Frugal vs Cheap: How To Overcome Being Cheap

Are you on a budget? The answer should be “yes”. It doesn’t matter how much money you make. It doesn’t matter if your income is big or little. The point of a budget is to direct your money where you need it for maximum effect.

Are you trying to save money? The answer should be “yes”. When you save money in one place–you have it to spend in another. However, how you go about saving money can say a lot about you and your priorities.

Frugal vs Cheap: What’s The Difference?

What are the definitions of frugal and cheap? Do they have any similarities? Are they completely different? First, we’ll start with a basic definition from Merriam-Webster:

  • Cheap: is described as stingy (not generous), depreciated (lower and honor or esteem), done with little effort, or inferior quality.
  • Frugal: means an absence of luxury or simplicity of lifestyle is described with the words such as thrifty (good management), economical (lack of waste), or sparing (as in restraint).

What a difference a word makes!

The connotations are completely different. Cheap comes off as something very grudgingly given–even to yourself. Frugal on the other hand comes off as something carefully chosen and executed.

Frugal is cool. Cheap is definitely not.

Wouldn’t you say there is a massive difference between the two? Do you have frugal or cheap habits?

Frugal vs Cheap: The Happiness Factor

Most people don’t like to be considered frugal because they equate it with being cheap. I believe it isn’t about being frugal or cheap. It is about putting the things that make you the happiest on top of your list of priorities.

You can’t have everything that makes you happy, but you can have some of those things.

Unfortunately, I believe most people don’t take the time to understand their own motivations or what makes them truly happy. They fill their time shopping for things to fill the space in their homes or buying “toys”.

Have you taken the time to get to know yourself? Have you ever given thought to your values?

Do you know which activities bring you joy?

How do you handle the things that bring you joy? Are you frugal or cheap?

Frugal vs Cheap: Entertainment

Is the whole movie theater experience something that brings you joy?

Going to the movie theatre is not considered frugal. Because there are economical options available. I’m thinking that even with the matinee prices, there will be a camp of frugalists who will claim this is not frugal enough!

However, let’s say you have a passion for going to the movie theater. You want to see all the movies that will be nominated for the Oscars because they bring you joy.

Are you frugal or cheap? In this case, we could default to the happiness factor.  So off to the movies you go!

Going to the movie theater can cost you more than a pretty penny. In addition to the ticket, will you want a warm tub of buttery popcorn? Nachos or a fizzy soda? A box of candy?

Question: Is it frugal or cheap to smuggle your snacks in with the idea of saving a buck?

You might be surprised to find there is some controversy over this seemingly small matter. There are those who claim it is okay to smuggle snacks because they are appalled at how expensive they are.

Others say you should not smuggle snacks in because that’s a way the company creates profit and it’s your choice to attend the movie theatre.

Which camp are you in? Have you ever smuggled snacks into the movies? How did you view your actions? Frugal or Cheap?

Question: Is it frugal or cheap to hack into your neighbor’s wifi account? Or use a friend’s HBO password?

Hands down, this is considered to be cheap.

Besides the movies, there are other options to consider for frugal entertainment. Many cities have free movies or concerts in the summer. Museums typically have a free entrance every month. The zoo has a free or half-price day every week.

The library hosts various programs (including book clubs). State or National Park memberships are very economical. There are also parks with hiking trails. Last but not least, organize your own event with a group of friends (think potluck, game night or projecting movies on a wall).

Frugal vs Cheap: Save the Date

Your best friend is getting married on the lush, tropical island of Guam in eighteen months. Quick answer and don’t think: Are you going? Are you frugal or cheap?

Yes, that was a trick question. I mean the answer could be very tricky… like walking across a minefield depending on who you are talking to.

I’ll admit it. My wife saves me from a lot of cheapness. If I were single, I would stay home with the excuse of having to work.  However, when you have a partner to consider, they will have a different plan!

My plan would have been to skip the wedding (and save myself a bunch of money). However, if you skip the wedding you risk being seen as cheap. You also risk offending your friends!

There is a frugal option. Frugal might mean going but finding a great deal on airfare and hotels. It might mean making sandwiches and cooking a few simple meals in your hotel room.

This is worth the expense and effort. And keep it in context. We are talking about your best friend–remember?

Frugal vs Cheap: Around the House

If you are like me you are always looking for ways to cut expenses around the house. Two good places to cut are utilities and food costs. Let’s look at how we can lower these two costs.

The utilities are pretty simple to lower. Here are a few of my favorites:

  • Turn off lights
  • Install ceiling fans
  • Wash clothes on cold
  • Lower your thermostat
  • Unplug electronics when they are not in use

The electric companies usually have tips for saving money on your bill. Check out your electric and water companies’ websites and the internet is jam-packed with lists for ideas on cutting utility bills.

