Be Frugal, Not Cheap

piggybankThere is a big difference between being frugal and being cheap. It is essential to attain financial independence that you limit expenses. Being smart about how you spend money however does not require you to be cheap.

Quality vs. Quantity

It is better for example to buy two pieces of quality clothing than to buy five items of lower quality clothing. The quality clothing will last much longer and look better longer. Buying low quality clothing is being cheap, buying higher quality clothing in less quantity is being frugal.

You can apply this same principle to nearly everything, it does not just apply to clothes.

Knowing Your Finances

The Financial Sumurai in a recent article observes quite correctly that people are often cheap because they are not aware of the state of their own finances.  Because they do not know the exact state of their finances they do not know what they can afford. Thus, they buy the cheapest thing.

I entirely agree with the Financial Samurai. I keep careful track of what I spend and what comes in all the time. This allows me to always know what I can and cannot afford.

Never Buy Top or Bottom Price

I cannot recall where I read this bit of advice but I’ve followed it nearly all the time and find it works well. The most expensive price for something is usually over priced. You do not get more quality for top price. That is usually an illusion perpetrated by those who sell to influence you to buy top price because you believe it buys top quality. In fact you can often pay much less and get just as good a quality.

Likewise I rarely ever buy at bottom price. If it is too cheap to be true it likely is not true. Often the cheapest item is shoddy and will not last. You end up paying more in the long run because you need to replace it fairly soon.

I suggest you will most often do best buying in the medium to medium high price range for a good quality item. If you shop around you may bet it for a bit less. Be careful about the quality of what you buy. It does not always correspond to the actual price.

Take Care of Things

This I learned from my grandmother. She believed in buying good quality items and then caring for them well. She kept things clean, lubricated, and in good working order. If something needed to be mended or repaired she had it repaired. She did not replace something unless it was genuinely obsolete or totally broken.

Over several decades of careful shopping for good quality things and then caring for them properly she had a handsome collection of clothes, furniture, etc. She could never have afforded to buy them all at once, but over time she did. Because she cared for them and because they were of good quality they lasted. I have just a few of her things, a piece of furniture and a few other items, and they are all of the best quality. They are now over 60 years old and work well. She never had a lot of money, she was a hotel maid and then a hotel housekeeping supervisor. However she understood quality and frugality.

Be Frugal, Not Cheap

Buying carefully, selecting for quality, and taking care of things are all frugal, but they are not cheap. Buying cheap leads to poor quality things that will not last and will not work well.

Learn how to manage your money, eliminate debt and build wealth in my book, Your Financial Success.

Questions? Comments? I would love to hear from you. Feel free to post your comments or questions below or if you want to contact me privately you can do that here: CONTACT ME HERE.

Wishing you well,

Daniel R. Murphy
Educating people for building wealth, adapting to a changing future and personal development.