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Housing and transportation may be the top line items in a typical family budget, but the cost of meals and groceries can also be significant. In fact, food prices increased 8.5% between March 2022 and March 2023, according to the Bureau of Labor Statistics’ most recent Consumer Price index report. While all consumers are impacted by price hikes, families in particular may be feeling the pinch at checkout.

If you have a larger family, creating a budget can help keep you from overspending at the grocery store. But how much should you allocate for food each month? Keep reading to learn more about creating a grocery budget for a family of five.

Average Grocery Budget for American Family of Five

When coming up with your grocery budget, it helps to first understand how much you can expect to spend on food. The average household spends roughly $438 per month or $5,259 per year, on at-home food, according to the most recent statistics available from the Bureau of Labor Statistics.

But how much should you budget for groceries if you have a family of five? A good starting point is the USDA’s food plans, which include four spending levels: thrifty, low-cost, moderate-cost, and liberal. According to the latest food plan available, here’s what a family of five should plan to spend on groceries:

How Much to Budget for Groceries Per Person

How much a family of five end up budgeting for groceries depends on a number of factors, like how much the store charges, the type and amount of food purchased, and whether they use a grocery delivery service.

Want to figure out how much to allocate in your food budget for each family member? You can refer to the USDA food plans above for a general idea of monthly and yearly costs, and divide the amounts by the number of members of your family. You can also look at the last three to six months of your family’s grocery bills and calculate a monthly average. Divide that amount by the number of members of your family.

Once you see how much you’re actually spending per person each month, you can adjust your budget accordingly.

How to Prioritize Your Grocery Spending

When you’re feeding a large family, you want to make the most of your grocery list. The best way to prioritize your food spending is to create a monthly budget and stick to it. Having a plan in place makes it easier to curb grocery store splurges.

If you’re new to budgeting, you may want to use the 50/30/20 rule. This framework calls for earmarking 50% of your monthly after-tax income on things you need (such as food, housing, and transportation), 30% on things you want (such as a new outfit or tickets to a concert), and 20% on savings and debt repayment.

Another helpful tool to consider is a budget planner app, which allows you to easily set spending and savings goals and monitor your progress.

How to Stay Within Your Grocery Budget

Staying on top of a grocery budget can be challenging, especially when you have a larger family. The following tips can help:

Don’t Shop When You’re Hungry

When your stomach is grumbling in the middle of the grocery store, chances are you’re more likely to give in to cravings. This may leave you with a cart full of impulse buys, which could add to your overall cost.

Make a Shopping List

Writing down everything you need before you start shopping is a good way to ensure you only pick up the items you need and are in your budget.

Embrace Meal Planning

Create a weekly menu ahead of time so that when you hit the store, you know exactly what ingredients to buy. If your finances allow, consider reserving a small chunk of the budget so that each family member can pick out a treat for that week.

Recommended: How to Create a Budget in 6 Steps

How to Budget for Restaurants and Dining Out

While eating at home can be more cost effective than dining out, many memories are made at restaurants. If your family is planning to have meals out, how much should you expect to spend?

The average American household spends $3,030 on dining out, according to the most recent data available from the Bureau of Labor Statistics. However, larger families should expect to spend more.

Tips for Reducing Your Grocery Budget

Looking to lower your grocery bill? Consider these simple strategies:

•   Buy in bulk

•   Shop at discount retailers

•   Choose generic brands

•   Meal prep for the week

•   Shop sales

•   Join rewards programs

•   Use coupons

•   Use a credit card that earns cash back rewards

Tips for Getting Help If You Can’t Afford to Buy Groceries

Families that are struggling to pay for food have several government resources they can turn to for help. Food stamps (also referred to as SNAP benefits), the WIC program, school meal programs, and food assistance programs are all worth looking into. Depending on the program, you may need to meet certain criteria, such as an income limit, in order to be eligible.

Examples of the Cost of Common Groceries

As anyone who has stepped foot in a grocery store lately can attest, food costs are going up. But just how much depends largely on where you live. Still, it can be helpful to understand national prices so you can prepare your food budget accordingly. Below is the national average of six common items, according to an NBC News analysis of NielsenIQ data.

How to Stretch Your Grocery Budget

Stretching a grocery budget requires careful planning. A few places to start: planning meals for the week, taking advantage of weekly ads and local deals, and shopping at more affordable grocery stores. Savvy shoppers can even design meals around the discounts and coupons being offered at the more affordable grocery stores.

Another strategy is to buy in bulk where it makes sense. Purchasing larger amounts of staples like rice, flour, and paper products can provide a better bang for your grocery buck.

