First Person: Our Plan for Rising Dairy Prices

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We already keep the "food" line of our budget very tight. And with margins razor thin, an extra $20 or even $10 a week at the grocery store can weaken our family finances. So when I read an MSN Money article the other days noting that dairy prices could be on the rise, I felt it was time to take action. The article notes, "Farmers also worried that if a current nine-month extension of the 2008 farm bill expires with no action, a 64-year-old law will kick in, sending milk prices spiraling. While that might provide short-term profits, they say, it'd hurt them in the long run because no one wants to buy milk at $6 a gallon."

After reading this, we took some time to outline steps for our family to take so that if dairy prices as a whole shoot higher, we'll be ready.

Making a big difference with small changes

We already have a very tight food budget. Our family of four typically spends just under $300 a month on food, well under the average per person SNAP (food stamp) allotment. So it wouldn't take much to bust our budget when it comes to higher dairy prices. Therefore, sometimes it's the little changes we can make to our diet that can make a big difference to our budget.

Should milk and dairy prices start shooting upward, things like switching to powdered creamer rather than real milk or real creamer can save us about $1 a week. Eating oatmeal rather than cereal with milk, or having toast with jam or toaster pastries rather than cereal with milk, and drinking juice or water with our meals rather than milk could save us up to an additional $4 a week without completely eliminating diary from our diet. $20 a month might not sound like much, but it's almost 7 percent of a $300 monthly budget.

Downsizing dairy

I've realized that when we have less, we tend to use less. It's kind of like super-sizing a meal at a fast food joint; I still manage to eat everything even though I would have been just as content without the super-sizing.

Therefore, there are simple downsizing tactics we can use when it comes to our dairy consumption that can help us reduce consumption and cut costs in the process.

  • Buying a gallon of milk but splitting it into two ½ gallon containers to better gauge consumption and use less rather than buying two more expensive (per ounce) ½ gallons of milk.
  • Buying less ice cream in favor of frozen fruit or icy pop popsicles.
  • Buying sticks of margarine rather than larger tubs

Simply doing without

With a baby, we need milk; however, there are certain dairy products we can do without. While we like real butter, margarine is tolerable. While we enjoy ice cream, we don't need it. While we like the occasional egg breakfast, we can go without, and while I love homemade milkshakes, even I can pass them up if they'll make for a more affordable trip to the grocery store. Just doing things like not adding extra cheese to our home-baked pizzas or selecting tacos without cheese (or using imitation cheese) in place of quesadillas for dinner can end up reducing our dairy expenditures while maintaining much of our regular meal options.

Therefore, with a little pre-planning and some thinking outside the box, I think we'll be okay if milk and dairy prices start to skyrocket. While it's not something we hope to see, we'd rather be prepared than left overspending at the grocery store.

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The author is not a licensed financial, health or dietary professional. The information provided in this article is for informational purposes only and does not constitute advice of any kind. Any action taken by the reader due to the information provided in this article is solely at the reader's discretion.


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