Frugal vs Cheap: 10 Ways Saving Money Is Stingy or Smart

Cheap or Frugal

What’s the difference between frugal and cheap?

Remember the “wedding invitation” episode of Seinfeld, where George picks out the lowest priced envelopes for his and Susan’s wedding announcements?

He couldn’t care less if the envelopes were old or difficult to seal, he just wanted to pay the least amount of money possible.  Even with his fiancee’s hesitation to buy these defective envelopes, he insisted on it.

This is a great example of what it means to be cheap.  George wasn’t concerned about the quality or what his fiancee wanted.  He only cared about paying the lowest cost.

And we all know what that got him … a dead fiancée.

Okay, okay, being cheap doesn’t always end so dramatically.  But it got me thinking about being frugal vs cheap.

These days, people wear their frugality on their sleeves like a badge of honor.  And yet, we can get really annoyed with someone like George Costanza who’s just trying to save a buck.

So, what’s the difference?

Want to learn easy ways to save more money? Download this free 50 Tips to Save More Money checklist!


Describing frugal vs cheap

Sometimes just turning to the dictionary can help in understanding the difference between two words.  So, let’s do that.

Frugal:  economical in use or expenditure; prudently saving or sparing; not wasteful

Cheap:  costing very little; relatively low in price; inexpensive

From these definitions we can see that there is a major difference between frugal vs cheap.

Being frugal is concerned about not being wasteful, while being cheap focuses on getting the lowest price.  Of course, you could achieve both goals at the same time, but often you’ll make different choices based on your priorities.

Frugal vs cheap: which is better?

Although cheap and frugal seem like very similar characteristics, they actually develop out of very different money mindsets.

A person who is cheap tends to focus on what benefit they can gain for themselves in the present moment.  They prioritize short-term results and lack a big-picture vision.

A frugal person, however, considers the long-term consequences of their financial decisions.  They know the lowest price will save them a few pennies today, but may also result in an overall poor experience.  This is why frugal people prioritize value over price.

Another big difference between frugal vs cheap is how each affects the people around you.

Because a cheap person’s priority is to minimize their own personal financial sacrifice, they are often unaware of how their choices disturb others.  Penny-pinchers, stingy tippers, and ungenerous givers all tend to put their own needs first.

A person who lives a frugal lifestyle doesn’t let their spending habits affect others negatively.  Even though they try to make wise financial decisions for themselves, they don’t make these choices at the expense of others.

Obviously, being a cheap person has some negative consequences.  Besides being short-sighted and inconsiderate, a cheap person will likely waste money and resources in the long run.

Although a frugal person also desires to spend less money, most people recognize frugality as an admirable trait.  This is because being frugal isn’t just about saving more, but managing money efficiently and effectively as well.

Examples of frugal vs cheap

There’s nothing wrong with wanting to spend less and save more.  But, when your highest value is the lowest price, you can make poor spending choices – often at the annoyance of those around you.  Here are just a few examples of how cheap and frugal people can be different.

A cheap person may drive 10 miles to save 10 cents a gallon on gas, without a thought for how much time (and gas!) it requires.  A frugal person would weigh the lower price with how much they value their time, and use their gas reward points at a closer station.

A cheap person would want to split a meal, use a coupon, and only tip on the reduced bill.  A frugal person would order her favorite entree (but just drink water), use a coupon, and tip on the full cost of the meal.

A cheap person would brag about how little she paid for her bridesmaid dress at Walmart.  A frugal person would use her store reward points to buy a quality outfit, and not say a word.

A cheap person would buy particle-board furniture to furnish her living room.  A frugal person would invest in high-quality pieces when they go on sale because she knows they’ll last a lifetime.

A cheap person will want to save $20 on a cheaper pair of shoes, even though they’ll wear out in a year.  A frugal person will spend more on a quality pair (when they’re on sale) because she values reducing waste.

Now that you have an idea of the difference between being frugal vs cheap, decide which type of spender you are.

You may be a cheapskate if …

  1. If we take George as an example, we can see clearly that cheap people care only about the monetary cost.  Their main goal is paying the lowest amount, regardless of the loss in quality or value or time.
  2. George only cared about his selfish desire to save money and didn’t give a hoot about Susan’s feelings.  People who are cheap don’t consider how they negatively affect the people around them.
  3. Because of his cheapness, Susan ended up getting sick from licking the defective envelopes and died.  This is an exaggerated example, but it’s similar to being a bad tipper in that cheap people will save money at the expense of others.
  4. Because cheap people only care about the cost, they will often choose lower quality or less reliable products to save money.  They focus on the short-term, not considering they will get less use out of the inferior products they purchase.
  5. Lastly (and dare I say obviously), people who are cheap have a mindset that values money itself, and so their priority is to save as much as they can and hold on tightly to what they have.

Does this sound like you?  If so, you might want to adjust your money mindset and decide what you truly value.

Being frugal means managing money differently

  1. Frugal people like to save money but won’t trade value for a good bargain.  They spend money on things in life they highly value, and learn to cut costs on everything else.
  2. Those who are frugal don’t make money itself the priority but instead value people over savings.  Even though they like to save a few dollars, they make sure others are not inconvenienced by their frugality.
  3. Even though frugal people are purposeful with spending money efficiently, they won’t take advantage of situations without regard for others involved.  They like a good bargain, but they aren’t stingy.
  4. Frugal people know what they value, and they are willing to pay the higher price that comes with quality.  They don’t just consider the one-time cost savings, but also think about how much they’ll save in the long run.
  5. Each of these qualities of a frugal person points to someone who has a mindset that values money as a means to an end.  It’s not the money itself that is most important, but how it enriches their lives.

Don’t forget to grab your free 50 Tips to Save More Money checklist!


Which side of the line are you on?

Even though the differences between being frugal vs cheap are significant, it’s still a fine line that separates the two.

Did you find you recognized yourself in one list more than the other?

I like to consider myself a frugal person, but going through the lists above I have to admit I’ve been guilty of behaviors from both.  When you live paycheck to paycheck, it’s a struggle to not try to pinch every penny.

But being cheap isn’t a personality trait.  It’s a mindset.  If you think you’ve been living the life of a cheapskate and you want to break free, all you have to do is start changing your perspective.

I’m still working on transforming my money mindset, and it’s a process.  But if I can just focus on what I truly value in life, remember to think big picture and long-term, and remain generous, I think I could call myself a frugal rock star.

Other posts you may enjoy:

Want to remember this post for later? Pin it to your favorite Pinterest board!

Frugal vs Cheap pin

Frugal vs Cheap: 10 Ways Saving Money Is Stingy or Smart

Leave a Comment

Your email address will not be published. Required fields are marked *

Scroll to Top