Being Frugal vs. Cheap

Updated: Nov 29

We've all heard of the words 'frugal' and 'cheap' and might be tempted to view them as referring to the same concept. But they are not at all synonyms, and understanding the differences between them can be very instructive.


The Cambridge Dictionary defines 'frugal' as being "careful when using money (or food)." One of the definitions it provides for 'cheap' is "unwilling to spend money."


There is a big gap between being careful when using money and being unwilling to spend it. To some extent, being careful with money is essential to living below your means (i.e., spending less than you earn) and building a secure financial future. If you are care-less with money, you are setting yourself up for a life of instability, perhaps even poverty, where you will be utterly dependent on your ability to continue to earn an income, and, when you lose that ability, dependent on others to help you get through life.


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But being careful with money does not mean being unwilling to spend it, nor does it mean always choosing options with the lowest price. Frugality is quite similar to value consciousness, which refers to consumers paying close attention to how much value (i.e., benefit vs. cost) they receive from their spending. Frugal consumers do not spend recklessly but rather consider the consequences of their purchase decisions. If they believe that a purchase will help them achieve their goals, they are willing to make it. But if a purchase would not provide them with meaningful value, they are apt to avoid it.


Frugal people carefully consider how their money may be used to help achieve their goals. For them, money is a means to an end.


Contrast such people with those who are simply unwilling to spend money. Even if a purchase would provide those who are cheap with significant value, they will often not even consider it. And when they are essentially forced to spend, they may easily do so from a short-term mindset, selecting the option that is the least costly now but will be more costly in the future. Those who are particularly cheap earn the moniker of miser, those who may go so far as to neglect the most basic of needs in favor of storing up money. Dickens' Ebenezer Scrooge is perhaps the most well known example, and he reportedly based the character on a real person. Those who are cheap may even ignore the needs of their so-called loved ones.


Being cheap seems to be driven by either of two motivations and perhaps both at times: greed and fear. They want to have as much for themselves as they possibly can, they are afraid of running out of money and so are loathe to spend it, or both.


Cheap people have made the accumulation of money their goal. For them, money is a means to an end that should be used with care.


The Bible has much to say on how we should use the resources, both financial and otherwise, we've been blessed with. It cautions against being wasteful or slothful.


When Jesus fed miraculously fed the multitudes, He specifically instructed his disciples to not waste the leftovers.


"And when they had eaten their fill, He said to His disciples, “Gather up the leftover pieces so that nothing will be lost.” - John 6:12


The book of Proverbs is full of counsel on taking care with what one has and not to squander it.


"There is precious treasure and oil in the home of the wise, but a foolish person swallows it up." - Proverbs 21:20


Christians should be especially careful to not be cheap when it comes to helping those around them. The 'good Samaritan' (Luke 10:30-37) Jesus spoke of spent significant time and money, more than two days' wages, to help the wounded man.


The apostle John warned Christians that holding back what we have from those in need, especially other believers, is indicative of a very serious problem.


"But whoever has worldly goods and sees his brother or sister in need, and closes his heart against him, how does the love of God remain in him?" - 1 John 3:17


And the apostle Paul warned us to not love money, which is merely a tool that can be used for good or ill.


"For the love of money is a root of all sorts of evil, and some by longing for it have wandered away from the faith and pierced themselves with many griefs." - 1 Timothy 6:10


We would do well to remember that money should only be treated as a means to an end, not an end in itself. That said, we should take care with spending our money, doing so when it will genuinely help us or those around us. Never should we hoard it, whether for greed or fear.

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