Frugal vs. Cheap: Which One Are You?

When I was in college I was cheap. There were things I wouldn’t buy that would end up costing me in the long-run. I bought a cheap laptop that was heavy and continued to give me problems for years. I didn’t sign up for a gym membership because I wanted to save money and I developed back problems that could have been avoided. I was also frugal though. I didn’t ever buy textbooks brand new and if I could borrow one from a friend or check it out of the library I wouldn’t purchase it at all. I didn’t bring a car to school to cut down on expenses. I rarely ate outside of the cafeteria, and when I did it was at a five or ten dollar place. I worked hard to find college scholarships to help pay for school.

After college I began to realize the difference between being frugal and being cheap. There is a thin line between the two. For yourself and others close to you, it is important that you make the distinction extremely clear in your mind and choose to avoid making “cheap” decisions.

Are you living a frugal life and being a cheapskate?

What’s the Difference between Being Frugal & Being Cheap?

Frugal: Going to eat a restaurant during Happy Hour. Cheap: Not tipping at a restaurant for service.

Frugal: Buying a used, low maintenance car like a Toyota Camry and doing scheduled maintenance. Cheap: Buying a beater for < $1,000, never getting anything fixed, and driving it into the ground.

Frugal: Doing research on travel plans for deals on hotels and transportation. Cheap: Staying in an unsafe area or walking through a sketchy part of a city to save a few bucks.

Frugal: Renting a movie and having a bunch of friends over to watch it. Cheap: Sneaking into a movie theater.

Free car

When you are acting in a cheap way, your actions can hurt others. In the cheap examples above, you are stealing from others or are putting other people in danger.

When you are acting in a frugal manner, you are just being a cost conscious consumer and saving your money to use for something else you value you more.

My Challenge to You

The world needs less “cheap” people. This change will only happen one person at a time, so I have a challenge for you.

This week, when you make a decision that is in any way related to money, decide whether or not you are being frugal or being cheap.

You will be able to tell the difference in your gut. If you not sure, ask a close friend and they will know.

It isn’t easy to live a life void of all potentially “cheap” decisions. I struggle with it myself and have hurt people by making the wrong decision a few times. There is always progress to be made on this though.

So, are you frugal or are you cheap? I’d love to hear some examples from you in the comments below about what the difference is in your mind.

(image via waitscm on Flickr CC 2.0)

MoneyCaleb Wojcik