by Dana Moses

Created on: April 21, 2009

In today's economic climate, frugality is the new black and everyone is interested in how to save a few - or a lot more than a few - bucks. Personal finance is all the rage, with blogs, television pundits, and newspaper articles constantly spouting advice for how to scale back expenses. These sources will tell readers and viewers to clip coupons or garden to save on grocery costs, use the library as a replacement to the bookstore, and call phone and utility companies to ask for discounts. Raise your insurance deductible for a lower premium! Swap baked goods with friends for babysitting services! And don't forget to keep your tires inflated!

But at some point, a frugal, money-savvy consumer can cross a line and become a cheapskate. Sure, use the library for its books - and DVDs and free internet but if you get to the point where you're stealing the scraps of paper and the golf pencils for your kid to take into school, you've become a cheapskate. Yes, of course you should use coupons and buy off-brand products to trim your grocery bill, but please throw out your rotten veggies and sour milk. Fly coach or even drive to save on transportation for that visit to family across the country. But if you find yourself making excuses to stay home alone on holidays rather than buy a bottle of wine to take to your brother's house, you've crossed a line into cheapskate. To save money on eating out, cut back on how often you eat at restaurants, or stick to water and pass on the appetizers to keep the bill lean. But if you're eating out and saving money by stiffing the waiter on the tip, you've become a cheapskate. While a frugal person might call their utilities companies to negotiate a lower rate, a cheapskate just steals wireless internet and cable from their neighbors.

A frugal person makes do with less, to the point that a frugal person enjoys having or using less while still living a rich life. A frugal person wastes as little as possible and values time spent with loved ones over money spent on loved ones. A frugal person spends less than what they earn in order to save for a rainy day, retire early, or give generously. A frugal person eventually can be financially independent and can use money for things that they personally find important and satisfying.

A cheapskate doesn't spend much money either, but also doesn't have goals for what they want their money to be able to do one day. A cheapskate saves their own money at others' expense by not bringing that bottle of wine to a friend's house for dinner, but drinking anyway. A cheapskate would not contribute to charity, would never buy girl scout cookies from their nieces, and hopes that their friends forget about the time they borrowed $10, or at least are too embarrassed to ask for it back.

Money can't buy respect or friendship, but refusing to tip for good service, pay friends back, or bring wine to dinner are all ways that the lack of money can block respect and friendship. As you find ways to brighten your monthly budget, remember that some things in life are worth more than money!

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