Frugal and cheap people both like to save money, but other than that, they are not the same. We know cheap people and they aren’t fun to be around.
Cheap prioritizes price no matter what, even at the expense of others. They will try to avoid paying their fair share when splitting a bill. They will sacrifice their time, health, and energy in order to save a couple of dollars, and sometimes bring other people down with them. And it’s very difficult for a cheap person to donate money.
Frugal prioritizes value. Money is an important factor, but so is quality, time, and well-being. It’s not about getting the lowest price, but getting the most for your money based on what is important to you. We all have different definitions of value, so this looks different for everyone. One frugal person may make coffee at home but go out for lunch regularly, but another might buy coffee every day but never go out for lunch.
Be frugal, but never be cheap. Spend money on what matters to you and save money where it does not. Find ways to earn higher income. Spend less than you make. And repeatedly invest the difference. You will lead a far happier and more fulfilling life than any cheapskate!
As always, reminding you to build wealth by following the two PFC rules: 1.) Live below your means and 2.) Invest early and often.
-Vivi & Shane