Budgets and Economics

I love being in the kitchen. But that doesn’t just mean cooking and eating. I love to buy food for my kitchen – I don’t think I have ever spent less than $20 at a farmers’ market (and I’ve been going steadily to whatever market is closest to me since 2003) and I ought to just set up expense accounts at the food coops I frequent. Even when I don’t really need anything except more eggs I find myself buying the dark chocolate on sale, the bag of dried dates because we are running sort of low, the day-old bread that will be great french toast, and that new brand of peanut butter I’ve been curious about. This started to change when Travis and I got married. Sharing an income with someone, especially when that person brings in the bulk of the income and you have the bulk of responsibility for managing it, brings all kinds of trickiness into the equation. For me, it’s harder to rationalize all that food buying when I have to look at the accounting. It’s taken some time, but I’ve actually come to love this. I still love to spend money on food but I’ve become much more cautious about over-stocking the kitchen and buying just to buy. I use a budget, I stick to it, and I like that.

There, I said it! My name is Riva and a I am a total budget geek. I have spreadsheets, I keep and record receipts, and I had a great time in January reviewing the 2013 numbers and making  my 2014 estimates. But this isn’t just about me. It’s about my home and my household and the kind of household manager I want to be. See, home economics is actually a redundant expression – the word economics came into use in the 16th century and originally referred to the science of household management and it is derived from the Greek oikonomikos meaning “practiced in the management of a household or family”; I suspect that adding home to the front of economics has happened as the home has gradually become a site of consumption rather than production*. However, in 2014, I would like to reclaim economics as a household term, and I take pride in learning to be a better and better economist every year. And for me, a huge part of that is the thrifty and effective use of our money.

Although food is one of the most variable and controllable parts of our budget, it is not even close to the largest part of our budget. In fact, Americans have the dubious privilege of spending less on food as a percentage of income than any other developed country: 6-9% depending on which source you look at.

FoodExpenditureGraph*source: Atlantic Magazine

FoodExpenditureMap*yes, the map is hard to read – but Europe is in the upper-middle, Africa is in the bottom-middle… and that tiny speck off to the left above South America? That’s the U.S.  (source: Washington State University magazine)

This has not always been true – 30 years ago we were spending 17% of our income on food (Atlantic Magazine). But policies subsidizing large-scale agricultural production and normalizing cheap food have skewed that spending**.

So now, with our personal beliefs about fair prices for farmers, about ending subsidies for large-scale agriculture, and about our family’s health being highly impacted by our relationship to food, Travis and I have decided to spend 15-20% of our income on what we eat. Obviously, this has been great news for me and my food buying addiction! And despite the challenges of making time to keep records, it’s been incredibly fun becoming a better economist. I recommend everyone try it. And in the spirit of convincing you, and of just sharing information that may be helpful or interesting, here are some of our food-financial details from 2013:

  • We spent, on average, $734.59 a month on food in 2013. The low was $491.81 in January when I was visiting family in Seattle and Travis was in Ethiopia; the high of $1,377.26 was in October when we had a houseguest for 3 weeks, I bought some things in advance for Thanksgiving, and we paid for several bulk orders of foodstuffs.
  • For the months when I started specifically tracking “eating out”, restaurants averaged out to 19% of those monthly food expenses.
  • We spent $776.68 on bulk purchases, including $200 on a large frozen fish order from Vital Choice Seafood, $51.68 on a large order of hazelnuts and pecans in the shell from an online nut company, $350 on half a pig raised by a dear friend, and $175 on a grain and bean CSA. This represented 7.4% of our annual food expenses.
  • Our annual food expenses were $10,493.54.
  • We spent 15.2% of our gross income on food – a little low, but we made our goal!

2013 was more about collecting data and developing a budget strategy. Here’s what we’ve got going forward into 2014:

