Consumer Comeback Blog

The Frugal Lifestyle: How to Balance Cheap and Spendy

Written by Jeffrey Trull

frugal-lifestyle-cheapFrugality is often misunderstood. Some lump it together with being “cheap,” as in leaving small tips or stealing packets of ketchup. Others take the term to the opposite extreme by “saving” money by choosing the $20,000 new car instead of the $30,000 model.

While “frugal” is a subjective term, acting frugal falls perfectly in the middle of the two examples above.

Whether you think you’re already frugal or not, here’s how to find the balance between spendy and cheap and embrace a frugal lifestyle.

Don’t be a cheapskate

“Frugal” and “cheap” aren’t synonyms. According to, cheap in this context is defined as “stingy” and “miserly.” Frugal is defined as “economical in use or expenditure; prudently saving or sparing; not wasteful.” See the difference?

To be a little more clear as it relates to money, here’s behavior that could be considered cheap:

  1. Always choosing the lowest-priced option, regardless of quality or value
  2. Shortchanging others, like when splitting a group check at a restaurant and purposely not including tax and tip
  3. Refusing to splurge on anything, like going out to dinner, a movie, etc.

Those who are cheap might not have bad intentions. They’re doing a lot right to be perfectly frugal, but simply taking things too far.

Not cheap, not frugal

I’m not trying to discourage anyone who thinks they’re being frugal. But some who believe they’re frugal live paycheck to paycheck because they spend more than they need to.

Some warning signs you’re far from frugal (and may be in worse trouble) include:

  1. You buy lunch at work every day.
  2. You can’t pay your bills until the next paycheck comes in.
  3. You have zero retirement savings.
  4. You’ve never heard of an emergency fund, nevermind keep one.

Spenders need a reality check. They might think they save money here and there, but they’re likely living in denial if they think they’re frugal.

Getting started being frugal

Before you can be frugal, you need to understand what frugal is. Here are some examples of frugal behavior, compared to being cheap and spending too much.

When it comes to friends and family, letting a few dollars go here and there. Don’t pick up the tab every time, but don’t keep track of every cent, either.

Cooking a homemade dinner and spending $15 on a bottle of wine. Eating at home is often a “win” compared to going out, and $15 of wine isn’t going to break most budgets.

Clipping coupons, keeping a grocery list, and shopping mindfully at supermarkets is frugal. Spenders just buy whatever they feel like, never even comparing prices. Cheap people always go for the lowest price and never buy things they can get for free, like napkins, ketchup, and salt shakers.

See the the trend here? The idea is to embrace the middle of the road instead of falling to either extreme.

Once you’re ready to be frugal, it’s not as simple as just making the decision. It’s an entire lifestyle change and not something that just happens overnight.

So how do you work on being frugal? Start with what you want to accomplish.

Donna Freedman puts it best: “I save where I can so I can spend where I want.”

Decide what your goals are, or more specifically, where can you save so can afford to spend where you want and still be frugal.

For example, consider buying a used car instead of a new one. If you’re not a car person, the difference between choosing new or used might not make a difference but the savings will.

Maybe you don’t even like buying lunch every day. You just do it because it’s easy. Instead, you could make an effort to start bringing your lunch, even just one day a week. Doing that could save you $250 a year assuming packing your own saves $5 every time.

While you’re saving, don’t forget the good part: Spending where you want. This is the great part about being frugal instead of cheap. It’s about spending on things that you care about and love instead of not spending at all.

No one said you can never have dinner at an expensive restaurant. Don’t be afraid to splurge here and there.

Love taking a yearly trip to your favorite vacation spot? Go ahead. Being frugal helps you get there and still keep your other financial goals intact.

Where do you fall on the frugal meter? Have you ever struggled to keep a balance?

(image: jridgewayphotography)