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Frugal vs Cheap: Understanding the Major Differences

Frugal vs Cheap

Frugal vs Cheap.  Both are misunderstood.

Have you ever stared at a price tag, wrestling with the decision to go for the cheaper option? Or maybe you find yourself questioning if your money-saving habits make you frugal or cheap. Well, here’s an insider secret there’s a world of difference between these two!

Picture this. You’re in a store eyeing both generic toilet paper and the slightly pricier, softer brand. Your heart says comfort; your wallet screams savings.

You see, being frugal is like that second layer of skin we grow when it gets chilly out, protective but flexible.  It’s about making smart choices and not compromising quality for the cost of a product.

On the flip side, being cheap can sometimes feel like a straitjacket if you know what I mean.  It can be way too snug and limiting! But anyway, listen up today I have some awesome tips ready to help you out.

Table of Contents:

Understanding the Difference Between Frugal and Cheap

Frugality and cheapness are often mistaken for one another, but they represent very different approaches to personal finance. Are you ready?  It’s time we unmask these misunderstood twins.

The Definition of Frugality defines frugal as “economical in use or expenditure prudently saving or sparing, not wasteful”.  A frugal individual puts a priority on long-term financial health, rather than immediate gratification.

They’re willing to spend money if it leads to more significant benefits down the line. A frugal option may cost more upfront, but its value pays off over time.

This mindset doesn’t just save money, it also makes money work harder for them.

For instance, instead of buying inexpensive items that wear out quickly (like work clothes), they might invest in higher-quality pieces that last longer and look better too.


For more in-depth financial tips, you may enjoy my previous articles 
Financial Tips for Young Adults
How to Save $1000 a Month

The Definition of Cheapness

I know everyone may have a definition of cheap. However, I think that cheap is what it is and that’s cheap cheap.

In contrast, being cheap means prioritizing low costs above all else, even at the expense of quality life experiences or long-term goals. “Cheap”, according to, signifies stinginess or miserliness.

That is getting by with spending as little as possible regardless of any negative impacts on their lifestyle.

A cheap approach might mean using toilet paper instead of napkins at dinner parties because it pinches pennies today without considering how this decision could impact their social relationships tomorrow.

Folks can be quite creative when trying to cut corners financially. Have you heard about people reusing dental floss? Now that’s what I call extreme.

The biggest difference between being frugal and cheap boils down to the quality of life one chooses.

Frugality considers value over cost, focusing on long-term financial goals rather than just price tags. On the other hand, a cheap person’s sole focus is minimizing expenditure.

Remember this: Frugality feeds freedom and Cheapness chains you.

Getting the hang of these crucial differences is key. 

Being frugal is all about long-term value, and making smart choices to make your money work harder. It’s not just saving but spending wisely for bigger benefits down the line.

On the flip side, being cheap means cutting costs at every turn without considering quality or future impacts.

Now don’t forget: Frugality feeds freedom while Cheapness chains you.

Strategic Saving Habits of Frugal vs Cheap

A frugal way of living may bring about several benefits, including financial solidity and a feeling of accomplishment. But what makes frugals stand out?

Frugal people tend to prioritize their spending on things that add value to their lives. They aren’t just about pinching pennies. They’re focused on getting the best bang for their buck.

Rather than being labeled as ‘cheap’, a frugal person focuses on quality rather than quantity when it comes to spending.

For instance, if two jackets are available one expensive yet durable and another cheaper but less sturdy, the frugal approach would be to buy the costly jacket considering its long-term utility.

This strategic saving doesn’t mean they don’t enjoy themselves or spend money at all instead, they allocate funds more efficiently towards experiences or items that truly matter to them.

According to stats, Plutus Awards, one of the top finance websites for women points out that frugality isn’t about deprivation – it’s about making your money work harder for you.

In addition to this mindful money management, frugals have an eye toward long-term financial goals.


For more in-depth tips on saving money, you may enjoy my previous articles 
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Securing Your Financial Future


Saving up now allows them freedom in future decisions whether those involve retirement plans, travel dreams or simply maintaining a certain standard during rainy days.

