How to be Frugal and not Cheap: It’s About Being an Informed Consumer
The road to financial independence requires certain personality traits, being frugal is one of them. Unfortunately, being frugal is often associated with self deprivation and being cheap. I beg to differ. Frugality has everything to do with being an informed consumer and has nothing to do with deprivation.
Those who are cheap only consider the cost of a product before making a purchase. In contrast, those who are frugal consider value for their dollar. Frugal individuals understand that cost is only one aspect to be considered. They also understand the least expensive purchase is not always the best purchase.
As with all aspects of financial independence, being a frugal consumer requires knowledge and a bit of patience at times. In this article I plan to discuss why being cheap is not really your best course of action in your journey toward financial independence. In addition, I’ll go over my own simple game plan for being frugal and making informed purchases.
The Least Expensive Purchase is not Always a Frugal Purchase
As mentioned previously, those who are cheap only consider cost when making a purchase. However, failing to consider all aspects of your purchase and going with the lowest price can sometimes cost you more in the long run. Quality, durability, maintenance costs, return policy, customer service, and functionality all need to be taken into account when you are looking for value in your purchase.
Considering the outdoor season is upon us, I’ll provide an example of an outdoor product I have purchased to demonstrate my point. The Weber Genesis gas grill. The price was around $600 at the time of purchase. Going into its ninth season of regular use, the Weber still looks great and is providing me with excellent results.
Quality, Durability, and Maintenance
I have purchased less expensive grills in the past. Friends and family members have owned various less expensive brands over the years as well. We were all lucky to get three good years out of these products. After a couple of years, they needed replacement parts, demonstrated signs of decay, were less efficient, and the results they provided were variable.
In contrast, the Weber is built like a tank, rolls easily on its high quality casters, and shows no signs of rust or decay. I haven’t needed to replace a part after eight years of consistent use. The only part that has stopped working is the battery operated ignitor, which I haven’t replaced. The Weber has a well thought out hole that allows for the use of a long butane lighter for ignition.
I expect to have my Weber for many more years, perhaps replacing only the burners when the time comes. I fully expect it to last at least as long as 5-6 of less expensive grills. Despite its initial higher cost, that’s what I call getting more bang for your buck.
The Weber grill is also an excellent example of the value of great customer service. After I assembled the grill, I noted the stainless steel grates were not lining up properly. I called Weber and a friendly customer service representative answered within two rings. That same customer service representative was shipping me a new set of grates within a few minutes of initiating the call.
Fortunately, I haven’t had further need to contact customer service. The grill has been a reliable work horse ever since. However, I suspect I would receive the same great service if any other difficulties should arise.
It’s difficult to put a number value on customer service. However, the excellent customer service demonstrated here has become rare these days and is extremely valuable in my opinion. We have all experienced the frustration of poor customer service at some point in our lives. You need to consider what your time and sanity is worth.
I enjoy using my Weber because it performs well and suits my needs perfectly. As a result, it gets used regularly, providing further value for my dollar. Purchasing an inferior product that does not provide a satisfactory experience will be used less frequently. Eventually, it may be abandoned, resulting in less value for your dollar.
I suppose this is starting to sound like a plug for Weber… it’s not. However, my experience with this product is an excellent example of how the informed purchase of a quality product is the more frugal choice, despite its higher initial cost. I expect my Weber to outlast five or six of the cheaper grills, providing cost savings. It burns more efficiently, providing further cost savings. In addition, I have had excellent customer service, which reduces frustration and saves time. Lastly, it is a joy to use and is used regularly, providing great bang for my buck.
Research Products Before Buying
Those who are frugal research products before making purchases, especially the large purchases. Personally, I enjoy the process of researching products. I find it fun, informative, and interesting. I enjoy spreading that knowledge to others.
Knowledge is power. How can you know if you are purchasing the best product for your needs if you don’t don’t take the time to educate yourself? How can you know if you are getting the best value for your dollar if you don’t do the research? I can tell you from experience that there is a great deal of satisfaction in knowing you made the best purchase for yourself.
Don’t be Prey
Lack of knowledge makes you easy prey for sales people. Don’t rely on a sales person to educate you. Go into the situation armed with as much knowledge as possible. Otherwise you may end up with less than you thought you were getting and spending a lot more than you should have.
