How Much Does the Average American Spend on Eating Out?

How Much Does the Average American Spend on Eating Out?

Eating out is a great way to spend quality time with the people you love and cut out the hassle of cooking, but it comes with a real price tag premium. Estimates range on the premium itself, as there's a wide range of dining options, but one blog has it at nearly 5x the price.

The Bureau of Labor Statistics estimated in 2022-2023 that the average American spends $3,786 per year on dining out, which translates to approximately $315 per month. However, this figure appears to be rising as a recent survey from Popmenu puts monthly dining out costs at $460 per month, or $5,520 yearly. This is quite expensive, as nearly one-third of Americans can’t afford a $400 emergency. 

This isn’t a call to sit at home and never eat outside of your home, but rather to have a set budget for dining out and be intentional with your money. The WorkMoney team has put together a guide on the financial state of eating out in America, along with tips on how to budget and save for this expense.

The Current State of Eating Out in America

Eating out is a cultural staple in America. The top reasons for someone to dine out are the atmosphere, to socialize, and to celebrate a special occasion. With over 700,000 restaurants and consumers dining out 4-5 times per month and ordering/delivery 3 times per month, this represents not only a necessity, but an enjoyable activity for many. 

However, this luxury can also present a financial hurdle to advancing your financial goals. But you shouldn’t force yourself to stay at home forever to save money forever. Here are a few things you can do to budget for this enjoyable way of getting the food you need.

How to Budget for Eating Out

There are some occasions when you have to eat out, and that’s okay. And, even if you want a break from cooking and want to enjoy a meal out, that’s okay too. Here’s how you can have the best of all of it, while not being financially wasteful.

• Set a percentage rule: In your budget, you can figure in a percentage of your take-home pay for dining out. A general rule could be 5-10%, or a flat amount.

• Create a dining-out fund: At the beginning of the month, you can withdraw the amount you can spend on dining out and stuff it into an envelope. Once you run out of money in that envelope, you can’t dine out again until the beginning of the next month. And there are several ways to manage this, including: having limits on per-meal costs, or having a limit on how many times per week you can dine out.

• Track your spending: If you prefer to keep your money in your checking account, you can track your spending using a budgeting app.

• Plan for special occasions: If you know you enjoy dining out for your birthday, or have upcoming events where you know you’ll be purchasing food out, it could be advantageous to plan ahead and save for those occasions.

Smart Ways to Save on Eating Out

Instead of feeling guilty for eating out, there are solutions to cut down the total expense for doing so. Here are a few ways to dine out without breaking the bank.

• Pick restaurants wisely: Maybe instead of going to a full-service restaurant where you’re being served and are expected to tip, potentially choose a quick-serve restaurant where tipping isn’t expected.

• Look for deals and discounts: Between happy hour discounts, digital coupons through Accessperks, and loyalty apps where brands regularly award discounts and points, you can cut down the cost.

• Minimize the extras: Drinks (alcoholic and non-alcoholic), appetizers, and desserts drive up the bill significantly, and are also some of the higher profit-margin items for restaurants. To avoid this, try to only order an entree.

• Use delivery strategically: Delivery apps notoriously mark up products, and additional fees can raise prices significantly. Check to see if there are any promotions, where sometimes, you can get food even cheaper or delivered for free. If there aren’t, you could find yourself paying $28 for a burrito when it normally costs $12.

• Leverage credit card rewards: You might consider signing up for a cashback credit card that rewards cardholders for dining out.

Conclusion

Eating out is a luxury, but it’s also part of socializing with friends and family, which is important to our mental health. You shouldn’t have to completely cut this part of your life out, but there’s also a way to be financially conscious while you’re out with those you care about.

Do some analysis into how much you’re spending monthly on dining out, and find a number that makes sense for your budget. It’s a luxury, but it shouldn’t be something you’re forced to cut our completely.