There is this ugly reality we’re happily living in today. We often tag a frugal person as being cheap – miserly or stingy – because the two always try to save money.
But the question is, can you tell the difference?
It will interest you to know that the world’s greatest investor, Warren Buffett, is often labeled as frugal! This is a man whose net worth was estimated at $82 billion as of mid-2019. He can buy the world if he wishes! But, he is not that cheap.
A frugal person has good reasons for spending money. He thinks about what he would have left in his account if he should purchase a good or pay for a service. Without any doubt, this is also true of a cheap person. They both seek to save their money!
Does that mean they are the same?
And here is why –
Cheap people weigh a good by its price, frugal people consider the value.
Cheap people only think of the price of a good and fail to put into account other factors; such as value, durability and lifespan.
Yes, it is true they want to spend less but are they getting the best they can from the good?
For example, let’s say a pair of jeans; one from a marketer and the other from a premium store, costs ₦1000 and ₦2000 each. A frugal person will pay the extra money on the pair of jeans from the premium store because he believes it will last longer and not wear out easily. But a cheap person will not think the same way. To him, more money is saved by buying the cheaper one; which of course might wear out in a year or two.
Frugal people do research before buying items.
How will you know the best brand of a product, let’s say toothpaste, if you do not research about them?
Knowing fully well that there are Close-up, Oral-B, Pepsodent, etcetera on sales, a frugal person will look out for rebates, read reviews and take expert’s advice before going for one. Cheap people, however, will not see a need for it in as much as the lowest price and the basic model is available to them.
Frugal people prioritize their spending to save money; cheap people purchase more, and of low quality.
A frugal person understands that one’s standard of living is not equal to the cost of living. He believes spending more does not necessarily mean getting better value or living a better life. A frugal person is not an accumulator of the toys and other trappings of wealth. Cheap people believe ones wealth is in the quantity of what he acquires. So they buy more, of which most of the time, for bragging.
Cheap people complain about things being pricey.
Cheap people complain to everybody about the cost of everything. Although they may be right because frugal people think the same way about some goods too. But frugal people, rather than complain, will go for the next best option. Or why will you pay higher price for something of the same value you can get for less? Complaining about a good makes one look cheap especially if you do not know its value.
Cheap people are driven by saving money regardless of the cost.
Have you ever met a person who will not go to the doctor because he thinks it costs too much? How about parents who don’t buy workbook for their children because they believe it’s of no use? I’m sure your ‘yes!’ is as resounding as mine!
Cheap people hardly buy basic and necessities things of life. They would rather self-medicate than visit the doctor. Frugal people are not the same. They seek to get the best they can whatever they have.
Frugal people are not mean.
They teach others how to save money and purchase valuable goods. They also give to worthy causes like charities, indigent and family care. Cheap people, unfortunately, have a different mindset. They see their money as theirs, and theirs alone. They can afford to hold it for a lifetime even while on their dying bed.
Cheap people hardly care about others as far as they have some bucks saved for themselves. Money appears to mean more to cheap people than their relationship with others, family inclusive.
From the differences highlighted above, you will admit that frugality and cheapness are totally not the same, although there are no scientific proves yet. Perhaps the best distinction comes from understanding VALUE.
That you spend less does not mean you are frugal; you might just be doing yourself more harm than you could save. Anyone who is willing to sacrifice quality, value and time in order to cash in on some short-term savings is cheap. They are often afraid to spend money. The frugal are resourceful with their spending, they maximize their money, and they do not hesitate in getting the basic necessities of life for themselves.
So yes, there is a fine line between a cheap and a frugal person. The side on which you fall can make all the difference.