Cheap Vs Frugal: Wait There's a Difference?

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There is a misconception that being frugal is the same as being cheap. They are similar but VERY DIFFERENT, if that makes any sense.

So let’s take a look at the actual definition of each (according to

Cheap - miserly; stingy.

Frugal - simple and plain and costing little.

Both cheap and frugal people love to save money. 

Being cheap is being afraid to spend your money at all costs. It can come at the expense of others. Have you ever been to a group dinner and had a friend leave the exact cost of their meal and drink (excluding tax & tip)? Now, the rest of the group is left to cover their portion of the tax & tip. Totally UNFAIR but this is the result of a CHEAP person. 

Frugal people are more resourceful with their money. They will not save money at the expense of others. Frugal people aren’t opposed to leaving tips or donating to their favorite foundation. Frugal people will cut in some areas but will spend on what they value. 

Cheap people will not spend on what they value, the goal is trying not to spend money at all.

Thank you to Ramit Sethi author of “I Will Teach You To Be Rich”, for providing some of the similarities & differences between cheap & frugal people:


  • Cheap people affect those around them. Frugal people only affect themselves.

  • Cheap people think short term. Frugal people think long term.

  • Cheap people care about the cost of something. Frugal people care about the value of something.

  • Cheap people don’t mind ordering a big meal and not leaving a tip. Frugal people will order a more affordable meal or skip a drink to save money for the tip.


  • Cheap & Frugal people both enjoy saving money.

There is a thin line between CHEAP and FRUGAL. People always mistake the two. The mistake does seem reasonable because they both are careful about spending money, but there is a distinct difference between the two.

In short, the difference is…

Being Cheap is driven solely by spending less.

Being Frugal is driven by prioritizing spending to pay for the things you care most about.

Be FRUGAL, don't be CHEAP!