Prudently saving is seen as an investment into future happiness rather than a sacrifice for today’s desires.

If practiced well, the “Living within means” mantra not only gives you control over your finances but also provides peace of mind and a sense of achievement.

The practice of being economical is more than just cutting costs. It’s about living the best life possible within your means, focusing on long-term goals while enjoying today. Essentially, this summarizes the advantages of being frugal.

Being frugal isn’t about scrimping every penny. It’s about strategic spending for maximum value. This lifestyle prioritizes quality over quantity, focusing on long-term financial goals and finding fulfillment in living within means.

So remember, being frugal is making your money work harder for you. It’s an investment into future happiness.

10 Clear Differences Between Being Frugal and Being Cheap

Let’s highlight ten examples that distinguish a cheap approach from frugality. These life lessons can make your money work more efficiently for you.

These are just a handful of what I think are examples of frugal vs cheap.

Let’s get into this!

1. Quality Over Cost

A frugal person sees the price tag but prioritizes quality.  They’re willing to spend more on an expensive item if it means getting good quality, durability, or value over time.

In contrast, a cheap person tends to buy inexpensive items with little regard for their longevity or functionality.  hey are only thinking about the here and now.

2. The Regret of Cheap Purchases

Cheap people focus on buying the cheapest option available. However, this often leads to regret when these cheaper versions fail prematurely.

This resonates with 63% of people who reported regretting buying cheaper versions.

On the other hand, frugal individuals invest in quality items they need and use regularly rather than being swayed by the lowest cost alone.

What a cheap person doesn’t understand is that 9 times out of 10 they are going to pay in the long run.

Two cheap items over the next several months will cost the same as something more expensive in the long run.

3. Savings vs Pinching Pennies

As I have been stressing through this article frugal people save money intentionally towards long-term goals while the penny-pinching mindset may not have such foresight.

Cheap people tend to hoard every penny even at inconvenient costs while those practicing prudent saving understand strategic spending is necessary sometimes.

Prioritizing Spending

Frugal people prioritize spending based on needs versus wants whereas cheapness typically manifests as excessive reluctance to part ways with any cash whether essential expenditure or not.

Eating Out vs Cooking At Home

Frugals might choose to cook at home most of the time, but they won’t shy away from enjoying a meal out occasionally. Cheap individuals often avoid eating out entirely because it costs money.

Value Another’s Time and Skills

While frugal people value another person’s time and skills and are willing to pay for it, cheap people tend not to recognize this at all.

So, here’s the deal. “Cheap” can sometimes sound like you’re being a penny-pincher or tightwad. But when you begin to save mindfully, that doesn’t have to be the case.


Here are some important notes:

Being frugal is about making smart, long-term financial decisions prioritizing quality and value over cost.

It’s about saving intentionally for future goals, respecting others’ time and skills, and enjoying life within means without being excessively penny-pinching.

On the other hand, cheapness often results in regretful purchases due to low quality or lack of functionality.

How to Be Frugal Without Being Cheap

Would you agree that saving money is an art, and the canvas of this masterpiece involves careful spending habits? It’s not just about collecting every cent. It’s more about creating financial choices that grant you liberty.


For more in-depth tips on saving money, you may enjoy my previous articles 
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1. Be Mindful of your Spending Habits

Firstly, frugality isn’t synonymous with stinginess. Prioritizing spending on items that are most important to you is the essence of frugality.

This could be a family vacation or investing in quality work clothes – because first impressions do matter.

A smart spender understands that cutting costs at the expense of quality can lead to higher expenses down the line.

2. Understand The Cost of Being Cheap

And yes there is a cost to pay.  If you go too cheap at trying to spare the wallet it will bite you in the butt down the road.

Focusing solely on price tags often leads us into cheapness territory. For instance, buying single-ply toilet paper might seem like a great deal initially but ends up costing more as you use up rolls faster than double-ply ones.

Cheap people tend to focus too much on saving without considering value for money or long-term goals – which doesn’t exactly promote financial wellness.