Recommended: Free Credit Score Monitoring

The Takeaway

Food is a major expense for most Americans, but perhaps more so for larger families. Creating a budget can help keep costs in check. On average, a family of five spends anywhere from $922 to $1,488 a month on groceries, according to USDA monthly food plans. If you’re looking to curb your spending, consider meal planning, buying in bulk, and shopping at more affordable grocery stores. If you need help paying for groceries, government programs like SNAP benefits and WIC can provide support.

To make budgeting for groceries and other expenses easier, consider using a money tracker app. The SoFi app connects all of your accounts in one convenient dashboard. From there, you can see all of your balances, spending breakdowns, and credit score monitoring, plus you can get other valuable financial insights.

FAQ

What is a realistic grocery budget for a family of five?

Depending on how much you have to spend on food, a realistic grocery budget for a family of five may range anywhere from $922 to $1,488 a month on groceries, according to USDA monthly food plans. To determine how much your family should spend each month, consider adding up the last three to six months of grocery bills and finding the monthly average.

How can a family of five save money on groceries?

There are steps a family of five can take to save on groceries, including meal planning, taking advantage of coupons and weekly deals, and making a shopping list ahead of time. Those strategies allow families to spend more mindfully and, ideally, lower their grocery bill.

What is a reasonable grocery budget?

The average American household spends $5,259 per year on groceries, according to the most recent statistics available from the Bureau of Labor Statistics.

Photo credit: iStock/seb_ra

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*Terms and conditions apply. This offer is only available to new SoFi users without existing SoFi accounts. It is non-transferable. One offer per person. To receive the rewards points offer, you must successfully complete setting up Credit Score Monitoring. Rewards points may only be redeemed towards active SoFi accounts, such as your SoFi Checking or Savings account, subject to program terms that may be found here: SoFi Member Rewards Terms and Conditions. SoFi reserves the right to modify or discontinue this offer at any time without notice.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Non affiliation: SoFi isn’t affiliated with any of the companies highlighted in this article.

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Inflation is the steady increase in prices and decrease in purchasing power over time. The inflation rate can be calculated using formulas that rely either on the Consumer Price Index (CPI) or Gross Domestic Product (GDP). However, the causes of inflation, and finding the right fiscal policies to manage it, cannot be solved with a formula.

Let’s take a closer look at what the inflation rate is, possible reasons why prices change, and the different ways to calculate the inflation rate.

What Is the Inflation Rate?

Ever notice how things don’t get cheaper over time? Take the cost of bread as an example. The average price of a loaf has steadily risen from around $1.40 in 2013 to $1.94 in 2023. That’s because of inflation, or the increase in the price of goods and services and the decrease in purchasing power over a period of time. This means your dollar may not go as far as it did in the past, though there are ways to protect your money from inflation.

When people talk about inflation rate, they’re referring to a measurement of how much prices have increased over a period of time. Cost increases can vary across product categories, and certain states may be impacted more by inflation.

What Causes Inflation?

There are a few common causes of inflation. The first is when demand for a product is greater than the supply, which is often referred to as “demand-pull” inflation. This can happen when the government or Federal Reserve adds funds to the money supply or lowers interest rates, often in an attempt to combat higher unemployment and stimulate economic growth. It can also occur when consumers have more disposable income and are more economically stable.

The second main cause of inflation is when the cost of producing a product increases, and as a result, businesses must raise their prices. This is called “cost-push” inflation.

A third common cause of rising prices is “built-in” inflation. That’s when companies give workers a bump in pay to keep up with rising living costs, and then in turn raise the prices of their products to help offset those costs.

When inflation hits, tools like a spending app can help you keep your finances in order.

Recommended: How to Invest During Inflation

What Is the Consumer Price Index?

The Consumer Price Index (CPI) tracks and measures the average change in prices for 80,000 or so commonly purchased goods and services. Those items fall into eight major categories: food and beverage, recreation, apparel, transportation, housing, medical care, education and communication, and various services. Social Security taxes, income taxes, or the purchase of investments are not included.

Each month, the U.S. Bureau of Labor Statistics calculates and publishes the CPI. Economists, policymakers, businesses, and consumers follow the findings closely, as the index is a popular measure of inflation. The data is also used to determine cost-of-living adjustments for federal benefit payments.

How to Use CPI to Calculate the Inflation Rate

If you want to calculate the inflation rate for a certain period, you’ll first need to decide what goods you are going to examine. You can use CPI charts to gather the historical price information for those goods. Keep in mind that the index measures the average of the price of the goods or services over a stretch of time.

