Personal finance is personal – one person can choose vacations over a nice house whereas another person would rather keep her creature comforts (and herself) at home. Both the people listed above are prioritizing what they want – which is good and not cheap. Cheap is a whole different other animal. Cheap people are the worst! Let’s see how closely you identify with these stories of extreme cheapness.
Cheap v. Frugal
Personally, I’ve never understood people who sneak in snacks to the movies. I realize that movie snacks are expensive but movies are generally 2 hours long. That’s not enough time to need something to eat.
I think part of the fun, though, is feeling like you’re subverting the system. It’s about what you can get away with, not what you want. It’s like people getting thirds at a buffet even though they’re full. If it cost money, they’d say no; because it is free, they’ll overeat.
Being cheap is when you have enough money but your motivation for more money or savings trumps your physical, emotional, and mental desires. You do something because it saves you money even though it’s detrimental in other ways.
Why Are People Cheap?
He said, because it was free.
He went out of his way to drive to Starbucks, pick a drink he didn’t like and drink it, all because it was free. Time, calories, enjoyment – none of it mattered.
When I was younger, I tried to figure out everything I could get for free. But as you get older, you become a little warier about free stuff. Sometimes the furniture is free because it has bed bugs embedded in it. Sometimes the food is free because you’re getting a sales pitch. And sometimes it is a good product without strings attached but it is still too much of a hassle to pick it up or to do its upkeep, or sometimes you just don’t want it.
Free doesn’t mean costless. You are being too cheap when you forget that free has a cost.
The Cost of “Free” Stuff
If you have no money, then it makes sense to base your decisions on money. But people who have money who base all their decisions solely on money – that’s too cheap. There are personal finance bloggers who make much more money than I do and who put up all these constraints on how they can spend their money. No vacations. The cheapest food. Stingy with others.
As I’ve aged, I’ve learned to appreciate the other costs in life. Costs in time, mental energy, space in my apartment, convenience. It makes sense that the more money I have, the less I use money as my only lens with which to view the costs of things, particularly as those other costs have become more precious.
People think lifestyle inflation is the only thing you need to look out for but cheapness is also a pervasive and somewhat easy trap to fall into. What’s the problem, you may say. You’re saving money.
I think it makes sense for everyone to go through no-spend months and to live like they were college students again. It’s important not to forget that feeling of austerity. But living your life solely based on what saves the most money – that’s cheap.
The Problem with Being Cheap
I understand there are times when people need to feast and famine. If you don’t know where your next meal is coming from, then it probably makes sense to feast while you can. It might make sense to carry snacks with you in case you do get hungry because you can’t afford to buy a meal out.
My friend is not one of these people. He has a well-paying job, no debt, and few expenses. He could have bought something if he needed it. Also, and most importantly, he wasn’t hungry.
The problem with being cheap is that you let money dictate all your decisions.
And I’m not here to judge. I think we are all a little guilty of this. For example when:
- You consume things that are free or on sale even though you don’t really want or need it.
- Your only criterion is always price – never quality, lifelong goals, or convenience.
- You automatically forgo expensive activities because they’re expensive, no matter how they might benefit you in the future or how much enjoyment you would receive out of them.
Again, when money is tight, it makes sense that money is your chief consideration. But once you have some money saved, it makes sense to allow some other criteria into the mix, such as one’s own desires or needs, others’ desires or needs, or any long-term implications.
You Have to Have a Code
Imagine your parents spend their whole lives assembling the perfect toolbox. You ask to borrow a tool. They won’t give it to you. It makes them feel safer knowing they’re there in perfect condition and when no one can use them. Then they go back to accumulating more tools.
Money is a tool. If you have no projects, then why are you accumulating so many tools?
There are things that will cost money and you will have to decide what is more important to you. Your reputation. Legacy. Your relationships. Fun. Charity.
Cheap People Are the Worst Because Money Is a Cruel Dictator
I’m starting to become more mindful of my money decisions, but it’s a struggle. I’ve spent so much of my life scrimping and saving, it’s weird to think, oh hey, I can choose things that work better for me even if they cost more. Or, hey, maybe there are things more important to me than money.
A lot of social activities will say that consumer purchasing has a lot of power in sending a message to companies as to what consumers want or value. I also think that your purchasing power sends powerful messages to yourself and others. For instance:
- When you scrimp on food or health, you’re telling yourself, wealth before health.
- When you are stingy with your friends and family irrespective of their desires, you’re saying, I value money more than our relationships.
- When you pick the cheapest option for your work or career instead of the one that works best for you, you’re sending signals to yourself that you don’t deserve it, that you don’t believe in yourself.
Again, sometimes we have to worry about every last cent, and sometimes we don’t. I hope that when we get a little more wiggle room, or when we have hotel-sized wiggle rooms, that we then start to learn to dictate money to do our bidding instead of the other way around.
Conclusion – Cheap People Are the Worst
Money is not intrinsically valuable. What we do with it and how we treat it shows what we value. Frugal people are great but cheap people are the worst. You know you are too cheap when you value the tool more than the goal. But there’s a simple way to change that. Figure out what you really want, and then use money as a method of getting there.