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Living Cheap: A Guide for Beginners E-mail
Written by Omie Ismail   
Article Index
Living Cheap: A Guide for Beginners
Who Loses if You Are Cheap
How Does One Become Cheap
A $3,000 Couch?
The Greatest Generation: Cheapsters
Why America Should Be Scared Right Now
Actually, This is the Scary Part
The 10% Gap Between Solvency, Wealth and Bankruptcy
What's the Point of Being Cheap?
Get on the Path of Cheapness
All Pages

Not Born Cheap? Mom and dad didn’t instill it in your formative years? If you aren’t cheap but wish you were, read this primer. And if you’re already cheap, but want to get better at it, read on.

Let’s get started by first defining the word cheap. The Merriam Webster dictionary definition of cheap:

1) Noun: at minimum expense (Middle English before the 12th Century) and
2) Adjective: purchasable below the going price or real value (English – 1509).

Sounds good to me. So when I extend you an invitation to live cheap, all I really want is for you to live your life at the minimum expense by making smart life decisions and by purchasing things below the going price. I’m not out to convince you that you should stop going out to dinner or skip taking vacations for the next 20 years. And I’m certainly not going to advise you to go diving in a dumpster for recyclables or trade in your car for a bus pass.

That’s the pervasive image that has tarnished the reputation of decent cheap people around the world. Hopefully, by the time you’re done with this primer you will have a completely different view of acquiring cheap values. I am talking about living your current lifestyle or better for less money. Think that’s impossible?

Cheap vs. Frugal

How did we get to a world where living cheap was considered negative? If you ask someone if they're cheap, they’ll typically say, “Oh I’m not cheap, I’m just a little bit frugal”. Well frugality has its place, and it’s a lifestyle based on consuming far fewer resources. Being frugal is a good thing, but I’ve seldom meet people that qualify as truly frugal.

People will tell you they’re frugal before driving off in a Ford Expedition. They don’t actually consume less gas, food, or electricity - they’re simply smart enough to not overextend themselves. Most people living cheaply have an element of frugality in them as I do when it comes to electricity usage.

But living cheaply is mainly focused on managing your current lifestyle, at whatever level it may be, at minimum expense. If you decide that you want to live the simple life and leave a small carbon footprint, go for it. It’s going to make it less challenging to live below your means. And that last phrase is an absolute requirement when you’re cheap; you have to live below your means. If you develop a ‘cheap’ ethos, it won’t take you long to get there.

Maybe a little example would help here to clarify the cheap/frugal divide. The average visitor drops about $400 on a one-day family trip to Disneyland. The frugal individual spends nothing because they take their family to their neighborhood park instead. As for the family intent on living cheaply, they take the middle ground by taking the kids to Disney for $200. They shop around and figure a way to enjoy the same exact experience as the ‘$400 visitor’ for half the price. Better yet, they might do a little research and decide to take their family to a more relevant and entertaining amusement park for $150. Again, I am all for frugal and you'll get a dose of that on LiveCheap too, but if you want to emulate the family that opted for the sensible outing, then read on.



