I was reading another personal finance blog the other day and the writer was telling about how he had saved a LOT of money in a little bit of time. Several hundred thousand dollars in just five years.
It was a cool and inspiring post, but as I read deeper into his techniques for increasing his saving I realized via some photos he had shared that he had definitely crossed the line from “frugal” to “cheap” in his pursuit of wealth.
While being cheap can have its benefits, the dangers far outweigh them, in my humble opinion. Let’s talk about some of the ways crossing that line from “frugal” to “cheap” can cause problems.
You Can Endanger Your Health
One area I see people abandoning frugal for cheap is in the area of health and health care. There are several ways “cheap” can play out here to cause you harm.
- You could cause injury to yourself by not spending money on important safety items. For instance, if you wear your shoes until there’s no sole left you could cause injury to your foot, leg, hip or spine. Or if you refuse to spend money on a safe vehicle you could end up seriously hurt if an accident occurs.
- You could exacerbate a health problem by refusing to go to a doctor.
- You could endanger your health by refusing to spend money on vegetables and other quality foods and only buying cheap substitutes like ramen.
There are ways to eat healthy for cheap. I know because I’ve fed our family of six quality, healthy meals for less than $500 a month for nearly five years straight now.
Taking care of your health is vitally important to enjoying the wealth you are accumulating, so make sure to think big picture as you’re working to save money in this area.
You Can Offend Your Loved Ones
Sometimes cheapness can really tick off those around us. For instance, if your family is a gift giving family and you avoid spending money on a gift and give your nephew a used 1980’s t-shirt for his birthday, or your refuse to pay your share at a restaurant, you might start creating resentment in those close to you.
Now, there are ways you can be frugal in your discretionary spending and gift giving as well, and not come off like an uncaring, selfish cad.
As an example, how about a gift certificate for that nephew that involves spending the day with him. You could go to the park, have a movie night at your house or go rock hunting or geo-caching.
Or if your friends like to gather for restaurant meals frequently, why not suggest a potluck instead? Or if your family is planning a group vacation destination, why not do some research on some great vacation deals?
The fact of the matter is that sometimes you’re going to have to spend some cash to keep the family/friend peace, but that doesn’t mean you can’t work with them to suggest more fiscally responsible options.
It’s okay to share that you’re working toward some financial goals and to put some limits on your spending, but sometimes you might have to pony up the cash for something that’s important, and that’s okay.
You Can Miss Out on Some Great Times
Those of us who are personal finance nerds can often get really tunnel-visioned when it comes to reaching money goals. I remember during our first year of debt payoff, I was on a serious roll. I had to be, given we had a DTI of 65%.
We had started in January of 2013 and for six months we were so frugal that we’d spent a total of $386 on entertainment for our family of six. That equals about $65 a month. I was still worried that this was much too much money given our situation and so when an opportunity to go to a classic car/plane show came up, I turned it down.
There was no cost to attend the event – I just didn’t want to spend the gas to drive the 15 miles there and back. Yep, I had become a serious cheap-arse. After some rebellion from my husband and kids, we went to the show.
It was SO much fun. We had three to four hours of complete bliss, oohing and ahhing at the hundreds of classic cars and planes. That event ended up being one of our best family members of 2013. And it taught me to not be such a tightwad that I lost sight of what our real goal was: being fiscally responsible without putting money above people.
You Can End Up Costing Yourself More Money in the Long Run
Sometimes being cheap can end up costing you more money over the long haul. For instance, like when you avoid getting that minor roof problem repaired because you don’t want to spend the money and the ensuing water intrusion causes a whole lot more problems that need to be repaired as you put off fixing the roof.
Or when you refuse to spend money on new running shoes and end up with a massive doctor bill from an injury sustained from wearing less than optimal footwear.
Frugal, Absolutely. Cheap, No Way.
I’m a big believer in frugality, and I pride myself on cutting spending wherever I can in order that our family can reach its financial goals.
However, when you cross the line over into cheap, you can cause some serious problems. I remember watching an episode of extreme cheapskates where a middle-aged mom invited her son, daughter-in-law and toddler-aged grandchild over for dinner.
Among other not-so-inviting meal selections, she served a cake that she had snagged out of a dumpster behind the local grocery store – it was a day-old item the store staff had tossed.
While her creativeness was to be admired, it was clearly obvious that her family did NOT appreciate being offered dumpster finds for dinner.
If you’re looking for a cheap dessert to serve, forego the dumpster finds and cook up some cake or brownies from scratch. You can do that for under $2 if you find the right recipe. You’ll still be acting frugally, and avoid the risk of forever alienating your loved ones.