You’ll also want to decide what time frame you’d like to examine. Do you want to know the rate of inflation for the past five or 10 years? Or are you estimating the inflation rate for a future period?

Once you’ve collected all your historical price data, organize the information on a spreadsheet. Find the price of your goods at your starting point, and name that price A. Identify the price of your goods at your end point, and name that price B.

Now you can apply the inflation rate formula:

Inflation rate = Price B – Price A / Price A x 100

Your answer is the inflation rate as a percentage.

You can also use the BLS’s CPI Inflation Calculator to see how buying power has changed over the years.

Recommended: 2022 Hourly Wage Inflation Calculator Table

How to Find the Inflation Rate with GDP

Using the CPI is one way to measure changing price levels and inflation. Another way is the Gross Domestic Product (GDP) deflator.

GDP is the sum of the value of all goods and services produced and sold by a country in a specific period of time, usually a quarter or year. It’s considered an indicator of a nation’s economic strength because it shows what is being produced and sold.

Unlike the CPI, the GDP deflator measures the change in prices in the economy as a whole, including goods and services, government spending, and exported goods. It provides a more comprehensive measure of inflation.

To find out how much prices have changed over a period of time, you’ll need two pieces of information: the nominal GDP (the value of goods and services produced at current market prices) and the real GDP (the value of goods and services produced at inflation-adjusted prices). The Bureau of Economic Analysis updates and publishes this information on a quarterly basis.

Here’s the formula you’ll use:

GDP deflator = (Nominal GDP / Real GDP) × 100

The answer is the rate of inflation in terms of GDP.

The Takeaway

From the growing cost of education to rising mortgage rates, inflation can impact consumers on a number of fronts. Inflation commonly occurs when demand for a product outstrips supply, businesses increase their prices to cover rising costs of production, or companies raise their prices to cover cost of living wage increases. The inflation rate measures how much prices have risen over a period of time and is calculated by examining the change in prices of certain consumer goods and services over a period of time. The CPI is generally the metric used to calculate the inflation rate, but some economists prefer to use the GDP deflator because it takes more data into account.

When prices start to rise, it can be a smart idea to keep a closer eye on your finances. A money tracker app can help. The SoFi app connects all of your accounts in one convenient mobile dashboard. From there, you can keep tabs on your balances, spending breakdowns, and credit score monitoring. Plus, you can get other valuable insights.

FAQ

What is inflation?

Inflation is the increase in the prices of goods and services and the decrease in purchasing power over time. This means your dollar will not go as far as it did yesterday.

How do you calculate the inflation rate?

To calculate the inflation rate using the Consumer Price Index, first collect the price data for the period you are studying. Find the price of your goods at the beginning of your period (Price A) and at the end (Price B). Next apply the inflation rate formula, which is Price B – Price A / Price A x 100. Your answer is the inflation rate as a percentage.

What is the current inflation rate?

The U.S. inflation rate was 6.4% for the 12 months ended January 2023, according to the U.S. Department of Labor. In 2022 at the same time, it was 7.5%, and in 2021 it was 1.4%.

Photo credit: iStock/marchmeena29

SoFi Relay offers users the ability to connect both SoFi accounts and external accounts using Plaid, Inc.’s service. When you use the service to connect an account, you authorize SoFi to obtain account information from any external accounts as set forth in SoFi’s Terms of Use. Based on your consent SoFi will also automatically provide some financial data received from the credit bureau for your visibility, without the need of you connecting additional accounts. SoFi assumes no responsibility for the timeliness, accuracy, deletion, non-delivery or failure to store any user data, loss of user data, communications, or personalization settings. You shall confirm the accuracy of Plaid data through sources independent of SoFi. The credit score is a VantageScore® based on TransUnion® (the “Processing Agent”) data.

*Terms and conditions apply. This offer is only available to new SoFi users without existing SoFi accounts. It is non-transferable. One offer per person. To receive the rewards points offer, you must successfully complete setting up Credit Score Monitoring. Rewards points may only be redeemed towards active SoFi accounts, such as your SoFi Checking or Savings account, subject to program terms that may be found here: SoFi Member Rewards Terms and Conditions. SoFi reserves the right to modify or discontinue this offer at any time without notice.

Non affiliation: SoFi isn’t affiliated with any of the companies highlighted in this article.

External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

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Your house is much more than a home — it’s likely one of the biggest purchases you’ll ever make, with a value that makes up a significant proportion of most people’s net worth. As such, you’ve probably wondered from time to time what your home is worth.

Determining the answer is not as simple as referring back to your sales agreement or mortgage papers. What you paid for your house when you purchased it merely reflects what your house was worth to you — and the real estate market — at a specific point in time.

