Frugal vs Cheap – Which One Is Best?

We hear the words “frugal” and “cheap” tossed around interchangeably quite often. Growing up, I thought they both meant the same thing. Now I know better. There’s definitely a difference in someone that is frugal vs cheap. If I had a choice, I’d rather be around someone that’s frugal and avoid the cheapskates all together.
Let’s take a look at what those differences are and then you can decide which you’d rather be like.

Frugal vs Cheap


According to Dictionary.com, frugal is defined as being economical with regard to money or food. You’re making measured decisions that provide a benefit to you. You’re not wasteful.

Frugal people understand that paying more doesn’t necessarily mean better value and may do everything they can to save money when it only affects themselves.

I don’t get into politics on this site, but do like a quote from Joe Biden where he stated, “Show me your budget and I’ll tell you what you value.”
It means our purchase decisions show what we value. We spend the most on what is most important to us.
Our family loves to travel so that category in our budget is typically the highest.

One of the main differences between cheap and frugal people is that they both love to save money, but frugal people will not do so at the expense of others.

Here’s a few examples of frugality:

  • Frugal people typically will buy “used” vs “new”
  • I read about a woman who only wore six items of clothing each month to save money for a year.


If you’ve read The Millionaire Next Door, then you know that one of the main characteristics found in most of the millionaires surveyed was frugality.

They believe that it doesn’t matter what you make, it’s what you save.

Being frugal to them means not trying to keep up with the Joneses and living well below their means. Once they become wealthy, they continue to practice living the “stealth wealth” life.

People that are frugal do everything they can to avoid debt.

JD over at Get Rich Slowly shared frugality advice from a couple of millionaires:

Avoid Debt

Derek Sivers is a millionaire who started out very meekly in his financial life. In his 20’s, he lived off of $12,000 in savings for years, then felt rich when he secured a job that paid $12,000 a year. Even though he’s a millionaire now, he says he continues to live a frugal lifestyle. Here’s what he says about debt in general:

I’ve always been very debt-averse. I don’t like being in debt at all, even on the small level. I never bought anything with a credit card unless I had that much money in the bank. The credit card was just a convenience. I never went into negative debt on a credit card, even as a teenager because I just hated that feeling. They say that there are two ways to be rich: one is getting more money, and the other one is lowering your expectations, lowering your needs.
Be Value Conscious

Todd Tresidder is a financial coach who made the majority of his money through smart investments. Here’s how Todd says he saved so much money:

I think…it comes back to values. You just have to not have an interest in buying lots of stuff…I was a single, young man, not too far out of college and my mom would get on me. She’d say, ‘Todd, you’re making all this money, why don’t you go buy yourself a Corvette? Go get yourself a flashy car.’ But I lived in Lake Tahoe. I’m an outdoor recreation buff…I’d play volleyball down on the beach; mountain bike in the hills. I run.


Cheap, on the other hand, is often viewed negatively. A cheap person is someone who doesn’t like to spend money and complains all of the time about how much things cost.

They’re typically known for showing a lack of honesty and moral principles. When they try to save money, they don’t consider others in the process.


When I think of cheap, I think of two people: Scrooge and Jeff Foxworthy.

We all know the story of Ebenezer Scrooge who was a cold-hearted miser who despised Christmas. Shame on him!

He didn’t care about anyone but himself before his transformation towards the end of the show.

Jeff Foxworthy is famous for the “You Might Be A Redneck Jokes“.

Here’s a few that reminded me of cheap people…

You might be a redneck (cheap person) if:

  • You own a homemade fur coat.
  • You burn your yard rather than mow it.
  • You’ve ever given rat traps as gifts. (not a bad idea!)
  • You clean your fingernails with a stick.
  • Your coffee table used to be a cable spool.
  • The taillight covers of your car are made of red tape.
  • You have a rag for a gas cap.

Other cheap examples

Here’s a few other real examples of cheap people:

  • My aunt buys two ply toilet paper and separates the layers so the paper lasts twice as long.”
  • According to my Dad, my late uncle would allow the family’s one toilet to be flushed only once per week. Unless there were house guests.”
  • One girl I know reuses her dental floss!”

**BTW, if you EVER consider reusing your dental floss, do yourself a favor. After you use your floss once, smell it. It’s horrible. I couldn’t imagine reusing it. Ok, back to the article…

Here’s something else to consider. Some people claim that one of the ways they save money while eating out is to not leave a tip. It’s one thing if you don’t do it because of terrible service.

I get that.

However, if you refuse to leave one despite receiving average/great service, that would be considered cheap with disregard for others.

Which One Are You?

Now that you know the difference between being frugal vs cheap, which best describes you? Don’t know? Try asking someone you’re close to and I can guarantee they’ll know the answer.

If you’re still not sure which one you are, here’s a few ways to tell:

Money Management

Frugal people tend to be more skilled at money management vs cheap people. An example would be shopping for a refrigerator. A cheap person walks in and asks to see the cheapest refrigerators whereas the frugal person looks at value first.

They may want to compare which models are most energy efficient and last the longest. They may also want to research online to see what other people are saying about the models they are comparing.

Before making the purchase, the frugal folks will look for sales at other stores and rebate offers.

On the other hand, cheap people typically aren’t going to take the time to research the best, quality refrigerator when the cheapest, most basic model is in front of them.

You drive across town to save a buck

I admit, I used to do this because my dad did (and still does). I would drive 20 minutes across town to the Sam’s Club in order to save 10 cents on a gallon of gas. Now at first, that sounds like a big savings until you realize that filling up with 20 gallons equals a whopping $2 in savings. 

There’s nothing wrong with trying to cut costs on purchases, but where’s the savings when you drive 20 minutes for gas that’s 10 cents a gallon cheaper?

I get that I’m a slow learner but I finally realized later on in life that time REALLY is money.

We can make more money but not time. 

A Frugal Physician

If you’d like to learn more about frugality from another doctor, there’s an entire site dedicated to it that can be found at The Frugal Physician.