My Uncle once referred to me as the cheapest rich person. Hahaha, While I don’t consider myself “rich” or “cheap” I do consider myself frugal. I’d like to use the word frugal rather than cheap. I do remember as a child my dad would talk about how he tried to live frugally. I remember him fixing things, rather than buying new ones. I’d like to think I learned a lot from him on how to be resourceful, save money, and be intentional with how I spend money. To me, frugal is all about being intentional with how money, time, and resources are spent.
I once heard someone use the term “false frugality” in which you were convincing yourself you were being frugal, only to piss away money in another area. An example of this false frugality is a person who would drive across down to save three cents on gas, while the time and fuel spent to drive across down cost you money, or at the very least cause you to break even.
Another example of false frugality is when someone buys something on sale, on clearance, or marked down. Wow! I saved 30%, 50% or even 80% off of the original price of the product. Only to find that you may not use, or haven’t needed it in the first place. Before I started my FIRE journey, I remember donated clothes my wife had purchased that still had tags on them.
As I had talked about before, it’s is all about spending your time and money on what you value. This can TOTALLY be subjective. And to me, time is huge importance to me. This the most valuable resource we have. A good example of this is one of my daughters need to get an oil change for her car. She told me, Uncle Jim will do for free, if she just stops at O’Reilly and picks up the oil, filter, and stuff. It cost $32 for the supplies alone. We can use a $10-off coupon and pull into a Valvoline Rapid Oil Change and have it done in 15 minutes for the same cost, and I didn’t have to hassle with disposing of the old oil. I’ll gladly pay for this convenience and saving so much time rather then me or Uncle Jim doing it myself.
Let’s look at some other examples. Are these Cheap, or Frugal?
Is it cheap or frugal to spend .99 on a 24oz gas station Coffee with Sugar-Free Vanilla, Splenda and cream, vs. a 12oz Pikes Roast with a shot of vanilla for $3.00?
Is it cheap of frugal to use my re-usable 20% coupon a restaurant mailed to me?
Is it cheap or frugal to by brand new dress shirts or jeans from the Goodwill?
Let’s hear about your thoughts on what the differences are between being cheap or being frugal.