In reality, housing values are dynamic, and they fluctuate based on a number of factors. Some things, such as keeping your house in good repair, are within your control. Other external influences, such as the market, mortgage rates, and other considerations, can also affect the value of your home.

Here, we’ll take a close look at how this works, and answer questions like:

•   How much is my house worth?

•   What factors determine my home’s value?

•   How can I increase my home’s value?

First, take our “how much is my house worth” quiz to get an overview of what value your home holds.

Next, delve into the topic more deeply with these insights.

Estimating the Value of Your House

Knowing how much your house is worth can improve your money mindset by helping you understand where you are financially. There are a number of ways you can determine the estimated value of your house.

•   Online calculators. The easiest and fastest way to answer the question, “How much is my house worth?” is probably to use an online home valuation calculator. These tools provide a ballpark estimate of the value of your home based on your address. Such estimates typically use publicly available information, including average home sale prices in your area, property tax assessment information, market trends, and other data.

•   Market dynamics. Once you have a rough estimate of your property’s worth, you can use other cues about the housing market in your area to gain more insight. This might include such factors as sales and mortgage trends, which can give you a sense of whether your property value is likely to increase, decrease, or remain stable. For instance, during times of rising mortgage interest rates, consumer demand might wane as it becomes more expensive to borrow money.

•   Professional opinions. A professional appraiser or real estate agent can also help you get a more precise estimate of what your house is worth. An appraiser will consider both the local housing market and the unique characteristics of your property when creating your home appraisal.

Real estate agents, meanwhile, will typically conduct a comparative market analysis (also called a comp or CMA). This is an estimate based on actual data from recently sold homes that are most similar to yours.

If you are looking to sell, you may want to consider getting a comparative market analysis from several different real estate agents to help you assess their knowledge of and viewpoint on the local market before you commit to one. Understanding the various criteria real estate agents use to determine listing prices can also help you to get an accurate picture of what your house is worth.

Recommended: What Hurts a Home Appraisal?

A Home’s Worth: 3 Factors to Consider

Every house is unique — but the factors used to determine property value are fairly consistent.

1. Neighborhood: There’s a good reason why “location, location, location” is one of the most popular mantras in real estate. The same home, in the exact same condition, will fetch different prices depending on where it is. Proximity to desirable schools, shopping, public transportation, and other resources and infrastructure can increase the desirability of a neighborhood and thus the value of the home. Safety considerations, such as crime rates, sidewalks, and traffic signals, can also impact house values.
2. House specifications: Attributes such as the size of your lot, square footage, age of your home, number of bedrooms and bathrooms, parking space, and updated mechanical systems are among the criteria buyers will typically consider. Agents may factor these in while developing a comparative marketing analysis.

Also, the style of your house and the amenities can matter. Does it have a fabulous family room, a spa-style bathroom, skylights, or a pool? That can lift the value.

3. House condition: Well-maintained houses with high curb appeal can typically fetch better prices than run-down fixer-uppers. As such, your home’s condition is probably the most easily controlled aspect of its value.

To evaluate the condition of your home, take stock of any repairs, both major and superficial; any upgrades such as premium kitchen appliances; and any renovations you may have performed.

There are additional factors outside of your control that will affect the value of your home — though these may be less significant if you are not imminently considering selling.

For example, the state of the economy and mortgage rates may dictate others’ appetite for real estate purchases, as well as how much they are willing to spend. At press time, mortgage interest rates were rising in an effort to offset inflation’s impact on consumers. This can cause a softening of the housing market, or a lowering of prices, since it’s more expensive to borrow money.

Seasonal fluctuations such as holidays and weather can also affect home purchasing patterns. In addition, spring has often been looked at as the prime selling season, when families hope to find a new home and get settled before the start of the next school year.

Recommended: Should I Sell My House Now or Wait?

Increasing the Value of Your Home

Though there are some factors that may be out of your control (such as inflation and its impact), there are things you can do to increase the value of your home. If you are considering selling soon, staging your house or making small improvements, such as tidying your garden, can go a long way towards appealing to buyers — without a big financial investment.

But if you are considering investing in renovations and upgrades, it is helpful to know which will deliver the greatest returns. An online calculator can compare different projects to determine how various home improvements impact your home’s value. You might be able to finance such improvements with a home equity line of credit (or HELOC).

Recommended: Does Net Worth Include Home Equity?

Why Your Home Value Matters

If you are considering selling your house, “How much is my home worth?” is likely one of the first things you’ll wonder about. But even if a move isn’t something you are considering right now, there are other reasons why it might be important to know the actual value of your home.