The next place to make cuts is on your grocery bill. Two good places to buy ingredients for meals at home are Aldi’s (no-frills grocery store) and Walmart.

  • Cook at home
  • Bring your own lunch
  • Plan meals ahead of time
  • Carry snacks to tide you over
  • Do weekly or monthly cooking so you can grab and go/batch cooking

Consider how much extra money you spend at restaurants. The same food is made at home for a fraction of the cost.  As motivation to cook at home think about the enormous savings over time!

Question: Do you smuggle your alcohol into sports events or other entertainment venues? Do you consider that frugal or cheap?

I hate to break the news to you but smuggling your alcohol into events could be considered cheap. We will say it’s frugal to drink before you go out, as long as you have a designated driver.

Getting pulled over for a DWI is the opposite of frugal in this scenario and will probably blow your budget!

Frugal vs Cheap: The Outfield

The outfield is all of those other categories where we spend money. As we go through them consider if you have been frugal or cheap in these areas.

The Gym

Have you given up the membership to your gym to save money? Stopped taking the yoga classes that gave you a workout and relieved stress?

It’s actually frugal to spend money on your gym membership. You’ll save money in the long run. The gym adds value as a stress reliever, and mood-lifter, increases your energy, and lowers your risk of chronic disease.

Not working out causes you to spend money in the long run.

So, you save money on future doctor bills and you get physical and mental benefits. I’d say that is a win-win situation!

Bonus tip: Your health insurance will subsidize your gym membership sometimes.


Is buying low-quality clothes frugal or cheap? I am guessing you knew what the answer was going to be! Buying low-quality clothes is a terrible ideal. They fade, shrink, tear, and lose their shape. A good quality item of clothing can last years.

Question: Have you ever bought something, worn it for a special occasion, and then returned it? The answer to this question would be you are cheap. Instead of going this route, you could buy from consignment stores or rent for special occasions.

Buying cheap clothes or cheap anything that needs to be replaced shortly after the purchase is a waste of time, money, and energy. It is much better to spend more money upfront and the item will last for the long haul.

As we move into talking about gifts, keep in mind that a quality piece of clothing is a gift that will keep giving for a long time (unless it’s for a growing child!).


Question: Is re-gifting the candle you were given at Christmas frugal or cheap? This is a gray area. There are some that consider it cheap. There are others that consider it frugal but thoughtless.

What are some frugal gifts you ask? That depends on how handy you or your spouse are. There are hundreds of frugal gift ideas. You could design a personalized t-shirt (Cafepress), Custom painted wine glasses, and a bottle of wine, Netflix, or Amazon Prime subscription.

For the person who has everything, the gift of time is the best of all. Create custom coupons for the person to redeem.

So, you know that your mother, wife, and Aunt Maude have birthdays every year. There is also Christmas to save for. Plan ahead and pre-fund an account for gifts to remove the stress of gift-giving.

Speaking of gifts, instead of your child getting overwhelmed with toys on birthdays, sign up for a College Backer account. You can put the link on birthday invitations and guests can put whatever amount they wish into the college fund. Anyone can open an account at College Backer for $20.


Electronics is another area where quality counts. You might need to do some research but buying something quality in this category is a smart idea. Check the prices at multiple stores. Sometimes companies offer promotions when you buy it online. Take advantage of the manufacturer’s rebate.

Question: Do you consider it frugal or cheap to watch your data like a hawk? Surprise! That is stressful and cheap! The best thing you can do is shop around for a good service that costs less. It is frugal to switch carriers

My wife and I went with GoogleFI and save money on our cell phones. Our phone bill for the two of us is under $60. You can check out the deals here: FinancialResidency/Google.

Electronics are an area where you might be tempted to go cheap. However, it may be better to look for a deal and buy a quality product!

Frugal vs Cheap: Gone Wrong>

Are you thinking about saving money constantly? Do you go to extraordinary lengths to make small savings? If you can answer “Yes” to these questions and the ones sprinkled throughout this blog–you are a cheapskate.

Does someone else pronounce you frugal or cheap? That determination is for you to make. You also don’t have to take on someone else’s belief about your spending habits. However, your gut will tell you the truth.

The frugal thing to do is figure out:

  • How to save money and reach goals
  • Having experiences/keeping others happy

Keep in mind that being cheap does have a price and more than likely you will pay it!

It is not too late to examine your spending habits.

You can become frugal–not cheap!

What are your opinions on being frugal or cheap? Find the Financial Residency Podcast but first, subscribe to the show!