Cheap vs. Frugal: What’s the Difference?

February 11, 2015 at 12:00 pm by Andrea Ditter-Middleton | Articles

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Cheap vs FrugalAre you cheap or are you frugal? When you’re trying to save money or pay off debt, it can sometimes be hard to tell, and tempting to do anything necessary to dig out of a financial hole. And, especially when you are making pattern changes in your life, it is also common for others to throw out accusations in order to get the “old” you (i.e. the spendthrift) back.

Furthermore, we live in a society that is plagued by problems that stem from instant gratification. In this respect, success stories like Cindy’s, which show how small changes add up to big rewards, can make people a bit overzealous. Even though Cindy’s story – and others like it – clearly state that she saved $11,000 over the course of a year, when people first start to make financial changes like couponing they expect to see similar savings now.

But a year is 365 days long and most of those savings only even appear when you look at patterns over time. Yet, people get discouraged quickly. I see it in comments all the time. They cannot understand why their efforts don’t translate to an exact $916.67 savings every month.

So what do they do? Many people quit. Others take more extreme measures to “save” even more money. Today, I want to focus on the later.

Frugally “Saving Money” Versus “Being Cheap”

It is easy for me to throw out a bunch of clichés about being cheap vs. being frugal to help you understand this concept better. One popular one is “being frugal is about focusing on value, while being cheap is about focusing on price.” But I think it’s more important to look at the specific actions people take in one lifestyle vs. another. Here’s a basic breakdown:

A Frugal Person… A Cheap Person…
  • Puts people before savings. S/he doesn’t under tip at a restaurant or “forget” to bring a gift to a child’s birthday party.
  • Will do anything to save money. This includes “forgetting” to account for tax and tip when splitting a check or buying something at a garage sale as a gift.
  • Uses coupons, shops sales, and stacks offers to get the most value possible for items they want and need.
  • Absolutely refuses to buy something – even something essential – if they cannot get a good price or a sale on it.
  • Is willing to spend more money to get more use from something or have a better experience.
  • Automatically chooses the least expensive option, regardless of what it actually is.
  • Prioritizes spending in order to get more of what s/he wants.
  • Focuses solely on spending less or nothing at all.
  • Value their time. This includes paying other people to do what they cannot and limiting the hours spent scrutinizing small deals (i.e. paying $.50 for a toothbrush vs. getting it free)
  • Are willing to sacrifice time to save money, regardless of how much they “earn” through that choice (i.e. reading every sale paper and every blog post for hours in order to save $0.25 on cereal)

So clearly, the cliché here makes sense, but I like this one more:

A cheap person focuses on living their life with the mantra “I’ll be happy when…” whereas a frugal person focuses on being happy with what they have now.

What are some ways that you have been able to be frugal instead of cheap?

Cheap vs. Frugal, What's the Difference