•   Relocation plans. For those considering relocating, getting a reliable estimate of how much your house is worth will inform the amount you can afford to spend on your next home. As taxes, real estate agent commissions, and some other fees will be based on the actual sale price of your house, this valuation will also help you to estimate some of your moving costs.

•   Financial planning. Even if you aren’t planning to move, it can be wise to know your house’s value for another reason. As one of the greatest assets in many people’s financial portfolios, your home’s worth can play a helpful role in guiding long-term money planning, including retirement and estate planning.

If these things seem a long way off, there are immediate benefits to being informed about your home’s worth, too.

•   Property taxes. Your property tax bill is based on the market value of your house and may change from year to year, based on your municipality’s estimate of its worth as determined by a government assessor. A reliable estimate of how much your house is worth can help you to identify discrepancies in the assessed value. If you believe there is an error, you can file an appeal in an attempt to get your property tax bill reduced.

•   Homeowners insurance. Having an accurate estimate of the value of your home is also important for obtaining appropriate insurance coverage. If your estimate is too low relative to the actual value of your home, you run the risk of being underinsured in the event of a claim. Too high, and you’re paying for coverage you don’t need.

•   Equity considerations. Your home’s value can also help you to access money to pay for home improvements, a financial emergency, or other needs that may arise. If the current value of your home is more than it was at the time you purchased it, you may be able to tap into that increased value with, say, a HELOC or cash-out mortgage refinance.

Home Improvements and Your Mortgage

Even if you’re not looking to sell, adding value to your home may result in savings in the near term. This can be especially true for those who are paying private mortgage insurance (PMI).

•   Typically, buyers who purchase a home with less than 20% down are required to pay for PMI — a fee that is based on a percentage of your total mortgage.

•   The amount of equity in your home can be determined by subtracting what you owe on your house (or your mortgage principal) from the current total value of your home. If your property value has increased, you have more equity than when you purchased your home.

•   If the increase in your property value brings your equity over the 20% threshold, you can ask your mortgage loan servicer to cancel the PMI. That, in turn, will save your money every month.

The Takeaway

Understanding how much your house is worth is an important fact. Your house is a major investment, and knowing its current value can help you in a variety of ways, whether or not you are planning on selling it. Even if you are staying put, knowing its worth could help you make sure your insurance is keeping pace with its price, open the door to a home equity loan, or perhaps lower an assessment.

If you’re ready to find out your property’s value, SoFi’s money tracker app can help. Our property tracking tool can help you learn your home’s worth. It can help you know when more insurance is needed, how much renovations would cost and financing options, and what you might be able to save by refinancing your loan.

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Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

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SoFi Relay offers users the ability to connect both SoFi accounts and external accounts using Plaid, Inc.’s service. When you use the service to connect an account, you authorize SoFi to obtain account information from any external accounts as set forth in SoFi’s Terms of Use. Based on your consent SoFi will also automatically provide some financial data received from the credit bureau for your visibility, without the need of you connecting additional accounts. SoFi assumes no responsibility for the timeliness, accuracy, deletion, non-delivery or failure to store any user data, loss of user data, communications, or personalization settings. You shall confirm the accuracy of Plaid data through sources independent of SoFi. The credit score is a VantageScore® based on TransUnion® (the “Processing Agent”) data.

External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

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When it comes to maintaining a strong financial plan and healthy financial behaviors, our brains can sometimes work against us. Behavioral biases, mental traps, and neural wirings can all get in the way of setting and meeting financial goals.

Consider recency bias, which is the tendency for people to look to recent events to make decisions about the future. Just because a stock has skyrocketed recently, that doesn’t mean its upward trajectory will last forever. In fact, jumping into the market during a rally could mean you end up buying when prices are high, right before investors bail and prices fall.

Another mental tendency to consider: ego depletion. It’s the idea that people can only exert their willpower for a limited time, and after that, it’s harder to practice self-control. If you have an important financial decision to make, it may make sense to wait until you are no longer feeling depleted.

Here’s a closer look into the ego depletion theory, what it could mean for your finances, and how to overcome it.

What Is Ego Depletion?

The concept of ego depletion hinges on the idea that our willpower reserves are finite, and when we exert self-control for too long, we use up those reserves. Once those are depleted, it is harder to exert self-control, and we’re more likely to make poor decisions.

The term was coined by American social psychologist Roy Baumeister in the late 1990s, though the idea of ego depletion has become popular in recent years. This may be in part because it makes sense intuitively. For example, the experience of eating a healthy breakfast and lunch only to get home from work and eat a bag of chips for dinner is pretty easy to relate to.

