Frugal vs. Cheap: Which One is Right for You?

Elena Hudgens
By Elena Hudgens 23 Min Read

Many of us strive to live a financially responsible life, but it can be hard to know when we are being sensible with our money and simply being too tight-fisted. Learning the difference between frugal vs. cheap can help you understand how to stretch your budget further without sacrificing your lifestyle. 

In this article, I will explain frugal vs. cheap and provide tips on how to live a financially responsible life.

What is Frugal Living?

Frugal living is a lifestyle focused on reducing spending to increase your savings. It’s about making conscious choices to reduce your spending. It often involves finding low-cost alternatives to expensive services and items. 

Frugal living is often associated with a minimalist lifestyle. As you reduce your spending, you increase your savings. This can help you reach your financial goals, including paying off debt or retirement savings.

People who follow this lifestyle often avoid buying things they don’t need, like expensive clothing and electronics. Instead, they try to find low-cost alternatives that get the job done. Some frugal habits include clipping coupons, shopping at thrift stores, using public transportation, and meal planning.

What is Cheap Living?

Cheap living is an extreme version of frugal living. Rather than cutting back on expenses and looking for cheaper alternatives, cheap living entails spending the least amount of money possible, even if it compromises quality.

That is buying the most inexpensive item you can find regardless of whether or not it is of good value. Cheap living often involves finding ways to reduce your spending while still buying affordable items that aren’t worth their low price. 

Some cheap living habits include buying generic items, buying things past their expiration date, and refusing to buy anything new. 

Cheap living often goes hand-in-hand with highly frugal living. These strategies can be helpful if you’re trying to save money, but they can also lead to bad financial decisions.

Frugal vs. Cheap: What is the Difference?

Frugal and cheap are often interchangeable but represent two very different financial philosophies. 

Being frugal implies making intelligent financial decisions that allow you to get the most value for your money. On the other hand, being cheap implies getting the most affordable possible option, regardless of whether it is of high quality or not. 


Being frugal is about finding ways to save money without sacrificing quality. It’s about being selective about purchases and spending your money wisely. Frugal living is about making the most of what you have and not going into debt to buy things you don’t need. 

On the other hand, being cheap is about making poor financial decisions and spending money on anything you don’t need. While being frugal might mean buying used items, cheap is buying the most inexpensive new things you can find, even if they are low quality.

Frugal Vs. Cheap: Pros And Cons 

Let’s examine the pros and cons of frugal vs. cheap living one by one!

Pros and Cons of Frugal Living

There are numerous benefits and drawbacks to living a frugal lifestyle. Not only will you see positive changes in your bank account, but you will also find yourself busy with so much work. 

Here are a few pros and cons of frugal living. 

Financial Security
Achieving long-term financial security is one of the primary benefits of frugal living. By focusing on your spending habits, you can save money towards savings goals, like paying off debt or saving for retirement. 
Less Prepared for Financial Emergencies 
While it’s essential to make sure that you prepare for potential financial hardships, it’s also important to note that you don’t have to have all of your money in savings at once.
 Although frugal living can help you save money, it won’t always help in having some cash aside for unexpected expenses.
Improved Health 
Healthy living is essential for everyone, and living frugally can help you to prioritize healthier food options and avoid unnecessary spending that could affect your health in the long run
Less Socializing 
One of the biggest cons of frugal living is that it can require you to cut back on the amount of money you’re spending. This may mean less socializing, less money to spend on experiences, and fewer options when it comes to travel. 
Stress Reduction 
If done properly, Frugal living is about mindfulness when it comes to spending your money. This means being present in your purchases rather than mindlessly shopping as you have money to spend. 
This can help you to reduce stress by avoiding the trap of shopping when you’re feeling blue. 
More Work 
Frugal living can help you save money, but it can also mean more work if you’re trying to compensate for the lack of purchasing power that comes with frugality. 
For example, a frugal lifestyle may require you to clean your house, do your yard work, and fix your things rather than hire someone to do those things for you.

Pros and Cons of Cheap Living

Several benefits and drawbacks can come from living a cheap lifestyle. Here are some pros and cons of cheap living.

Increased savings 
Those who live on a budget have significantly higher savings rates than those who don’t. 
Limited Options
Cheap living limits your options. You have less freedom to choose whatever you want. 
You’re cutting costs, so you cannot spend money on things you might need. This suggests you cannot enjoy certain luxuries, such as dining out.
More flexibility 
It is easier to adjust as necessary if you live on a tight budget. This can be a massive advantage if you face financial difficulties or unexpected expenses. 
Unpleasant Experiences
Another con of cheap living is that you may experience more unpleasant situations. This is because you’re often making sacrifices for the things you do have. 
For example, you may eat out less often at restaurants as it is expensive. This implies that you might eat in less comfortable restaurants or with less enticing food.
Avoid Lifestyle Inflation
Lifestyle inflation occurs when your spending slowly increases over time without you realizing it. This can lead to needing more money to fund your lifestyle. Cheap living can help avoid this by keeping your spending low. 
Social Pressure
Cheap living can also put you under social pressure to keep living frugally. This means you may have to justify your spending choices. 
Or, you may feel like other people expect you to spend as much as possible. This can be challenging if you don’t have the skills to explain why you’re making certain. 

