Have you ever noticed how we, as consumers, often interchange the words frugal and cheap for one another? While the line between being cheap versus being frugal can be thin, the thought occurred to us that there’s a world of difference between these two savings strategies. Continue reading as we highlight what makes them so different.
What the words “frugal” and “cheap” have in common is that they both represent ways that you can save money. However, this is where the similarities end. The reason is that they both represent two entirely different outlooks on life.
A good way to define cheap would be that cheap is when we make buying decisions solely based upon price. Another way you can say it is it’s when we refuse to consider any factor beyond price in our buying decisions. In essence, being cheap is the same as sacrificing high quality to pay a lower price without taking other things into consideration.
Taken to the extreme being cheap can mean going without something you need, just so you can save money. Or it could mean doing anything you can to get something for free. Over the long term, being cheap can sometimes cost you far more than you save. For instance, if you need a new air conditioning unit, a cheap unit may not be the right answer for you. You may spend more in electrical bills, future repairs and even have to get a new unit sooner than you would for a more high quality model that costs a little bit more.
Yet, there are some times when it makes sense to be cheap. For example, if you’re considering buying a tablet device to watch movies and play games, is it really necessary that you purchase the latest model? Every time a brand new model comes out the older ones are discounted, so it may make more sense to get the prior model. Even if you bought the newest tablet that cost $129 more than the one it just replaced, less than a year from now an even newer one will come out replacing today’s model.
Just as being cheap is about saving money, so too is being frugal. However, when you’re frugal you don’t just want to get any product for less but you want a quality product for less. This often involves the use of timing, coupons, rebates, sales and specials as well as looking for quality refurbished or second market items.
As you can see, there is more time and planning that goes into being frugal as opposed to the time that you’d have to invest to be cheap. However, there is an upside to being frugal; you’re still getting the things that you need or want but just at a reduced price.
For example, let’s go back to the same example from above where you’re in the market for a tablet device. Let’s say you need your tablet to run the latest productivity apps and high definition video without freezing. So instead of buying the older model that has less features, you locate the manufacturer’s official Ebay store and buy a refurbished model for a hundred dollars less than you’d get a brand new model at a big box retailer.
At the end of the day each way of saving money has its own set of advantages and disadvantages. The important thing for you to do when figuring out which way to go is to ask yourself if the route that you’re planning on taking will cost you money or save you money – over the long run.
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