Frugal or Cheap?

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I still remember the first time someone said I was frugal.  I ran home and looked the word up in the dictionary.  Frugal was a new word to me and I wasn’t sure if I was supposed to take is as a compliment.  Since that time I’ve heard the word used lots (typically directed at me).  There is another similar word that I hear used – cheap.  So is there a difference between being frugal and being cheap?

Here are a few definitions of Frugal and Cheap from The Free Dictionary.

frugal [froo-gl] economical in the use of money or resources; thrifty.  Meagre and inexpensive: a frugal meal [Latin frugi useful, temperate]

cheap (chp) Stingy; miserly.

Translation: When someone calls you frugal they may be complimenting you.  When someone calls you cheap they most likely are not complimenting you.                                                        Photo by sister72

Functionally, here is how frugal and cheap differ:

  1. Frugality is a choice. Frugality is a decision not to spend money on something or to get a better deal on something in order to use that money for something else that is a greater priority.  Cheap is a characteristic. Cheap people don’t spend money just because they can’t stand the thought.
  2. Frugality is a personal decision with personal consequences. The frugal person might do something that is more time consuming or harder work so they can save money.  Cheap people make choices that inconvenience others or cost others more just to save something themselves.  For example, a frugal person might order water at a restaurant while a cheap person will under tip a good server.
  3. A frugal person will find ways to maximize their resources. A cheap person will utilize others’ resources or materials just to avoid having to personally pay for them.
  4. A frugal person recognizes the differences in the quality of products and will search and shop for the best deal on a better product.  A cheap person will always buy the lowest priced item regardless of quality.
  5. Frugal people will spend money in the short term in order to save in the long termCheap people, however, will not spend money today even if that means costing more tomorrow.  For example, a frugal person will have her vehicle inspected when it starts making strange noises.  A cheap person will wait until the car completely shuts down (typically resulting in a higher mechanical bill).
  6. Categorizing something as frugal or cheap is often in the eyes of the beholder.  You might practice something that you consider frugal living that another would deem as cheap.  There is no linguistic line between the two terms.  For example, I shop second hand.  I think it is being frugal, and others say I am just cheap.

Times when you should err on the side of overspending:

  • In situations when ethics and integrity are involved. Sure you could save money by printing that paper up at work instead of at home, but is it ethical?  When it comes to ethics, always err on the side of overspending.  When I have visited various forums where people ask questions I have come across the question, “Should I take toiletries from a hotel?”  My opinion is that if you have any ethical doubts about it – don’t take the item.  It is not worth compromising your integrity to save 50 cents worth of shampoo.

Better a little with the fear of the Lord than great wealth with turmoil. (NIV Proverbs 15:16)

  • When it is a one time event where relationships are at stake. On occasions it is best to go with the flow and spend a little more to preserve relationships.  If you have an annual get together with friends and they choose a more expensive restaurant, go with the flow.  Your investment in those relationships is more important than saving a few dollars.
  • Better a meal of vegetables where there is love than a fattened calf with hatred. (Proverbs 15:17 NIV)

  • When you are on vacation.  Go ahead and budget a little more to allow yourself a chance to ease away from counting every penny.  I would offer a caveat and that is that you should be sure to save enough money so you can be more carefree.  Don’t simply decide to spend money you do not have just because you are on vacation.  How do you do that?  Use cash because you don’t need to track it.  The money will tell you when it’s gone.
  • When it comes to issues of health and insurance. If you have a health concern don’t ignore seeing a doctor just because you don’t want to pay the money.  Furthermore, don’t drop your health insurance just to save a few hundred dollars a month.
  • When others benefit from your generosity. When you have an opportunity to help someone, you do not want to miss that because of your frugality.  Be open handed to others’ needs even if that means denying yourself sometime in the future.

A generous man will prosper; he who refreshes others will himself be refreshed. (NIV Proverbs 11:25)

  • When saving today has the potential to cost you more tomorrow.  When the truck is making a strange noise go ahead and take it to the shop.  Auto repair costs can escalate over time as the amount of work required may increase.

Here’s my philosophy when it comes to the frugal or cheap discussion.

I no longer concern myself with the labels people give me.  I would rather be called cheap and be debt free than to pay more than I choose to afford just to satisfy someone else.

How do you differentiate between cheap and frugal?  Any other times you think people should ease up on being cheap or frugal?


  1. says

    Somtimes there can be a fine line between frugal and cheap. In my own opinion, I often think of a cheap person as miserly, not generous, always looking out for their own interests and not the interest of others.

    I think we can sometimes push the line of frugality too much into the realm of cheap if we are not careful.
    .-= Jason @ Redeeming Riches´s last blog ..What is a Roth IRA? =-.

  2. says

    Thank you for this! My mom calls me frugal and I always thought of it as a bad thing until now :-) But I think there are a lot of people out there who think frugal=cheap. I would rather spend a little more to be more eco-friendly too. Something that some of our families don’t agree with.
    .-= Kristin´s last blog ..Don’t Throw Those Bananas Away! =-.

  3. says

    Interesting post. I agree with Jason that it can be a fine line at times between these two labels.

    Our kids joke about my husband and I using coupons nearly every time we eat out. However, we are able to enjoy dining out more often because we stretch that category of our budget with coupons.
    .-= Bucksome´s last blog ..Applying Kaizen Principles to your Money =-.

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