Frugal and cheap are often mistaken for synonyms, but the two couldn’t be more different. To be frugal is to find ways to save money or to spend money wisely with calculated decisions that don’t come from a place of impulsivity. Meanwhile, if you are cheap, it means that you find ways to save money at any cost, even if it’s at the expense of others. That’s where the two get maligned and in an effort not to seem cheap, people that want to live a frugal life feel socially pressured to prove they aren’t cheap. You’re savings journey and your financial health are your own and, just like your physical health, you must make decisions for yourself alone. At Factum Financial, we believe in frugality and in making smart decisions with your money, but we’ll never advise you to be cheap.

What It Means To Be Frugal

Being frugal means that you make healthy financial decisions and find ways to save money as long as you aren’t doing so at other people’s expense. For example, a frugal person might find a book in a used book store that they really want, but check the Amazon price listing and find the book cheaper online, so they choose to wait a little while to get something they want. Frugal people don’t buy the cheapest product they can find and sacrifice quality, meaning that items like clothing or shoes might cost a little more, but frugal people recognize those things as long term investments. Frugal people are really looking for long-term value rather than short-term savings. This is the mindset you should strive for: always conscious and protective of your money, but never sacrificing your time to jump over a dollar to save a dime.

What It Means To Be Cheap

Being cheap and being frugal are not the same thing. People that are cheap will find ways to save money, even if that’s at other people’s expense. Cheap people find ways to save money, no matter the consequences, even though they are often unaware of the consequences of being cheap. Not only is being cheap not necessarily better for your finances, but it could be detrimental to your health. Cheap people are more likely to purchase the least expensive foods, which are often over-processed and could result in multiple health problems. Since many people that are cheap see going to the doctor as an unnecessary expense, they may leave serious health problems undiagnosed. When you consider how much less you might save in the long run by being cheap, perhaps it’s better to adopt a more frugal mindset. Also, are we really enjoying life when we are living with a scarcity mindset or just being cheap? A lot of times, putting forth the savings effort to buy the thing you really want or spending the money on the vacation you’d love to go on will give you an emotional win that is hard to put a price tag on.

Supporting Your Financial Health

We understand the desire to save money at Factum Financial and we share that desire. Every effort that we make as financial educators is to show individuals, families and businesses how to make smart, frugal decisions with their money. Are you ready to start living the financially healthy life that you have imagined, where you always have the money for the big things you want to purchase or for immediate needs or even for that dream vacation your family wants to take, without having to nickel and dime every purchase you make? Let us help build your plan and your cash flow system for a smart financial future. Contact our wealth strategist team today to get your no-cost wealth strategy session scheduled today.

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