Easily one of my favourite posts by the infamous early retiree Mr. Money Mustache is one in which he explains the difference between being frugal and being cheap. What is considered frugal by some is indeed deemed inconceivably cheap by others and vice versa. Now, I consider myself to be a pretty frugal person and a lot of people actually qualify me as cheap, but you know what’s really weird? I consider those people to be cheap!
“But you hardly ever join us for sandwiches during the lunch break between classes”, “why don’t you want to come along on our two-week all-inclusive vacation to France”, “you have been using the same backpack for over seven years now” and “you never order the more expensive dishes when we’re at a restaurant” are but a few of the misguided comments that I have come to expect over the past few years.
Fair enough, much of the above is actually true. Yes, I don’t spend €3 on sandwiches, I bring my own lunch. Yes, I’m not going on your vacation because I took a summer job. Yes, I still love using that awesome backpack. And yes, I don’t want to spend over 25 euros on entrecôte every time I visit a restaurant. However, there is a big but
t! I do so because I only like spending money on things that enhance the quality of my life drastically for an extended amount of time.
When I left the parental nest, for example, and headed off to university I needed a notebook. Ever since I was little my room had been filled with a giant desktop PC, but 18-year-old me had to travel more often, so a notebook seemed appropriate and was kind of a necessity. Contrary to most of my friends who spent about €600 on a laptop this guy right here went all out and bought himself a top of the line €1,600 Sony Vaio – at that time it would have taken me over a month and a half of work to save up for it. Whoa, badass alert!
Why? First and foremost, I was probably the only one among my friends who was able to put down that amount of money on a laptop. And second, I like high quality stuff, especially if I have to use it day in, day out and I know I’ll need it for a very long time. As it turns out, my precious notebook lasted me through all six years of university and then some. It still works perfectly fine!
My friends’ laptops, however, not so much. Most of them died within two years, mainly because they were crap, but also because my colleagues didn’t take care of their equipment. So after two years everyone had brand spanking new notebooks except this poor fellow. Guess what? After two years the same thing happened again. Everyone went out again to buy a €600 laptop that still wasn’t as good as mine from four years earlier.
A quick calculation shows that after six years of university I payed €1,600 up front and my friends were €1,800 out of pocket. The real kicker? I was actually the only one who enjoyed using his notebook! It’s just like Mr. Money Mustache said: “frugal people still get to own and enjoy top-quality assets, tools, and investments.”
This anecdote taught me two things. First, frugality is in the eye of the beholder. Some people call me cheap for bringing my own lunch, while I believe they are cheapos for buying second-rate products. However, don’t judge someone else on his spending pattern unless you know the full picture.
Second, spending more to spend less is a real thing, but only if you are smart about it. Make sure to always consider operating costs, a product’s actual effectiveness, its longevity and the sheer satisfaction a better product provides you. Only then will you be able to make an educated purchase.
In the end, it comes down to personal preference of course: different strokes for different folks. Would you rather take the €1,600 notebook or the biennial €600 upgrade programme?