There are a lot of pros and cons of cheap living to consider before diving in. On the one hand, it can be a great way to save money and live on a budget. On the other hand, it can be challenging to maintain and may require sacrifices. 

Frugal Vs. Cheap: Examples of Frugal Living

There are plenty of examples of frugal living, but these are some of the best. Anyone can make a frugal living. It doesn’t matter if you’re rich or poor, young or old, or live in the city or the country. You can be frugal no matter who you are or where you live. Here are a few examples of frugal living. 

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1. Clipping Coupons

Using coupons is one of the most common ways people practice frugal living. The coupons don’t just allow you to buy items for less; they also make you more likely to buy something you need. 

2. Using Public Transportation

If you live in a city, public transportation can help you save money. 

3. Eating at Home

Eating at home can reduce your spending on groceries compared to eating out and help with portion control.

4. Using Free Resources

You can take advantage of plenty of free resources, from online courses to free events in your city.

5. Shopping Second Hand

Another great option to save money is to shop secondhand. You can find plenty of great deals at thrift stores, and even eBay can be a great place to find deals. You can also sell old clothes and furniture you don’t use anymore to make even more money.

Frugal Vs. Cheap: Examples of Cheap Living

Here are some examples of short-term financial decisions that are likely to result in unnecessary financial hardship.

1. Saving money by buying low-quality items

Spending money on low-quality items likely to break or wear out quickly will likely result in wasted money.

2. Ignoring your health

Choosing to ignore your health through poor eating, exercising, and sleeping habits will often result in higher medical bills.

3. Spending too much on rent or a mortgage

Renting a place that is too expensive for you will likely result in wasted money. 

4. Holding onto money that you don’t need. 

Keeping money you don’t need will often result in taking advantage of opportunities to earn more.

5. Buying Generic Items

Some foods and products have almost the same ingredients and nutrition facts as their more expensive counterparts. Even though they’re almost always cheaper, they might have a past expiration date.

Tips For Being Frugal Or Cheap

People with frugal and cheap lifestyles may have different motivations and ways of achieving their goals, but both try to save money. Whether your living is frugal or cheap, the most important thing is that you’re consistent in your approach.

  • Be selective about what you buy. Frugal people are more likely to buy high-quality items that last, while cheap people are more likely to buy cheap things that don’t last very long. Be sure to consider quality when shopping to save money in the long run. 
  • Pay attention to prices, but also value. Frugal people may pay the total price for high-quality items, while cheap people may buy cheap items even if they have a lower value. Make sure you consider cost and value to get the best deal. 
  • Shop at places where you can take advantage of sales and discounts. This can help you save money without being cheap. 
  • Avoid getting into debt. This is especially important if you’re frugal and buy high-quality items. 
  • Take care of yourself and your things. This can help you save money by making them last longer.
  • Consider the long-term benefits of being frugal or cheap. Even though frugal people may pay more upfront for high-quality items, they may save money over time. 
  • Be flexible and willing to change. No matter your approach, you’ll likely have to adjust your strategy from time to time.
  • Saving money is important, but taking care of yourself physically, emotionally, and mentally is essential. 

Consider which approach best fits your personality. If you’re more frugal, don’t try to be cheap just because it’s more popular. Remember that being frugal or cheap doesn’t make you a better person. Worry less about what approach is correct and more about what works best for you. 

How To Strike A Balance Between Frugal And Cheap?

Now that you understand the pros and cons of being frugal vs. cheap, you might wonder how to get a balance between the two. The first step for this is to figure out where you are now. 

Are you frugal or cheap? Once you know where you stand, moving towards a more balanced approach will be easier. Here are some tips for balancing frugal and cheap:

1. Figure out which category you fall into. 

As discussed above, being frugal and cheap are two very different ways to spend money. Once you figure out which one you are, moving toward the other side will be easier.

 2. Set some financial goals. 

Whether you want to pay off your debt, save money for retirement, or work towards a large purchase, it helps to have a goal. Setting specific goals will help you move towards a more balanced approach while still focusing on the factors that are most important to you.

3. Focus on making small changes. 

Trying to change your entire approach to managing your finances overnight is almost always a bad idea. Instead, focus on making small changes for the better over time, and you’ll end up with a healthier approach.

Which One is Better?

Frugal living and cheap living are two very different approaches to saving money. While each approach has pros and cons, frugal living is a sustainable way to improve your finances. It is a lifestyle choice that allows individuals to enjoy a comfortable standard of living while still saving money. 