However, not everyone agrees with the concept of ego depletion. Some scientists report a lack of consistent data to support the idea. Instead, they have found that motivation is not finite. Rather, it can be subjective, and there are ways to increase it. That can be a good thing as you begin to set long-term financial goals.

Causes of Ego Depletion

There are a variety of factors that may play a role in ego depletion.

•   Low blood sugar. If you haven’t eaten and your blood sugar has dropped, it may be more difficult to exert willpower.

•   Emotional distress. Temptations may be harder to resist if you’re experiencing a state of mental anguish.

•   Unfamiliar tasks. If you are doing something for the first time, you may need to exert more mental energy, which can lead to ego depletion.

•   Lack of choice. If you are forced to do a task not of your choosing, you may be more likely to become depleted.

•   Illusory fatigue. If you think that a task will be mentally tiring, you may experience ego depletion faster. In other words, ego depletion happens more often when you expect it to. If you think a task won’t tax you too much, you may be able to exert more self-control.

•   Cognitive dissonance. Situations in which you do or say something that contradicts your beliefs can tire you out and diminish your self-control.

•   Variable heart rate. Those who experience variable heart rate have been found to have less self-control.

The Effect of Ego Depletion on Your Finances

If tasks that require self-control weaken your willpower, you may be less likely to make good decisions when you experience ego fatigue. When it comes to your finances, for instance, you may be more likely to spend money on things that you can’t afford.

Ego depletion could also mean you’re less equipped to make important decisions, such as how to invest your money. For example, if the market is experiencing a downturn, you may find yourself more prone to panicking and potentially pulling out your money. But in doing so, you’ll lock in losses and potentially miss out on a subsequent upswing.

Ego depletion could also mean you miss important deadlines, such as deadlines for funding your 401(k) or IRAs, or tax deadlines.

Recommended: Key Terms to Improve Your Financial Literacy

How to Overcome Ego Depletion

Luckily, there are ways to overcome ego depletion and improve your money mindset.

Get Enough Sleep

Lack of sleep makes self-control difficult. Sleep counteracts fatigue and helps reset your willpower reserves, so practice good sleep hygiene. Go to bed at a consistent time. Make sure your bedroom is quiet, relaxing, and dark. Avoid large meals, caffeine, and alcohol before bed.

Manage Stress

Managing stress can help you address the causes of ego depletion as well as its effects. Consider strategies such as deep breathing, mindfulness exercises, eating healthy, and consistent exercise.

Set Goals

Clear financial objectives and the steps you need to reach them can help overcome ego depletion. Consider using SMART goals, or goals that are specific, measurable, achievable, relevant, and time-bound. With these in place, you’ll know what you need to do to accomplish your objectives, and you’ll also be less likely to make moves that stray from your plan.

Plan for the Long Term

Long-term financial plans take your goals, risk tolerance and time horizon into consideration. They are built to account for the natural cycles of volatility. With a long-term plan to refer to, you may be less likely to make rash decisions in the short term, such as panic selling when markets are down or buying when market prices are peaking and may be nearing a fall.

Recommended: Guide to Money Affirmations

Tools to Help Your Reach Your Goals

There are a variety of tools out there that can help you set and meet your goals and make financial freedom a reality. It’s worth shopping around to find the ones that work best for you and you’re more likely to stick with.

One to consider: a spending app, which can help you set up a budget, categorize and track spending, make bill payments on time, and track your credit score.

The Takeaway

The idea of ego depletion centers around the idea that when we exert self-control for too long, we use up our willpower reserves and are more likely to make poor decisions. Learning the causes of ego depletion is a first step in helping you head off rash financial decisions that may work against you. If you recognize that your willpower is fading, take a breather. And when in doubt, refer back to your long-term financial goals and plan.

If you’re looking to build your long-term financial plan, a money tracker app can help. The SoFi app connects all of your accounts in one convenient dashboard. From there, you can see all of your balances, spending breakdowns, and credit score monitoring. Plus, you can get other valuable financial insights.

Stay up to date on your finances by seeing exactly how your money comes and goes.

FAQ

What is the cause of ego depletion?

Ego depletion can be caused by a number of factors, such as emotional distress, fatigue, low blood sugar, or unfamiliar tasks.

What is an example of ego depletion?

An example of ego depletion might be spending the day hard at work and then coming home, sitting on the couch, and turning on the television instead of pursuing other healthier activities, such as going to the gym.

How do you deal with ego depletion?

