of eating out versus cooking at home?  Please share in the comments.

P.S.  It was also interesting to compare this experiment with my eat-from-the-pantry experiment in 2009 where I saved approximately $600 eating at home.

Be Sociable, Share!

•