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cheapliving  - Really enjoyed... |2012-02-23 03:28:49
I am talking about living your current lifestyle or better for less money. Most people living cheaply have an element of frugality in them as I do when it comes to electricity usage. The frugal individual spends nothing because they take their family to their neighborhood park instead. If you are cheap you are frugal. You have to get up and do the laundry instead of going to the dry cleaners. I could list so many more but you get the idea. It comes to the choices we make and what is important to us. I needed the break to get healthy and the economy is affecting the small business man. When the office picks up and he needs me back I might go. My youngest is a senior in high school. It must not be that bad because all of their friends end up at my house. Cheap is a choice and I enjoy it. Thanks for this site I found it yestrday and love it. enter cheap airfares in google and see what pops up. Being cheap is about being a smart savvy consumer. But we also welcome folks with more extravagent tastes. I might add that some of our readers who participate in these forums are also willing to share some of their wisdom with the rest of us. America is addicted to cheap as much as they are addicted to debt. Being an informed consumer is good. Living below your means is a must. But thinking we are entitled to goods for less than their real value is a dangerous game. Buying cheap supports efficiency only to a point. And we are there to help our neighbors the best we can as well. Government spending is something they may let you have a say on in the voting booth. We still live in a country where you do control a huge percentage of our ultimate outcome. who spend more every year than they take in. They have made it work through increased taxes and stock market gains. That level is not sustainable which is why you are seeing layoffs at the local level. It is more cost effective to get the work done overseas. We are becoming a center for only the service industry. I think the first thing people need to do is become a little rational and lower their expectations and tame their craving for things they might not neccesarily need.Really enjoyed reading your blog, i run a similar blog - id love for you to have a look over it and give me some feedback (as you're such a pro)
Busymom25  - Both Cheap and Frugal go hand in hand |2010-12-31 21:29:19
Some can take the meaning of both words to the extream, but they go hand in hand. If you are cheap you are frugal. I should know when I was first married and we had our 2 daughters we lived only on a military income 20+ years ago. How cheap you are goes to what is important to you. I was a stay at home mom for 12 years, yes it took being cheap or frugal or what ever you want to call it. I would not change anything, yes it took more work on my part but it was worth it. YES living cheap is more work, you have to get up and make dinner instead of going out. You have to get up and do the laundry instead of going to the dry cleaners. I could list so many more but you get the idea. It comes to the choices we make and what is important to us. Yes I worked outside the home for 8 years only to pay more in taxes and food and all the things that make it easier on me to be able to work. I stepped back from my job this year, one because my employer needed to reduce his payroll and 2 I had many health problems last year and worked thru them. I needed the break to get healthy and the economy is affecting the small business man. When the office picks up and he needs me back I might go. The reduction in income has been good, I have always been cheap even with 2 incomes, now that we are back to one things are not that much difference other than eating out. I still don't buy anything unless its on sale. My house is paid off so are my cars which are all older, but being cheap has allowed me to have a 4 cars one for everyone in my family. Yes my girls have older cars and there friends have newer but my oldest works and goes to college full time and lives on her own, most of her friends still live with their parents, she has learned from my example over the years. My youngest is a senior in high school. By living cheap she can enjoy her senior year and not work yes they both have cell phones and we have every channel on cable known to man, why because being lazy at home is something we like to do. It must not be that bad because all of their friends end up at my house. Cheap is a choice and I enjoy it. Thanks for this site I found it yestrday and love it. Keep up the informative work.
haverwench  - Why "cheap" is a negative |2010-08-14 19:47:58
I don't quite get your distinction between "frugal" and "cheap": "Well frugality has its place, and it’s a lifestyle based on consuming far fewer resources...But living cheaply is mainly focused on managing your current lifestyle, at whatever level it may be, at minimum expense." How is that *not* frugal? Isn't money a resource, and isn't consuming less of it frugal?

I don't think you're actually defining these words the way they're commonly used. My dictionary defines "frugal" as "sparing or economical," while "cheap"--when applied to a person--means "miserly; stingy." Given this usage, it's easy to see why people would rather be thought of as frugal than cheap. The frugal person saves money (and other resources) without being a miser; in fact, frugal people are more likely to be generous because they have more money to spare. So I think the word "frugal" actually comes much closer to what you're describing as "living cheaply" than the word "cheap" (in its common usage) does.
frugal nomad  - Do we say Frugaler or Cheaper |2010-08-15 09:29:12
About common usage. How many times have you seen a retailer advertize his goods as "the frugalest price of the year." Cheap, in our usage, is about scoring a product or service at a better price. look at travel sites. enter cheap airfares in google and see what pops up. Look how many sites use 'cheap' in their title.

A lot of frugal people are misers and minimalists. Being cheap is about being a smart savvy consumer. As far as we're concerned, your material appetite is your concern. But once you determine what it is you intend to buy, why not save a little on the price.

Living cheap and being cheap are two entirely different things. We welcome frugal people, even misers to livecheap.com. But we also welcome folks with more extravagent tastes. We've written about how to score a cheap trip to Tahiti and how to go Skiing without busting the budget.

A lot of people are confused about what we're about and we've actually debated whether our name distracts from our substance. But you have to admit, livecheap is an easy name to remember just like cheapflights. It has a certain ring and eventually most of our readers get to understand that we're much more than a place to learn how to pinch a penny.

We definitely recommend a modest lifestyle. For one thing it is environmentally correct and it's a standard of living that is more sustainable when you come under financial stress.

