What’s The Difference Between Frugal and Cheap?

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Being Frugal or A Cheap-ass
Photo Credit: Wokandapix


It has been said there is a fine line between being frugal and being cheap. Frugalness is perceived as an admirable quality. Cheapness is not. Tell your friends you saved a bunch of money on car insurance by switching to Geico and they’ll all be patting you on your back. Tell your friends you are saving a bunch of money on car insurance because you decided to cancel your policy and everyone will consider you a cheap-ass. Don’t be a cheap-ass.

What is the difference between frugal and cheap and how do you toe the thin line between the two without crossing over to the cheap side?

First of all, there is nothing wrong with being cheap. You are welcome to go through life reusing paper towels by washing them in the sink; refilling your ketchup bottles with ketchup packets from McDonalds; going dumpster diving for discarded food at the grocery store; or a myriad of other zany things people have done to save a penny. If you are single, have friends who are as cheap as you, or you have a job where your cheapness has no effect on your employment, you can be a big of a tightwad as you want. As we get older, we tend to care less about what other people think anyways.

But for many of us, we usually like having friends, maybe meet a partner, and have a good job with possibility of advancement. These things tend to require one to be a part of society and keep up with social norms.

Someone who refuses to go out to do fun things because it costs money will find their friend groups start to quit calling them up as often to get together.

Unless someone manages to find a partner who is also as cheap as them, which isn’t going to be super likely because we all have varying degrees of frugality, don’t expect a relationship to last when one’s skimping in a social setting causes their spouse to turn deep red in embarrassment. All that saving will also be for naught when they decide they’ve had enough and ask for a divorce and get half of everything.

Or if you are an office professional who shows up to work in torn jeans and frayed t-shirts from the thrift store when everyone else is decked out in nice suits and dress shirts. You won’t get very far in your career when your boss decides your penny-pinching is reflecting poorly on the company.

Follow the below tips on how to navigate between being frugal versus being a cheapskate.

Being Frugal Isn’t About Always Getting The Lowest Price

A cheap person will almost always buy based on what is the lowest price. Never mind that the lowest cost item ends up breaking more frequently if it is not made as well. They might even buy the item again if the first one breaks. This is penny wise and pound foolish and will end up costing them more in the long run.

Being frugal means trying to get the best value for your money. This could mean buying the lowest cost item because it meets all your needs. Or it could mean buying the most expensive item because it has the features you want. It could also mean buying something in the middle. The smart shopper will do their research, read reviews, and make the best decision for their needs with their purchases.

One example of this is I often buy Walmart’s Equate brand of fluoride mouthwash. It has the exact same ingredients and concentrations as those of Listerine at half the cost. On the other hand, I don’t buy their Equate floss because I found that it shreds, so I pay a little more for the Johnson & Johnson floss.

Stingy People Are Shortsighted

Because cheap people are so focused on price, they don’t look at the bigger picture. A decade old fridge from Craigslist may work perfectly fine and could run for another decade. So what if it looks a bit rough. It still turns on and keeps their ice cream cold.

The frugal person knows that they will be using a fridge daily for years and will be willing to spend a little more to get a newer, or new but scratched or dinged fridge from the outlet store. The frugal person knows a newer model will have better energy consumption and therefore save them more money in the long run.

There are many factors that are just as important as price in making a purchasing decision. One should consider an item’s longevity, usefulness, the time saved, warranties, and even the health benefits.

Take for example batteries. Shortsighted people will keep on buying and throwing out disposable batteries. A frugal person will spend a little more initially for rechargeable batteries and skip buying any more batteries again for years, which will save both money and the environment. Another example would be spending the money for a good pair of running shoes for the cushioning and breathability to avoid future knee problems and athletes’ foot.

Frugality Is A Balancing Act Between Time and Money

People who value money over everything else will sacrifice their time to save money. They see money as being more important than their time.

A frugal person will try to find the best returns for the investment of their time and money. There is only 24 hours in a day and this doesn’t change no matter how much money someone has. One can always make more money, but they cannot get more time once it has passed.

An example of this is choosing between buying a handsaw or a circular saw. Power tools cost more but can get the same amount of work done in a fraction of the time. Recently I added more memory on my computer because it would allow me to keep more tabs open and work more efficiently.

You can also see this in the morning and evening commutes. Most jobs tend to be located in the city and housing within the city usually costs more because of it being closer to everything and land being more expensive. What usually happens is people end up buying a larger house farther out in the suburbs. The farther away from the city the cheaper the houses, but the longer the time spent sitting in traffic. They are trading money at the cost of time spent commuting.

Cheap People Are Inconsiderate

Everyone knows that going out to eat will usually require tipping the wait staff. A miser will leave a small tip even for excellent service and justify it by saying the restaurant should pay their employees better.

The frugal person will either go out to eat less often or order water instead of a soda so they’ll have the money available to tip as expected. Instead of avoiding turning on the air conditioning in the summer and making their partner strip down to stay cool, as appealing as that may sound, they will find better ways to save money during the summer because winter is coming and that means their partner will layer up and look like the Michelin Man.

Life is more than just about money. Relationships and friendships are important too. Offer to take a friend out to lunch or dinner on their birthday. Go out and do interesting activities with your family. Last month when my friend was in town, we went out to lunch and I paid for his meal, which was only $12 more, but being able to catch up on what was happening in our lives was priceless.

Money and things can be lost, broken, or stolen. Memories and experiences are forever (unless you get Alzheimer’s or amnesia).

We All Love A Bargain, But Never Expect One

Everyone loves getting a good deal. It is acceptable for someone to ask about a discount, but nobody deserves one. A frugal person knows that life is about compromise. Getting mad because you are told no only leads to an increase in blood pressure and people who happen to be watching will think you are unreasonable or entitled.

Abusing store return policies is cheap. Don’t be that person who goes to return a dead Christmas tree to Costco after the holidays. You are only embarrassing yourself by posting on social media that you weren’t allowed into Sam’s Club so your kid can try the free samples because you aren’t a member. 

Closing $ense

The key to being frugal and not cheap isn’t about avoiding spending money. Instead it is about choosing what is important to you and spending your money on those things while cutting costs on the things you don’t care about. It is often said that one cannot take their money with them when they die. It is ok to splurge a little to have a better quality of life as long as it’s done in moderation.

Being frugal doesn’t mean being boring and living the life of a spartan. You don’t have to eat only rice and beans and sit at home doing nothing. You can still be frugal and live a rich life.

What are some things you’ve seen or heard cheap people do? What are some frugal ways you’ve saved money?

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