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?

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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.

5 major differences between a frugal vs cheap person

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

Here are five major differences when you consider being frugal vs cheap.

  1. 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 long-term vision. Someone who’s frugal has the bigger picture in mind, and has the self-discipline to wait for saving opportunities.
  2. A frugal person 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. Someone with a cheap mindset sees the lowest price as the overall goal, and focuses more on cost.
  3. Another big difference between frugal vs cheap is how each behavior 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.
  4. A cheap person is often resistant to spend money, because they fear they won’t have enough left for themselves. This is why they’re willing to sacrifice quality and time just to save a few bucks. A frugal person knows how to maximize her spending and get the most value out of each purchase. Therefore, she feels confident about how she spends her money.
  5. Cheapness really comes down to spending the least amount possible, regardless of the situation and the consequences. A frugal person prioritizes value over cost, so she focuses on spending more money on things that are important to her, and less on trivial purchases.
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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. Taking 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 prioritizing costs over prices

  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.

So … are you frugal or cheap?

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 identified yourself with one 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.

Take the frugal vs cheap test for yourself

Still not sure if you’re cheap or frugal? Answer these questions and come to your own conclusion:

  • Do you look for the cheapest option now, or wait for your favorite brand item to go on sale?
  • When you go out to eat with friends, are you anxious about everyone paying their fair share?
  • Do you tend to be critical of others who spend “too much” on things you know they can get cheaper?
  • Do you always ask to see the lowest-priced item when talking to salespeople?
  • Have you ever taken office supplies from work, or sauce packets from fast food restaurants, just to save a buck?
  • Would you rather spend less on paper towels than spend more on quality dish cloths?
  • Have you ever bought something with the intention you would use it once and then return it?
  • Do you spend hours browsing online stores looking for the cheapest price?
  • Do you look for the lowest price on maintenance costs to keep your belongings in good condition?
  • Is the purchase price the most important deciding factor when you go shopping?

If you answered “yes” to most of these questions, you probably struggle with a cheap mindset. In the long run, you’ll likely end up spending more, wasting time, and experiencing less life satisfaction.

It’s one thing to want to get out of debt and save as much as you can. But, it’s also important to consider how you’re maximizing your dollars to create more joy and fulfillment, rather than just getting by.

At the end of the day, ask yourself if you’ve aligned your spending with your values. As long as you’re being motivated by what matters to you most, you can feel good about spending less (or more!).

Frugal vs cheap: which is better?

Though it might seem like there is a delicate balance between being frugal vs cheap, the difference is significant. 

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.

How you can be frugal without feeling cheap

You may have been labeled “cheap” in the past because of your selective spending. Perhaps you only have water when you go out for drinks with friends, or you drive a 20-year old vehicle instead of the latest models like your co-workers.

I hope this post has helped you understand that the big difference between frugal vs cheap is in what you value. It’s not always about bypassing that expensive item because it costs too much. 

If you’re choosing to spend less in some areas so you have more money for things you really value, then you’re being frugal. The key to being frugal without feeling cheap is to know your money is being spent on what matters to you most. 

Your neighbors might not understand, but they don’t have to. The important thing is that you’re being intentional about using your money to increase your joy in life.

So, figure out what you value. If delicious cuisine and extravagant vacations are what make you happy, then you might want to spend less on your wardrobe and car payment. If you’re a home-body and love having a warm, comfortable environment, put more of your money into creating that special space for yourself, and less on eating out and traveling.

Bonus tip: Consider prices with purpose

Besides knowing what you value, it’s also important to consider what’s necessary and beneficial as a frugal person.

From a cheap mindset, someone may browse the sale items in the clearance aisle and decide to buy a few things because the prices are so low. Getting a good price feels good, even though they might not even need these things.

When you keep your spending aligned with your values and needs, you won’t be swayed by every good deal that comes along. You’ll be purposeful with what you’re buying, not just how much you’re paying.

So, be intentional with your spending. When you consider the price of an item, be sure it’s because you know the purchase will serve you well – instead of thinking you “might need it someday”.


Is being cheap the same as being frugal?

Being frugal and being cheap are two very different habits. A cheap person is primarily concerned about getting the lowest price, regardless of the outcome. In other words, paying the least amount is the bottom line. A frugal person, on the other hand, focuses on getting the most personal value for their dollars. Instead of just looking for the lowest price, they consider if the cost is worth the value they’ll receive. This motivation leads the frugal person to prioritize their purchases differently than the cheap person, and pay more for things they highly value.

How can I be frugal but not cheap?

If you want to be frugal but not cheap, your motivation for spending will be inspired by what you value, not what you pay. Prioritize what is important to you, so you can easily recognize what is not. A frugal person is willing to pass by really good deals and discounts if they’re not connected to their values. Instead, they’ll save that money and spend more on purchases that are meaningful and high-quality. This inspires financial decisions that reduce waste, avoid excessive spending, and improve quality of life.

What makes a person frugal?

What makes a person frugal hinges on their motivation for spending money. They are not influenced by deep discounts or good deals. They don’t buy something just because it’s on sale. Frugal people prioritize value over price. They are very selective with what they spend their money on, because they understand their financial limits but are committed to living according to their values. An example might be driving an old car that is paid for, so they have more money to travel. Or, buying clothes at a thrift store so they have more to spend on dining out with friends.  

What is the difference between being frugal and being stingy?

A frugal person makes spending decisions that do not inconvenience or take advantage of others. A stingy person is just unwilling to share with others, regardless of their feelings or their needs.

How can you tell if someone is frugal?

You can tell if someone is frugal by what they spend their money on. If they make unnecessary and frivolous purchases because the price was low, this is not a frugal person. Someone who is frugal is willing to spend more on items or experiences that align with their values. This means they are also willing to forego other expenses that are not a priority. However, frugal people are not impulsive shoppers. They will save up their money over time, and wait for the best deal for something they truly want.

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


Summing up frugal vs cheap

Whether you consider yourself frugal or cheap, the important lesson is knowing how to prioritize what you value. If your spending decisions are getting you closer to your long-term financial goals, then you’re on the right track.

But, if you feel like your spending doesn’t reflect what you truly value, I encourage you to take the time to make adjustments.

Consider what’s behind the fear of not having enough, and why you’re driven to save money at any cost. Work on creating an abundance mindset, so you’re not making decisions out of a place of scarcity. Write down some 5-year goals so you can start seeing the bigger picture.

Pretty soon, you’ll discover the joy of spending money on things you love, rather than saving money on trivial stuff.

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

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