There are a number of strategies to combat ego depletion, such as getting enough rest, managing stress, and setting and sticking to long-term goals.

Photo credit: iStock/Delmaine Donson

SoFi Relay offers users the ability to connect both SoFi accounts and external accounts using Plaid, Inc.’s service. When you use the service to connect an account, you authorize SoFi to obtain account information from any external accounts as set forth in SoFi’s Terms of Use. Based on your consent SoFi will also automatically provide some financial data received from the credit bureau for your visibility, without the need of you connecting additional accounts. SoFi assumes no responsibility for the timeliness, accuracy, deletion, non-delivery or failure to store any user data, loss of user data, communications, or personalization settings. You shall confirm the accuracy of Plaid data through sources independent of SoFi. The credit score is a VantageScore® based on TransUnion® (the “Processing Agent”) data.

*Terms and conditions apply. This offer is only available to new SoFi users without existing SoFi accounts. It is non-transferable. One offer per person. To receive the rewards points offer, you must successfully complete setting up Credit Score Monitoring. Rewards points may only be redeemed towards active SoFi accounts, such as your SoFi Checking or Savings account, subject to program terms that may be found here: SoFi Member Rewards Terms and Conditions. SoFi reserves the right to modify or discontinue this offer at any time without notice.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

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Understanding the average salary of a profession can help you make a variety of important decisions, from what field you want to enter to where you want to live and work. In California, the average physician makes more than $200,000 per year. Knowing that, medical students have a better idea of what they could make when they get out of school. Likewise, physicians looking to relocate to a new state have a better sense of how their salary can change based on where they decide to move.

Here’s a closer look at how much medical doctors make a year in California, regional differences in salary, and the top-paying medical specialities in the state.

What Is the Average Salary for a Medical Doctor in California?

The average salary of a physician in the state of California is $229,420 per year, according to data from the U.S. Bureau of Labor Statistics (BLS). This figure doesn’t account for a physician sign on bonus, which some doctors receive. Interestingly, California is squarely in the middle when it comes to average physicians’ salaries, along with Oregon, Texas, Maryland, and New York. The average salary in California lags more than half of states, including Arizona, Florida, Wyoming, Kentucky, and South Carolina.

Though many consider anything more than $100,000 a good salary, California’s relatively low pay may come as a surprise to some. However, there are some possible explanations. For one, California spends the most on Medicaid among U.S. states. Medicaid — and Medicare, for that matter — both reimburse physicians at rates lower than their usual fees. Doctors who are seeing a lot of elderly or low-income individuals may see their incomes reduced.

Note that early in your career as a doctor, while you’re in your residency or fellowship, you’ll likely make considerably less than you will later in your career. Explore ways to get by on a medical resident’s salary.

You may also want to consider using a spending app, which can help you set financial goals and a budget and track where your money goes.

Recommended: Budgeting as a New Doctor

How to Become a Doctor in California

Doctors are health care professionals who are charged with meeting with patients, diagnosing their conditions, and managing their care plans. They perform tests and prescribe medications. And they must coordinate with a range of other health care professionals, including other doctors, nurses, and emergency medical technicians.
That’s a lot of responsibility, and as a result, it takes a lot of training to become a doctor.

First, you’ll need to complete a bachelor’s degree in a field that relates to medicine, such as pre medicine, biology, or biochemistry.

Next, you’ll need to go to medical school, where you will receive classroom and practical training to advance your knowledge in the medical field. Medical school is typically a four-year program. While in school, you’ll complete the first and second parts of the U.S. Medical Licensing Examination (USMLE). The average cost of medical school can be high, running more than $50,000 a year at private institutions.

When you graduate from medical school, you’ll enter a residency program that helps you choose a medical specialty. These programs usually last three years, and under the supervision of an experienced physician, you’ll work full time as a resident doctor. You’ll complete your residency by passing the third and final part of the USMLE.

After your residency, you can choose to complete a fellowship that gives you further training in the specialty you’ve chosen. Though fellows tend to make more than residents, their salary isn’t as high as new doctors. The good news is, there are ways to budget on a medical fellowship salary.

Finally, you’ll need to obtain a California medical license from the Medical Board of California. You can renew your license every two years, which requires 50 hours of continuing medical education.

Recommended: What Is the Average Medical School Debt?

Reasons to Become a Doctor

Becoming a doctor can involve a lot of challenges, but it can also be immensely rewarding work. Here are a few reasons you might become a doctor:

•   To help others: Doctors diagnose and treat medical conditions, helping to save and improve patients’ lives. They are often involved in ongoing treatment, ushering patients down the path to recovery. Being a physician is a people-centric profession that involves working closely with patients and their families to explain medical conditions and treatment options.

