What exactly is the difference between being frugal and cheap?
When you tell someone that you are trying to live a “frugal lifestyle,” you often get a funny look from that person. Or even worse, a look of sympathy.
These people don’t understand what being frugal truly means. They might even associate it with being cheap or that you are a tightwad when it comes to spending money.
While I do enjoy sharing my story of frugality, I will always run into someone who just doesn’t get it. And they argue with you. And then they argue some more.
I choose to agree to disagree with these individuals and move on with my day without wasting another thought on them.
So maybe you run into this discussion and don’t have the best points or rebuttals to bring to the conversation. Or maybe you are just starting to dip your toe into living a frugal lifestyle and just want to know more about it.
Either way, I want to help you better understand the difference between being frugal and cheap.
What does being frugal mean? What is a frugal lifestyle?
First, let’s start out by discussing what being frugal means. While there are tons of definitions out there, here is mine:
Being frugal means that you are intentional with every dollar that you earn and every dollar that you spend. Your focus is on the value or quality of your purchase.
Living a frugal lifestyle is truly a state of mind. It’s focusing on what is important to YOU and focusing your energy and/or money on that.
And for the record, yes, I choose to live my life frugally.
There are three main differences between being frugal and cheap. I go into more detail for each difference below. You will start to notice a trend in the traits of being cheap.
1. Big Picture View/Life of Purchase versus Lowest Price Possible
2. Personal Integrity versus Saving Money at all Costs
3. Value/Quality versus Lowest Price Possible
Difference Between Being Frugal and Cheap – #1
Big Picture View/Life of Purchase versus Lowest Price Possible
Being frugal is having a big-picture goal in mind and then using the self-control and patience to implement money-saving strategies to reach the goal.
Being cheap means that you might purchase the cheapest option possible, regardless of any other factors.
If you are frugal, you focus on quality. If you are cheap you focus on the lowest price, period.
I ran track in high school and would often have shin splints by the end of the season. One simple way to help prevent shin splints is to wear high quality shoes that are designed for running.
If I was cheap, I would try to find used shoes or even the cheapest pair of running shoes that I could find. In reality, being cheap and running with the used shoes could actually cost me more money in the long run by having to buy shoes more often, as well as possible medical bills or medicine for any running injuries.
Being frugal means that I make quality running shoes a financial priority. I research to find the shoes that I want, search for the store that has them at the cheapest price, and then budget accordingly so that I have enough money for the purchase.
Next, I would also implement frugal saving tactics to help me save the money that I need. I might stop eating out and make only home-cooked meals for two week straight. I also might try to reduce the amount of meat that I buy for groceries and find some lower-priced protein options.
Another example of frugality is when you consider the “life of the item.”
As you do in college, we had a cheap vacuum cleaner. It cost probably $40. It did an average job of cleaning the debris from our carpets.
But it would die every two years or so. Spending $40 every year to buy the cheapest vacuum possible isn’t ideal to me when I can spend $200 and get a good quality vacuum but have it last much longer.
Yes, it will cost you $160 more upfront, but over the “life” of the vacuum you would actually save money, especially if you watch for sales and get a nice vacuum for even cheaper than $200.
I would also point out that the waste produced purchasing a nicer vacuum is significantly less since you aren’t sending a vacuum to your landfill every two years. The nicer vacuum also does a much better job cleaning up dirt and debris from your carpet.
You will be shocked and/or slightly sick at how much dirt the new one will pick up compared to your old one!
Difference Between Being Frugal and Cheap – #2
Personal Integrity versus Saving Money at all Costs
I want to start this section by saying that just because you are “cheap,” that does not make you a bad person. Nor does being frugal mean that you are perfect. The examples below are just situations that I have witnessed of others. We are all likely guilty of at least one of the examples below at some point in our lives but hopefully you have learned that if you make charity donations a priority, you can give back to others without having to use the practices below to save money.
The goal of saving money is the same for both frugal and cheap people, but the path that each takes to get there can be extremely different.
To save some money when eating out, frugal people might only order off of the happy-hour menu, or only go to a restaurant where they have a coupon for. They save money, but do so in a way that is fair to them and to the restaurant.
If you are cheap, you might not tip your wait staff at all, or if you are out with a group of friends you might not order anything to eat but instead eat off of their plates. You saved money but at the cost of others around you.
I love the idea of reducing waste by re-gifting items that you don’t need or that you didn’t like when you received them. The key here is who you choose to give those items to.
If you are frugal you would only re-gift the item if you know that that the person receiving it would love it. You wouldn’t re-gift a bottle of wine to someone who can’t or doesn’t drink alcohol.
If you are cheap, you might just give that bottle of wine to that person anyways, as long as you didn’t have to spend any money on the gift.
The key to re-gifting is making sure that your reasons for giving it to the next person aren’t completely selfish and that it is something that they will enjoy.
During the holidays you likely have a few parties, whether work related or with friends and family, and chances are good there will be some free food there.
If you are frugal, you might try to eat a late lunch and then just plan on the free food that you eat there to be your supper for the night.
If you are cheap, you might not only eat the free food at the party, but then try to take leftovers home in your pockets or purse. This is truly only acceptable if the host of the party offers leftovers to you.
The key to being frugal and not cheap here is to make sure that what you are doing to save yourself some money isn’t putting anyone else at a disadvantage.
Difference Between Being Frugal and Cheap – #3
Value/Quality versus Lowest Price Possible
Frugality uses value or the quality of an item as the bottom line where cheapness uses price as the bottom line.
You can circle back to the vacuum example from difference number one. If you are frugal, you buy something that is of the quality that you need and want, but try to do so by buying it on sale or with a coupon.
Being cheap means that price is the only factor, and you want the lowest price possible. Period.
There are some times where I would value my time over saving some money. I consider myself frugal but I try to avoid Black Friday shopping at all costs. There are some awesome deals during this time but the stress and anxiety that being out in those crowds causes me is not worth it to me.
Being Frugal will be different for every person
What frugality means to me might be completely different to you. I choose to spend less on clothing, expensive groceries, etc. so that I can spend more on paying down our mortgage or being able to buy my dogs toys and treats every month.
The one takeaway that I hope you get from reading this post is that being frugal simply means that you choose priorities that are worth spending money on and then you implement money saving strategies in your life to make sure that you have that money available.
If you need help getting started on saving money to put towards your priorities, check out this post about the 10 Things that I Stopped Buying to Save Money, or this post about The Easiest Way to Create a Grocery Budget.