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How your food choices affect your finances

Would you go vegan or meal-plan to save money?

Emma Sorensen

Your Money contributor


When it comes to budgeting, we often treat the food we eat as a fixed expense. But it’s not.

The diet we choose can have a profound effect on our finances as well as on our health.

From meal-planning to going vegan and from eating out to eating ethically, you can eat for your wallet as well as your waistline.

Simone Austin, a dietician and spokesperson for the Dietitians Association of Australia says the best advice for eating frugally as well as healthily is not to follow a prescriptive diet, but to think of your diet as the way you eat.

As part of this, she says we should be mindful of the amount of food we eat away from home.

Eating out frequently can leave us both poorer and unhealthier.

“Many people think about eating out for dinner, but forget they’ve eaten out for morning tea or coffee or lunch a few times that week,” Austin says. “Drinks and snacks really add up so just be aware of what you’re doing.”

Making more snacks and meals at home means you’ll immediately save money, as you won’t be paying for labour, rent, profits and other markups that go into the price of restaurant- or cafe-prepared food.

If eating out is a social event, consider substituting it for an activity instead – like a walk, bike ride or attending an art exhibition, Austin suggests.

Weighing up convenience, health and cost

Austin also says that cooking from scratch is usually cheaper than buying pre-prepared supermarket food. However, we should be realistic about weighing up the time and cost savings.

“There’s degrees of savings,” she says. “Partly processed foods – like microwaveable rice cups – can be cheaper than restaurants or takeaway. There’s convenience in rice in cups. It’s cheaper than buying lunch but more expensive than buying by the kilo and making it from scratch.”

Austin suggests buying time-saving pre-packaged meals at the supermarket when they’re on special, and buying in bulk when non-perishables like canned tomatoes or corn discounted.

“It’s also OK to use frozen veggies,” says Austin. “When fresh corn is expensive I buy frozen.”

Does meal-planning really save money?

That said, there’s little point buying food at all if we’re only going to throw it out.

According to the United Nations, consumers in wealthy countries waste almost as much food each year (222 million tonnes) as the entire net food production of sub-Saharan Africa (230 million tonnes).

Figures from Foodwise show Australians discard around 20 per cent of the food they buy, which equates to $1,036 per year per household. By eliminating this waste, we can immediately make a major cost saving.

That’s where the Instagram trend of meal-planning comes in.

Meal-prep fans say it not only saves money, but also dramatically reduces food waste and helps the environment.

Addicts snap pics of their beautifully arranged food in matching freezable containers and compare savings.

“We have way too much food waste,” Austin says. “Make a bigger batch of something using all the fresh ingredients and freeze it or share with people. Look at ways to reduce waste – put leftovers into muffins or frittatas, or make a stock.”

Should you go vegan or vegetarian to save money?

Meats and fish can be very expensive. But rather than turning fully vegan or vegetarian, Austin recommends looking at portion control and limiting the number of times you eat meat a week.

“You can make a curry or stir-fry go further by reducing meat and adding more veg and legumes like chickpeas.”

Austin also cautions against buying speciality vegan products like vegan meat and cheese substitutes.

These products can be quite costly and they’re not always good for us. A similar phenomenon occurs with gluten-free foods, with gluten-free products like biscuits costing more and not actually always being a healthier choice.

She recommends that you only buy these products if you really need to.

“Vegan doesn’t necessarily equate with healthier. A bowl of pasta with tomatoes is vegan, but not a well-balanced meal,” Austin says. “But if you replace meat with lentils and legumes it can help with the budget and make it healthy.”

Eat for season, not for fashion

Austin says another key to eating healthily and cheaply is to base our diet around what’s in season and cheap.

For instance, avocados out of season are very expensive and the price of bananas can change depending on weather events. She also warns shoppers to keep away from food fads.

“Kale was expensive when it was a superfood, but you could have bought silverbeets or spinach cheaper, for a similar result,” explains Austin. “You need to be flexible.”

Another rule of thumb is that processing adds to the price and is generally less healthy.

“Rather than putting packaged snacks in lunch boxes try to prepare those things yourself from scratch,” says Austin. “Instead of buying the cheese and biscuits in a packet, cut the cheese from a large block and add some biscuits yourself.”

Austin says that what you make yourself and eat from home will generally be healthier, lower in salt and poor quality fats, and cheaper.

The real cost of an ethical diet

Another diet that could actually end up costing you money is one that’s based on ethical or sustainable principles.

A quick glance at the supermarket shelves shows that most – if not all – products that are ethically produced will cost you a little more. In Australia, you can expect to pay at least a 20 per cent premium for choosing organic.

While the jury is out on their health benefits, organic or bio-dynamic dairy products are generally considered better for the environment.

Consuming these products is essentially a lifestyle choice rather than a financial one. But it may be worth it in the bigger scheme of things.

Many consumers feel good about making ethical dietary choices, and don’t mind paying extra for it.

For example, a 2014 Choice survey found that 68 per cent of those who purchased free-range eggs did so for animal welfare reasons.

And another 67 per cent of those surveyed said that they would prefer to pay more for free-range eggs that are guaranteed to have an appropriate stocking density.

Choosing Australian-grown food to reduce your carbon footprint and avoid shipping miles can also cost you. Foods like dried apricots, nuts, tinned legumes and tinned tomatoes are a case in point, as they often cost more than their imported equivalents.

But for many shoppers supporting local business and Aussie farmers is more important.

Diet savers

The key message is to take a flexible approach to food: buy on special, buy in season, cook at home from scratch, use less meat, and minimise waste.

That way you’ll get more out of the money you’re spending on food and if you could also become healthier in the process.

Austin’s actions

Simone Austin offers these final tips for budget-conscious eaters to keep in mind when making dietary choices:

● Pre-planning is key to saving money and eating well.
● Buy seasonal foods in season, or substitute what is in season if you’re cooking from a recipe – compromise and improvise.
● Shop on the outer edge of the supermarket first where the fresh produce is.
● Know when it’s a good time to shop, for example, markets often have sales at the end of the day.
● Get to know your local butcher or greengrocer.
● Scope out the supermarket specials.
● Speciality stores often have cheaper products you can buy in bulk and share with someone (e.g. mangoes by the box).
● Grow some herbs at home to save paying $3-$4 when you only need a pinch and remember you can freeze them and then use them in recipes when you need them.
● If you grow your own vegetables, share and swap.
● Get kids to bake at home and use leftover food in cooking.
● Spend on what you really like e.g. six dollars on a punnet of berries is still better than buying a cake.
● Invest in good produce that makes you want to eat at home – even if it’s an expensive item it will usually be cheaper than eating out.
● Always use water from the tap rather than buying bottled – it’s safe, cheap and good for the environment.

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