  • Categories aligned with our purchasing habits. This makes tracking our budget easier and more effective. I started 2013 writing down every individual item and eventually gave that up because I found it was actually the categories that I was interested in. Our categories for 2014 food items are groceries, bulk purchases, booze, eating out, and direct from the farm (and for now, anything in large quantity will be a bulk purchase and direct from farm will apply to farmers’ markets and farm-stands). Eventually I would like to know how much we spend on certain staples like eggs, but that’s more for curiosity than actual budgeting and decision-making.
  • Planning around the trends. I spend more in October and November with Thanksgiving and lead up to the holidays than I do in the mid-summer months when we grow some of our own vegetables and simply eat less because of the heat. We also spend more on food whenever we have houseguests or dinner guests. Being able to identify which events in our daily lives changes what is normal or average helps me budget for those events in the future. Some months simply have larger food budgets.
  • Bulking up the bulk purchases. We only spent 7.4% of our food budget on bulk purchases, and I’d like to increase that this year. Bulk purchases usually reduce the individual cost of the item, it usually saves on the energy required to ship or transport something, and it supports farmers who are not in the business of marketing small quantities of their products. From a financial perspective it does skew the budget – a large purchase is made during one month but is stretched out and consumed over many months. My assumption, or hope, is that we will do this frequently enough to even out the bumps and skews – each month will have its featured one or two “bulk items.” This January, for example, I got 10 pounds of organic lemons from California for fun preserving projects (and yes, those projects will be featured in a blog post this spring). Every August I spend $60-$80 with Carol, my mother-in-law, at our favorite pick your own blueberry farm in Vermont and then I freeze most of what I pick. Tracking 2014 bulk purchases will help me figure out whether I have bulked up the bulk purchasing since 2013 and will help me anticipate budgeting it out in 2015.
  • Tracking the eating out purchases. If you’ve read my New Year’s Resolution post you know that we’ve got big plans for eating veggie when eating out unless we’re at a restaurant that features happy meat on the menu. Travis also loves going out to Happy Hour or just for a snack, so I’d like to make room in the budget for that. This will require planning ahead a bit so I don’t have so many leftovers that I resent eating out! We want to be sure our eating out percentage stays low but that we do it regularly, and that when we decide to go out, it’s an enjoyable treat in line with both our budget and our values.

If this is sounding like an interesting exercise to you, great! Start by writing down every food purchase. It’s tedious, I know, I did it for several months before I decided to stop. But it creates a kind of awareness that cannot be created any other way – it’s the same reason weight-loss programs tell you to write down everything you eat. Writing it down makes it real. My mother watched me copy receipts into my notebook one night and asked (reasonably so) why I didn’t just tape the receipts in on the pages? For starters, receipts do fade over time and I like the idea of a historical record of my food purchases. But also, having to actually write your purchases down with your hand does something to you. I found myself reaching for butter one week and then thought, “Wait. I bought butter earlier this week. Do I need to make another pie so much so that I’m ready to write down for posterity how much butter I was capable of purchasing in one week for a family of three?” And I didn’t buy it. Which was good cause we really didn’t need that other pie. I made a crisp instead.

It’s probably clear from this post how seriously I view the topic of food purchases. What we spend on food affects our agricultural system, affects the long-term sustainability of our communities, and affects our health every day. Yes, it’s my soapbox. But that doesn’t mean I’m not on to something here! After all, what could be more important than our families, our homes, and our health? And what could be more empowering than taking charge of our finances and our pantries? I suggest we all take a crack at our food budgets and start reclaiming the term economics.

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*For serious and lovely politics about work, home, and agriculture read Wendell Berry’s collection of essays The Unsettling of America. For instance, from pp.31-32: “Once, of course, the idea of a farm included the idea of a household: an integral and major part of a farm’s economy was the economy of its own household; the family that owned and worked the farm lived from it…the household was therefore not merely a unit in the economy of food production; its members practiced essential productive skills….[but over time] the household became simply a house or residence, purely consumptive in its function; the farm ceased to be a place to live and a way of life and became a unit of production – and their once collaborative relationship became competitive.” I love this man. I do.

**People deserve access to affordable, healthy, fresh food. But making processed foods and certain kinds of mass-grown produce cheaper through subsidies is not an effective solution. What about raising salaries? What about rejecting a culture that is built around $150/month data plans for our smart phones while nutrition-based health problems are on the rise? We are not entitled to cheap food, and it didn’t come from nowhere. Read this article in Mother Jones Magazine summarizing Earl Butz and Richard Nixon’s 1970s policies that changed the foodscape in America (and if you’re hooked, pick Wendell Berry’s The Unsettling of America back up). Then read Joseph Stiglitz’s great article about food stamps and American food policy here. Then call me up and let’s get some (fair trade, fairly-priced) coffee and discuss.

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One comment

  1. Miquela

    I came across your blog some months back when trying to find info on pudding with arrowroot powder vs cornstarch. I admit to taking your advice and running, not bothering to looking around or comment. Today, when I googled the same thing and came back here, I decided to read a few entries. I enjoyed your thoughts and the obvious care you take to write your posts, including studies and quotes. I’ve been encouraged to do two things, nay three: 1) Resume my accounting about our household budgets, 2) Get ahold of some Wendell Berry (his name has been popping up on my radar for the last year), 3) Start following your blog.

    I just had a baby two months ago, so I may not be very chatty; but I’ll be here, reading and contemplating.

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