You can use a budgeting percentage format, or spend 30days writing down everything you spend and then evaluating it against a percentage basis. We use Crown Financial.
Bottom line your grocery budget is going to depend on your monthly income, your family size, your local economy and your desires in quality of food. We spend 14% of my dh's take home pay on groceries and household items per month. For a comparison our mortage is 28% of our income, which is right on track with the standard 30% budget rule which is hard to follow in many housing markets.
I know my df can't get housing for 30% of her monthly income. It's closer to 55% of her monthly income to afford the cheapest apt. That does not leave her much room to spare on groceries, she isn't going to feed her and 3 boys on 14% of her monthly income. It cost her closer to 30% and with no child support she really can't live on what she makes, period. Which is why she is living with us, rent free until child support is enforced -- not sure what we're going to do when the ex goes to jail instead of paying...
We are a family of 2 adults and 3 children, plus I feed a df's 3 boys during the week breakfast, lunch and snacks (which has pushed our food budget). Not to mention our utilities...
I had an alottment of $600/ mo on groceries & household items like vinegar, detergent, EOs, if we need a new mop head, etc. After months of the extra mouths, in addition to a newly dx'd food disorder, I increase it to $700/ mo. I buy organic if I can and I have a Gluten Free child who has specialty items to buy for. I also buy convient items which is less $$ than going out to eat and saves me with all day morning sickness preparing dinner when it's the last thing I want to do after being sick all day, but still more $ than if I had prepared a meal all by myself.
We also buy and butcher a cow 1X per every 18 months. That cost hang weight of the cow at market value (it's free range organic, but we are not charged for organic), plus butchering fee. I want to guess it was about $1200 for the cow and $400 for the butchering, rounding last year. We're getting ready to do it again soon -- time to clean out the convience foods b/c it takes up the entire chest freezer PLUS.
I have a job at home that pays for preschool for 2 and a few extras like new cloth diapers, specialty skin care for me, supplements our household expense budget for buying organic shampoo and conditioner, my sewing habit, etc. I don't earn much, but I stretch it the best I can b/c I don't depend on my dh's income to support my hobbies or other things. I guess we've never budgeted 'play money' for the wife, if I spent less on groceries then I can use the left overs for play -- but that has never happened
... Mostly all our money goes to fixing up the 'fixer upper' and savings.
Good luck with your budget. It's not an easy thing to do b/c sometimes the truth is very hard to swallow, especially if a lot of debt is discovered. Take it one step at a time, seek help if you need it. And above all else, be sure to tell each other you love one another before and ending a budgeting session. $$ is like the #1 reason for divorce in this country.