3. Nurture Your Financial Health

Let me break this down for you. Frugality is about prudently saving while also enjoying life’s pleasures—big and small alike.

The trick here is finding ways to make your money work harder for you through smart investments and side hustles instead of pinching pennies unnecessarily.

If one truly wants their finances under control and still enjoys life’s luxuries from time to time then they needn’t buy inexpensive goods always.

Rather opt for good deals when available while not compromising on quality.

For example, a frugal person might choose to cut the cable and opt for a cheaper streaming service without sacrificing entertainment.

They make sure their spending aligns with their values rather than just being cheap.

Finally, frugality isn’t about extremes—it’s all about striking a financial balance. After all, it’s your cash and you should be able to handle it just right.


Another important side note:

Being frugal isn’t about pinching pennies, but rather making mindful spending decisions that align with your values and long-term goals.

It’s finding the balance between saving wisely without sacrificing quality or life’s pleasures. In contrast, cheapness focuses solely on cost-cutting, often overlooking value for money.

Tips to Avoid and Overcome Being Cheap

Shaking off the cheap mentality isn’t a sprint, it’s more like a marathon. It needs time, patience, and commitment. Let’s start by understanding that extreme cheapskates often miss out on quality experiences because they’re too focused on pinching pennies.

Firstly, let’s debunk one myth: saving money doesn’t make you cheap. Many Americans decided to save their stimulus checks during the COVID-19 pandemic – one in three, indicating financial prudence rather than miserliness.

1. Understand Value vs Price

The first step towards frugality is comprehending the difference between value and price tag.

A cheap person might opt for an inexpensive pair of work clothes only to have them wear out quickly while a frugal individual understands investing in durable items saves money long-term.

2. Have Knowledge About Credit Cards

Cheap people tend to fear credit cards but if used wisely these can be valuable tools for managing cash flow and even earning rewards.

Regular scrutiny of bank statements helps keep track of your spending habits which prevents debt accumulation.

3. Focusing On Long-Term Goals

I know this is a difficult one.  So many people have such a hard time gathering their long-term goals.

Rather than fixating on how much every little thing costs or how you could get it cheaper.

Focus instead on your long-term goals like financial wellness or home ownership.

These are things that require prudently saving up over time.

4. Be Mindful of your Spending Habits

Avoiding wastefulness doesn’t mean you’ve got toilet paper rationed. Consider this – buying bulk may seem cheaper upfront but leads to waste if products expire before use.

On the contrary, frugal folks prioritize spending on items they truly need and will use.

5. Always Invest in Experiences

Cheap people often miss out on priceless life lessons by avoiding experiences that cost money. But you can’t put a price tag on memories created from traveling or learning a new skill – something frugals value highly.

So, let’s get down to it. It’s time to start saving now. 

Shaking off a penny-pinching mindset is like tackling a marathon—it’s all about time, patience, and commitment. Grasping the gap between value and cost can help you embrace frugality.

Shelling out for quality often pays off in the end. And remember credit cards aren’t your enemy.  Smart use can control cash flow and snag some perks.

The Pitfalls of Being Too Cheap

Being excessively cheap can lead to unforeseen problems. Some folks equate being frugal with being miserly, but the two are different.

Frugality is about getting value for your money, while stinginess prioritizes spending as little as possible.

Cheap individuals often avoid parting with their cash at all costs and may even make others pay for them – a behavior that could potentially damage friendships.

According to an episode on the show Extreme Cheapskates, some people go to great lengths not to spend money.


1. Making Poor Financial Decisions: The Stingy Approach

A person who’s too cheap might make decisions solely based on price tags without considering quality or long-term consequences. This short-sightedness tends to focus more on preserving pennies rather than achieving financial goals or life goals.

Say you need work clothes, instead of investing in durable attire that would last longer, a very thrifty individual might opt for cheaper versions saving upfront cost but needing replacements sooner due to their lower quality – not prudently saving.

2. Don’t Neglect Value Over Cost

A common trait among cheap people is neglecting value over cost. They care more about the amount spent rather than what they get in return from their purchase.

