Difference In Being Frugal, And Being Cheap

What is the first word that comes to mind when I say the word frugal. Cheap? If so, you are not alone. Most people tend to incorrectly associate being frugal with being cheap, when in fact they are two entirely different ways of looking at financial life. Dictionary.com defines frugal as “prudently saving or sparing; not wasteful.” The same online dictionary service defines cheap as “stingy; miserly.” But the differences don’t stop with the words’ definitions. Frugal people spend, give and consume a little differently than their”cheaper” counterparts.

Followers of frugality generally believe in being lightweight consumers of resources, whatever those resources may be. For instance, many frugal people prefer to make meals from scratch rather than paying several times for the cost of equivalent foods at a restaurant. Cheap people also frequently look for deals, but still could be heavy consumers of resources. Many cheap people will buy things on sale just because they are on sale, not because they really need them. Frugal individuals hunt for sales, too, but buy only enough to live on for the immediate future.

Need more evidence? I’ll use myself as an example. I appreciate value in a product, even if it costs more than a cheaper alternative. My time is important to me, so I’ll pay a little more for convenience items in a pinch, or shop at a nearby store to reduce the commute time to drive to another area just to save a couple dollars. I recognize good service, and am willing to tip extra to show my appreciation when I receive it. In fact, I typically leave minimum 20% tips when we dine out and receive exceptional service. After all, we don’t eat out that often, and the two or three dollar difference in 10% and 20% doesn’t change my world much, but it may mean the world to our server. I enjoy giving to help family members, friends and strangers. In fact, one of my life goals is to become so wealthy that I can play Secret Santa and give a lot of it away.

The typical cheap person generally displays the polar opposite qualities. When it comes to shopping, many cheapskates will drive all over town to save a few cents on a gallon gasoline, or a loaf of bread. These types will pass up sales on quality products because the final price is still higher than the cheaper alternative. Many would never consider tipping anything above the 10% rule, even if it meant counting out the $3.90 on a $39 bill – come folks, round up and live a little!

The one thing I have found that frugal folks have in common with cheap folks is there willingness to give, however they typically do it in different ways. Frugal individuals enjoy making monetary donations for causes they believe in, while their cheaper counterparts prefer to donate non-monetary gifts such as their time, their services, etc. Both types of givers are required for most charitable programs to be successful, so there is a place for each type, and I’m certainly not discounting the good deeds others have done without shelling out cash.

I honestly believe there is a little of each category in all of us (by “us” I mean those minding their money). I encourage you to think about ways you may be perceived as “cheap” and move towards frugality. I should take my own advice here and stop trying to buy the 1000-count cheapo napkins at wholesale clubs that my wife insists could double for sand paper. I think I’ll make her day and show up with a few packs of Bounty napkins next time I’m out (I have two coupons!).


  1. Very nice post.

    I have been wondering about this distinction for some time now. A lot of what is passed off as frugal, is just cheap & selfish. I am relieved that you cleared it up.

    I think this distinction is strongly related to the distinction between being an Idler and being a Slacker – another distinction that I have been thinking about.

    Headspace may well post on the second distinction in the next few days.

    Albert @ Headspace

  2. I think that one of the biggest differences in being frugal and being cheap is that frugal people look at the value of things not just the cost. There are times when you might pay more for something because you get more value for your money. Cheap means saving a dollar at all costs. For example, it might be more frugal to spend $20 on a dress that is good quality than to spend $10 on one from a discount store that will fall apart after one or two washings.

  3. I am working on leaning towards frugality, but started out just cheap 🙂 I think it is definitely a learning process!

    PS- You guys should try cloth napkins- that is SUPER frugal. I find mine at the thrift store for a quarter and since we switched, we have never looked back 🙂 Wait, or is that cheap?

  4. Amy, great tip on the cloth napkins! I may even spring for new ones with the promise of reducing our “paper products” budget going forward. Thanks for sharing.

  5. My wife called me cheap for years, but she’s slowly coming around to the true definition of the terms.

  6. Frugal: Buying Sam’s Choice colas for a party.
    Cheap: Serving it in tiny cups overfilled with ice.

    Frugal: Buying ground beef on sale for a cookout.
    Cheap: Making the burgers so tiny McDonald’s would be proud.

    Frugal: Searching the internet for vacation deals.
    Cheap: Staying in a cheap motel in a questionable section of town only for the price.

    When frugal goes too far, I call is financial anorexia. I have a post coming up on it!

  7. I think you’ve hit it on the head with value versus cost. It’s easy to buy the least expensive thing, but if it’s going to break in a few months what’s the point.

  8. I gotta join the comment party and do my part to make this great post stand out in yet another way – most commented upon.

    All of you nailed it. Cheap is a big turnoff. Frugal is smart.

    It’s always been a fun game I play in my mind whenever temptation/opportunity to spend money presents itself.

