Are You Frugal or Cheap?
It seems that when it comes to money, many people fit into one of two groups: those who carefully count and save every penny they earn, and those who blow through their paychecks so fast they hardly know what hit them. In writing about money, I’ve spent a lot of time watching how other people talk about, spend, and manage theirs. And while the term “frugal” has become chic in recent years, it’s my observation that some people take it too far — way too far. While I do my best to avoid debt, put away for retirement, and save money where I can, I have no interest in shivering through the winter under a single light bulb just to keep my costs down — and boy am I grateful that I have the luxury to make that choice.
When frugality is a means to an end — a way of achieving stability and working toward future goals — it’s a good thing. But when it crosses the boundary of common sense and logic and takes a turn toward the obsessive, it’s described by a less gracious term — cheap. (See also: A Beginner's Guide to Frugal Living)
The Purpose of Frugality
So what’s the difference between frugal and fanatical? I think motive’s a good indicator. In my own experience, I find that thrifty people have a number of motives that help keep their spending under control. For example, I once met a young woman who would work like a dog for months at a menial desk job, living in a tiny apartment for next to nothing. Meanwhile, she was socking away cash, which she’d use to spend several months traveling in a foreign country. When she ran out of money, she’d start all over again. While this kind of lifestyle isn’t for everyone, I admired her thrift, because it was a means to an end — she had a goal, and she made financial sacrifices to make it happen. That’s what money’s for!
But not all of the motives that keep people from overspending are positive. I’ve also met many people who just can’t bear to spend their money on, well, anything at all. It isn’t because they’re struggling to get by or are working away at paying off a mortgage. Instead, it seems that they don’t like the way spending money makes them feel, so they just save it (and save it and save it). I understand that some people are forced to live pretty spare lives for a number of reasons, which is why I find it so baffling that some people take this route by choice, often isolating themselves in the process. Yes, how you spend your money is up to you, but when those decisions are governed by guilt or fear, I don’t think it’s much of a choice.
Finally, there are a few people whose thrift goes beyond fear toward being truly mean spirited. You’ll know you’ve crossed into this territory when your savings come at someone else’s expense. These are the people who conveniently forget their wallets when they go out for lunch with a friend, never tip their servers, or show up at a potluck empty-handed. Some people might even cross the line into returning items they’ve had for years to the store to get new ones or stealing cable from their neighbors. The bottom line is that if you’ve cut your budget so much that you feel you need to take advantage of others, you’ve crossed line from frugal to cheap.
Which Side Are You On?
When it comes to people’s spending habits, I’ve seen both extremes, from asceticism to over-indulgence. I try to balance somewhere in the middle. Because while I’m so grateful to have money to spend on both the things I need — and a few things I don’t — frugality is a valuable skill to hone, especially in a world where so many people live paycheck to paycheck. But taking frugality to its extremes may be no better than falling prey to overspending. After all, neither approach leads to living well. And isn’t that what saving money’s all about?