For instance, canceling streaming services just because it adds up monthly charges regardless if it brings enjoyment after long working hours does show a lack of understanding when comparing a frugal vs cheap mindset.

4. Penny-Wise Pound Creates a Foolish Attitude

This term perfectly encapsulates one pitfall of being overly economical – focusing so much on minor savings that you lose sight of larger expenditures.

Take credit cards, for example. A cheap person might decide not to use a card due to the associated fees but fail to realize the benefits of building a good credit history or even enjoying cashback.

So while it’s important to save money and be economical, there is such a thing as being too frugal – where it affects your quality of life negatively instead of improving financial wellness.


Another important Thought: 

Remember, cheap and frugal aren’t identical. While being cheap means cutting costs even if it risks quality or connections, frugality is all about finding value for your buck.

Decisions driven by quick savings rather than long-term objectives or good quality might end up costing you more in the long run – a perfect example of “penny-wise.”

Finding Balance Between Frugality and Cheapness

Achieving a harmony between being economical and inexpensive necessitates sagacity. It’s about making your money work for you, rather than pinching pennies at every turn.

People tend to use the words ‘frugal’ and ‘cheap’ interchangeably. But they mean very different things in personal finance.

Being frugal means prioritizing spending based on value, not just the price tag. A smart spender, if you will.

1. Avoiding the Cheap Trap

To avoid falling into what I call the ‘cheap trap’, start by reevaluating your long-term goals. What do you want out of life? Once those are clear, align them with how you spend money.

Cheap people focus too much on saving that they often forget their quality of life or value another person’s time less than their own savings goal.

That can lead to buying toilet paper in bulk because it’s cheaper per roll but forgetting about storage costs – both space-wise and mentally.

2. Moving Towards Frugality

Moving towards frugality starts with focusing more on getting good deals rather than only looking at price tags – quality over quantity as they say.

If we’re talking clothes, for instance: buy high-quality work clothes that’ll last longer instead of replacing cheaper versions constantly (bonus points if there’s a sale.).

Or perhaps choosing a single streaming service instead of paying for multiple ones simultaneously might be more prudent.

3. Becoming Truly Frugal

The essence lies in finding ways to save money without compromising your quality of life or relationships. True frugality is about making financial decisions that make sense in the long run.

Consider this: Instead of eating out less, why not learn to cook more at home? It’s a fun side hustle, saves you a great deal, and offers priceless life lessons.

3. Frugal vs Cheap: Maintaining Balance

The real magic trick is keeping up with it all.  This one is what it is.  Do your best to not do too much on each end.

Here are some important notes:

Being frugal is an art of smart spending, prioritizing value over price. It’s about making your money work for you and aligning it with long-term goals, not just saving pennies.

To truly be frugal, focus on quality purchases that make sense in the long run without compromising your lifestyle or relationships.


How to be frugal but not cheap?

To avoid being cheap while staying frugal, focus on value over price. Buy quality goods that last longer and spend wisely rather than minimally.

What is considered a cheap person?

A cheap person cuts corners at all costs, often sacrificing quality or others’ comfort. They’re more concerned with saving money than getting good value.

Is frugal and stingy the same?

Nope, they’re different. Frugality means maximizing your dollar’s worth by making wise choices; stinginess refers to reluctance to spend money even when it’s necessary.

Do frugal people spend money?

Sure do. But instead of buying just anything, they put their cash towards high-value items and experiences that bring joy or usefulness for a long time.

Wrapping It Up

Deciphering the difference between frugal and cheap can feel like walking a tightrope. But you’ve got this! Being frugal is about prioritizing value, not just price tags.

You’ve learned that being cheap might save money now but could cost more later. And remember, buying quality doesn’t mean breaking the bank!

Avoid falling into the trap of cheapness by making strategic financial decisions and considering long-term goals. It’s your hard-earned cash – make it work for you!

In short, life isn’t just about pinching pennies; it’s also about enjoying what those pennies buy! So start saving wisely without sacrificing joy or quality in your life.

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