  9. Hi! Is it frugal or cheap to bring your own snacks to the movies? I took 5 kids to the movies yeaturday and we spent $45 on the tickets, and $48 on 1. Usually I bring canned sodas or juice boxes from home as well as a snack each. Is this frugal or cheap? By the way we went in the day, this was matinee price! Yikes! I did find out Tues. is $5 all day, so if we ever go to the movies again it will be a Tues., but snacks are never discounted and I can never afford $48 on snacks again (this is how much I spend on groceries weekly.) Thanks! -Becky R in NJ

  10. Becky R in NJ: Thank you for submitting your question. The movie snack sneak-in dilemma is a tough one. On the one hand, I am pro-business and believe theaters have the right to sell snacks at any price they want. However, the frugal side of me recognizes that the going rate for a tub of popcorn and a box of candy is ridiculous.

    If fewer people bought concessions at movies, one of two things would happen (or both). The price of concession items would go down and the price of general admission tickets would increase, still making for a costly outing.

    My suggestion? Wait for the DVD, make popcorn from home and skip the candy altogether (sugar, movies and kids don’t mix too well!). If you must get out of the house on the day movies are $5 I would recommend eating a meal at home and skipping the concession stand.

  11. Great piece. In my mind, the key distinctions between ‘cheap’ and ‘frugal’ are wastefulness and generosity. I really associate stinginess with cheap. Frugal people don’t have a lot but are so generous with what they do have. As you mentioned, cheap people will waste resources and do whatever they have to do to get the lowest price – it’s tunnel vision and they don’t care . Frugal people think big picture – most have high principles (e.g. even if it’s half the price as at the local mom and pop store, they won’t shop at Wal-Mart because it’s evil, etc.) and won’t compromise them to get the better deal. Most will go without or wait until all their buying criteria lines up before buying. In general, I think frugal folks are the smartest shoppers.

  12. thanks so much! I struggle with bringing snacks from home as being unethical. I think going to the $5 movie days and having a snack at home before or after the movie is a great idea. The movie should be enough treat for our kids.

  13. It’s important to point out that being cheap usually costs you more in the long run than being frugal. Edwards Demming condemned companies that go with the “lowest bidder”, because what saves them a little in the short-term usually costs them more in the long-term. They may save $1000 on a project by going with the lowest bidder, but it might cost them $5000 extra in the long run to get it re-worked again and again until it’s right. Or, it may never be right…they may end up with a faulty system as their foundation, and when everything else gets built on top of it, it’s difficult to just tear out the foundation and start anew. So, a cheap decision now can cost tons in the long run. And yet, many companies make that same mistake day in and day out around the world … only thinking 5 minutes in front of their face by just looking at the sticker price.

    For personal example, I used to buy some dress shirts at Wal-Mart. I thought I was saving money by getting them for $20. But, turns out they’re cheaply made, and tear up (lose buttons, threading coming undone, get torn up, look haggard, etc) in about 6 months of use. I got tired of that, but also didn’t want to shell out $50 at the mall for dress shirts. So, I went to Goodwill and got some high-quality Ralph Lauren, Geoffrey Bean, Van Heusen, etc shirts for $5/each … I’m still wearing them 5 years later and they still look brand new.

  14. I think to sum up this topic …

    People who are cheap think they’re being smart, but are really just exercising an almost knee-jerk reaction to what they’re buying. It’s pretty impulsive and usually selfish in a sense that they’re hoping to “take advantage” of someone or something to get a good deal.

    People who are frugal are exercising wisdom instead, by thinking ahead, and instead of taking advantage of others, usually focus on self-sacrifice to do without things that might cost them in the long run. The money they save can then be used for more long-term goals, like buying a car, a house, or donating to a charity, instead of just burning a hole in their pocket for impulse buys.

    Cheap people are reactive; Frugal people are proactive.

  15. Or instead of using fancy paper napkins, try using cloth napkins which tend to be nicer and can be re-used.

  16. I’m extremely frugal but I’m not cheap. I love to shop for bargains and get good deals on what ever I want or need. I will buy expensive items that most people would not consider as long as there is a price reduction taken. For instance I bought a projector for my home theatre and paid a price that 98% of the rest of the population would not pay. But it was important to me and I wanted it. I tip 20% all the time and am pretty generous with gift giving. But I am always on the lookout for bargains!

  17. Okay, so I know someone who has over $500K in the bank, NO house payment, NO car payments, NO kids, will get a nice pension when she retires in a few years, etc. Her and her husband will only go out to eat with a coupon, she tells him he can only buy off the dollar menu at McDonalds, will only buy frozen entrees under a dollar, will travel all across town for whatever item is on sale at the grocery store… she drives me nuts! How do you deal with someone like that? She is NOT frugal, I am pretty sure that is being CHEAP!

  18. thanks alot for your good posts.i need sth about stingy to discuss in our english class.please help me.thank

  19. I LOVE this post. I am DEFINITELY frugal, and I love to see it all categorized and very obviously ME! I will not buy seemingly inexpensive things that other people will buy because I do not see the value in it, yet I will buy things that other people consider expensive if the quality is high and the product is well-made. Many people tell me they think I spend too much on my shoes, but they last me 100’s of wears. When it is finally time for me to replace something, I will not purchase until I find EXACTLY what I am looking for (fits my ‘specifications’) and it just feels RIGHT. Until then I do without. I can easily walk away from a buy I’m on the fence with, and if it speaks to me the next day THEN I will go back. I think being frugal is ABSOLUTELY AWESOME! And my bank accounts thank me 🙂 I wish I could convince more people to join the club!!!