There are numerous phrases and sayings we hear about when it comes to our money, and cheap and frugal are two words that commonly get tossed around. But do you know what the difference between being cheap and being frugal really is? There is a fine line between being frugal and being cheap and since there is no exact science to determine the differences, we help explain the differences between what passes as frugal or what you can get called out for when it comes to being cheap.
When it comes to our money we all like to save where we can. But it’s about your saving and spending habits that can really depict if you’re frugal with your cash, or just straight up cheap. One way to see it is cheap people think short term where frugal people think long term.
As Investopedia describes frugal people understand that paying more upfront can result in better quality or long-term benefits resulting in better value but people labeled as cheap wouldn’t pay a premium price regardless of the value. Just because something is less expensive in price doesn’t necessarily make it cheaper once other costs are included.
Are you the person who is constantly complaining about the price of everything? That is a key indicator that you fall on the cheap side. When all you’re concerned about is price and not the overall value and voicing how expensive items are.
Being frugal isn’t about cutting your spending on everything, but can be seen as choosing the things you love enough to spend money on, and then cutting costs on other things in your life that you don’t value as much. It’s about picking and choosing what you spend and save your money on.
When it comes to shopping there are many ways to save money that we’ve talked about in the past. And when we talk about saving you money it’s because we think everyone should get the best bang for their buck. But some of these strategies we discuss can be seen as cheap compared to frugal to some.
If you’re still curious about what category you fall under? Business Insider created a great chart that shows the differences between those who are cheap and those who are frugal. Make sure to check it out to see what money habits you have and let us know if you fall into the cheap category or the frugal category.