To each his own when it comes to consumption level. But when it comes to getting whatever you want at a better price, we think we have a few tricks up our sleeves that we try to share with our readers. I might add that some of our readers who participate in these forums are also willing to share some of their wisdom with the rest of us.
Jason  - Living Richly |2010-08-03 18:53:59
I don't see anything wrong with being cheap as long as it makes sense. It does take quite some time to get use to, but it's life. Being can save tons of money.
The_cud  - Everybody loses in a race to the bottom |2010-07-23 10:28:46
So I agree with most of the primer except the logic jump of buying too much cheap junk from China as one of the sources of the current economic hurt to paying less for fewer cheap items from China as insulation from economic woes. America is addicted to cheap as much as they are addicted to debt. Being an informed consumer is good. Not getting bilked is great. Living below your means is a must. But thinking we are entitled to goods for less than their real value is a dangerous game. When you pay less than the real cost of acquiring an item, negative externalities are generated. Some are absorbed by the "mega-corporations" or non-cost-sensitive customers. Most are doled out as reckless pollution, social weakening, and a decline in real wages for our neighbors. I support making smart financial choices, but I feel it's worth noting that buying anything is a vote for everything the product stands for. Buying cheap supports efficiency only to a point. After that, everybody loses in a race to the bottom.
The_cud  - Everybody loses in a race to the bottom |2010-07-23 10:26:15
So I agree with most of the primer except the logic jump of buying too much cheap junk from China as one of the sources of the current economic hurt to paying less for fewer cheap items from China as insulation from economic woes. America is addicted to cheap as much as they are addicted to debt. Being an informed consumer is good. Not getting bilked is great. Living below your means is a must. But thinking we are entitled to squire goods for less than their real value is a dangerous game. When you pay less than the real cost of acquiring an item, negative externalities are generated. Some are absorbed by the "mega-corporations" or non-cost-sensitive customers. Most are doled out as reckless pollution, social weakening, and a decline in real wages for our neighbors. I support making smart financial choices, but I feel it's worth noting that buying anything is a vote for everything the product stands for. Buying cheap supports efficiency only to a point. After that, everybody loses in a race to the bottom.
sistasuzy  - being responsible |2010-04-30 06:49:59
We have to take our own action,if nothing else lead by example. We can go on blaming irresponsible politicans for ruining our world but we can take care not to over extend, not to spend what we haven't got, save on what we can, put away for the future. Heck farmfolk know that just put up the food you can, mend what you can and take care of what you have. If you are trying to impress everyone else how are you taking care of yourself? and being angry and blaming others for your problems is doing anything about taking care of yourself, family and home. And we are there to help our neighbors the best we can as well.
frugal nomad  - Well said |2010-04-30 07:30:40
You take control of the things life lets you take control of. Government spending is something they may let you have a say on in the voting booth. But we can hold our breath till we're blue in the face and wait for the government to wake up and spend sensibly. That doesn't absolve you of the responsibility of taking care of your own financial affairs and living within your means.
Omiewon  - I think you'll find many people that follow LiveCh |2010-05-01 20:11:46
Responsibility is key. We still live in a country where you do control a huge percentage of our ultimate outcome.
gman  - 70%.... |2009-10-25 13:28:59
the 70% that live paycheck to paycheck includes our govt. who spend more every year than they take in.

And yet govt employees still are well compensated AND have a pension..... and how long do they think that will last?
Omiewon  - Government Pensions Unsustainable |2009-12-15 10:06:59
Governments made promises that they ultimately cannot keep. The private sector has all but eliminated pensions by switching to 401(k) contributions, but the governments still have rich benefits and pensions. They have made it work through increased taxes and stock market gains. But after a decade of no gains in the stock market and a limit on how high they can jack property taxes and sales taxes, they are left with a massive shortfall.

Government employees make up about 12% of the workforce and are growing as a percentage. That level is not sustainable which is why you are seeing layoffs at the local level.
Sleuth  - Outsourcing |2009-10-19 07:28:25
The growth of outsourcing in this country by employers is on the increase. It is more cost effective to get the work done overseas. We are becoming a center for only the service industry.The employer is making more than 20% in almost every category. When you stop manufacturing what your country needs, the country is in danger of a collapse. It will not be much different from a 3rd world country.
frugal nomad  - The party is over |2009-10-20 12:33:37
The party is over and the sooner people come to terms with the fact that we're dealing with an entirely new economic landscape, the better it will be for everybody. I think the first thing people need to do is become a little rational and lower their expectations and tame their craving for things they might not neccesarily need.
 
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