On the other hand, cheap living is a powerful way of life focused on the minimal spending necessary to survive. 

While both methods of living can help you save money, you will get the most benefits from frugal living. 

Tips For Being Frugal Without Compromising Quality?

One of the biggest misconceptions about frugal living is that it is synonymous with cheap living. While frugality is about spending money wisely and not being wasteful, it does not involve cutting back on quality. It is important to remember that you don’t have to sacrifice quality for the sake of saving money. 

There are numerous methods to be frugal without compromising quality. Here are a few tips for being frugal without compromising quality. 

1. Buy in Bulk

Consider buying a larger quantity if you see an item you like but is priced above your budget. For instance, if you like to buy a branded coffee priced out of your budget, consider purchasing a larger bag of coffee beans and grinding them at home. 

2. Look for Discounts and Rebates

There are plenty of options to save money without having to compromise quality. Look for discounts and rebates on items you regularly buy. 

3. Do Your Research

Always do your research before purchasing an item. Be sure to look at different brands and compare their quality.

Tips For Successful Frugal Living

If you want to save money and live frugally, you can do a few things. Here are some tips for successful frugal living. 

1. Set a Budget 

The first step towards successful frugal living is to set a realistic and achievable budget. You can do this using a budget planner, spreadsheet, or money management app like Mint or You Need A Budget. 

2. Be Selective with Your Spending

While it is essential to set a budget, you should also be selective and spend only on necessary things.

3. Prioritize Saving Money

While it is important to set a budget, it is even more important to prioritize saving money over spending it. You should put enough money into your monthly savings account. 

4. Be Prepared for Unexpected Expenses

No matter how meticulously you plan your budget, unexpected expenses will always be. You must make sure you have a healthy amount of money in your emergency fund to deal with these unexpected expenses.

Common Mistakes People Make When Trying To Save Money

While the benefits of frugal living are endless, people commonly make a few mistakes when trying to save money. Here are a few mistakes people make when trying to save money. 

1. Cutting Out All Luxuries. 

One of the biggest mistakes people often make when trying to save money is cutting out all luxuries in their lives. While it is crucial to make wise spending decisions, it is also essential to enjoy the little things in life. 

2. Ignoring Your Credit Score. 

Another common mistake people need to pay attention to when trying to save money is ignoring their credit score. Your credit score can significantly impact your ability to get approved for loans and other types of financing.

3. Not Saving for Emergencies. 

Another mistake people make when trying to save money is not saving for emergencies. You never know when an emergency will pop up in your life, so it is essential to have money set aside for these situations.

4. Saving Too Much. 

While it is great to save money, you don’t want to save too much and end up living a miserable life. It is essential to living in the present and ensure you enjoy the little things in life.

Ways To Make The Most Of Your Budget

Frugal living is about making wise spending decisions, but it is also about staying motivated. Here are some ideas to maximize your spending power and maintain your goal of saving money

1. Create a Budget. 

Making a budget is one of the first steps to maximizing financial resources. You can use an online tool like Mint to help you create a budget in a few simple steps. 

2. Prioritize Saving Money. 

Another thing you should do to make the most of your budget is to prioritize saving money. Make sure you prioritize your budget savings to have enough money to reach your savings goals. 

3. Avoid Luxury Spending. 

It is vital to avoid luxury spending while still ensuring you enjoy the little things in life. Be sure to prioritize your needs and ensure you are not overspending on luxuries. 

4. Get Help When Necessary. 

It is okay to ask for help when necessary, and you are drowning in debt. Many people are willing to help you get out of debt, so don’t hesitate to ask for help when needed.


Frugal living and cheap living are both strategies to have money. While helpful, it’s essential to understand the difference between frugal and cheap. Frugal Living focuses on reducing spending and finding low-cost alternatives. It’s about being mindful of your spending without avoiding purchases. 

Cheap living, on the other hand, is about spending as little money as possible, even if it means skimping on quality. These two strategies can help you save money but can also lead to bad financial decisions if you’re not careful.


Frugal vs. Cheap; What is the difference between them?

Being frugal is concerned with not being wasteful, and being cheap focuses on getting the lowest price.  

How to be frugal without being cheap?

  1. Eliminate monthly subscriptions.
  2. Reduce prescription costs.
  3. Buy used items.
  4. Purchase at the right time.
  5. Buy high-quality products

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Elena Hudgens is an entrepreneur with 10+ years of experience. She started her journey by building her own e-commerce website on Shopify and turned her $1000 savings to millions in just 2 years. Soon she started different ventures in which she failed and succeeded. And now, she's on a mission to help other entrepreneurs with her life and business lessons.
1 Comment
  • While the two terms may be mistaken for one another, “frugal” and “cheap” are not exactly interchangeable and have differences to consider. Thanks for sharing!

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