•   To work in the sciences: If you’re interested in a variety of scientific fields, from biology to chemistry to anatomy to pharmacology, being a doctor is a way to explore these subjects while also helping others.

•   To find purpose: The responsibility toward patients and coworkers and the ability to better people’s health and well-being often provide doctors with a sense of satisfaction and meaning in their work.

•   To become a teacher: Becoming a doctor requires a lot of schooling and ongoing training. Doctors may pass on this knowledge by educating patients on how to lead healthier lives, educating medical students in teaching hospitals, and supervising residents.

•   To have job security: The job outlook for physicians is relatively low, with the field expected to grow 3% through 2031. That said, there are still 23,800 openings for physicians projected each year, according to BLS data.

•   To make a good salary: The annual average wage for all workers in the United States is $58,260, according to the BLS — quite a bit lower than the $229,420 average annual pay for physicians in California.

Best-Paying Medical Doctor Jobs in California

The medical speciality you pursue in California will have a big impact on your salary. According to BLS data, here are some of the highest-paid physicians in California:

Psychiatrist

Psychiatrists help diagnose and treat mental disorders. Unlike psychologists, they are allowed to prescribe drugs for medical treatment.

Average salary: $305,290

Obstetricians and Gynecologists

OBGYNs provide medical care related to childbirth and diagnose and treat diseases of the female reproductive organs. They also specialize in women’s health issues like hormone problems, infertility, and menopause.

Average salary: $309,610

Anesthesiologist

Before, during, or after surgery, anesthesiologists administer anesthetics (which reduce sensitivity to pain) and analgesics (which act as pain relievers).

Average salary: $318,030

Cardiologists

Cardiologists diagnose and treat conditions of the cardiovascular system.

Average salary: $343,370

Radiologists

Radiologists use medical imaging techniques, such as x-rays, MRIs, and ultrasounds to diagnose and treat diseases and injuries.

Average salary: $345,100

Pathologists

A pathologist helps diagnose diseases by running tests on organs, tissue, and bodily fluids, such as blood.

Average salary: $350,980

Surgeons

Surgeons are medical doctors that may have to perform surgery, a procedure that physically changes a patient’s body.

Average salary: $351,580

Recommended: Starting (and Keeping) an Emergency Fund

The Takeaway

Being a doctor can be fulfilling, as it allows you to help people through work in the medical sciences. It can also be monetarily rewarding, and understanding average salaries can help you make decisions about where you want to live and what you want to specialize in. Though income varies by speciality, the average salary for physicians in California is $229,420 per year.

As you build your practice and earn a salary, a money tracker app can help you get your financial house in order. The SoFi app connects all of your accounts in one convenient dashboard. From there, you can see all of your balances, spending breakdowns, and credit score monitoring, plus you can get other valuable financial insights.

Stay up to date on your finances by seeing exactly how your money comes and goes.

FAQ

What is a doctor’s yearly salary in California?

In California, a doctor can expect to make $229,420 per year on average, according to data from the U.S. Bureau of Labor Statistics.

What is the highest-paying medical specialty?

Among the highest-paid doctors in California are pathologists, surgeons, and radiologists.

Who earns more: a dentist or a doctor?

In California, doctors tend to make more than dentists, who earn ​​$165,950 per year on average.

Photo credit: iStock/Drazen Zigic

SoFi Relay offers users the ability to connect both SoFi accounts and external accounts using Plaid, Inc.’s service. When you use the service to connect an account, you authorize SoFi to obtain account information from any external accounts as set forth in SoFi’s Terms of Use. Based on your consent SoFi will also automatically provide some financial data received from the credit bureau for your visibility, without the need of you connecting additional accounts. SoFi assumes no responsibility for the timeliness, accuracy, deletion, non-delivery or failure to store any user data, loss of user data, communications, or personalization settings. You shall confirm the accuracy of Plaid data through sources independent of SoFi. The credit score is a VantageScore® based on TransUnion® (the “Processing Agent”) data.

*Terms and conditions apply. This offer is only available to new SoFi users without existing SoFi accounts. It is non-transferable. One offer per person. To receive the rewards points offer, you must successfully complete setting up Credit Score Monitoring. Rewards points may only be redeemed towards active SoFi accounts, such as your SoFi Checking or Savings account, subject to program terms that may be found here: SoFi Member Rewards Terms and Conditions. SoFi reserves the right to modify or discontinue this offer at any time without notice.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Non affiliation: SoFi isn’t affiliated with any of the companies highlighted in this article.

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