Consider this example of a couple I met at a party who were the proud new owners of a Honda Accord. As a Honda owner myself, I congratulated them on the purchase of a reliable long lasting brand. I also commended them for buying slightly used as it would save them thousands. “Used!?” they stated. “It’s a brand new 2014 model.”
As an informed Honda owner, I knew from the body style that the car was at least 1.5 years old at the time. “Are you sure?” I asked. “I thought that body style ended with the 2012 model.” To make a long story short, a quick check of their registration revealed that they indeed purchased a leftover 2012 model in 2014.
This may seem like an extreme example, but this happens regularly. It never ceases to amaze me how anyone can make a purchase that large when knowing so little about the product.
The Internet is an Excellent Resource
Although it may sound harsh, you are simply being lazy if you don’t educate yourself about your purchases. Especially since you have so much information at your finger tips. The Internet makes it simple and efficient.
Sometimes a simple Google search will suffice. A lot of the leg work has already been done for you by a bunch of informed folks out there. Product review websites, consumer reviews, and forums are all valuable resources of product information.
Here is the process I generally follow:
Read Product Review Websites
Product review sites, such as Consumer Reports and Top Ten Reviews can be valuable resources of information. My favorite happens to be Consumer Search. They do a great job of collecting information from other review sites to make it easy and efficient for you. This site is often my starting point.
There are other review websites out there that are specific to particular products, such as electronics and cars. Cnet for electronics and Edmunds for cars are both good examples. They are worth a look to help you narrow things down and to delve deeper into your product research.
Check Consumer Product Reviews on Amazon
Amazon is a great resource for product reviews by the consumers themselves. Just keep in mind that many consumer reviews should be taken with a grain of salt. Some consumers who leave negative reviews are the type who can never be satisfied, used the product incorrectly, or failed to purchase the appropriate product for their needs. In addition, some reviews can be planted to artificially increase the positive rating of the product.
Some reviewers put more effort into their reviews than others. Pay close attention to the better written reviews to identify if the product meets your needs. A product is typically a safe bet if there are a ton of reviews that are mostly positive. In contrast, it may be best to steer clear of a product that has many poor reviews that are consistently complaining about the same issues.
Watch Product Reviews on youtube
Product review videos created by actual consumers are a great way to get more specific information regarding how products perform. I’m not talking about the “unboxing” videos out there. Personally, I don’t see the point of unboxing videos. Look for video reviews that provide demonstrations of the product actually being used.
Check Reviews on Website Forums
Forums can be a great resource for very specific information regarding certain products. Many contributors to these forums are experts or avid users of the products being reviewed. This makes them a great resource for identifying specific product shortcomings and better alternatives. I typically perform a Google search with a question about the product and include the word “forum” at the end of the search string. Works like a charm.
Search for the Best Price
Amazon was once my go to resource for good prices and free shipping. However, as the site has grown more popular over the years, you are less likely to find the best deal here. You are also less likey to receive free shipping unless you are an Amazon Prime member. I often find better deals elsewhere.
Sometimes a simple Google search will suffice. You may have to dig down a few pages to come across a company website with the best deal. Check to make sure the company is reputable. In addition, be sure to factor in the cost of tax and shipping charges.
Don’t forget to look for coupon codes before your purchase. A Google search for the company name followed by the word “coupon” will help you locate coupon codes. Retailmenot.com is a regular go to for me.
Other resources, including Craigslist, Newspaper Classifieds, and eBay can be excellent places to find great deals. This is especially true if your product does not need to be new. Many gently used products can be a great alternative to buying new.
I use eBay regularly and look for “Best Offer” auctions to snag great deals on new and used products. I only purchase from sellers with great feedback that provide good photos of the actual product. Contact the seller with questions before you bid. As mentioned previously, factor in the cost of shipping. Shipping charges can vary greatly on eBay. Shipping charges should be clearly indicated in the auction.
Being patient can pay off huge if you don’t have an immediate need for your product. This is especially true for more expensive items such as furniture, cars, and electronics. Just take your time and peruse the classifieds.
Relocation can make sellers very eager to part with their stuff. I personally have found incredible deals on used furniture. One example includes the purchase of a four year old $5,000 dining room set for $600. A second example is the purchase of a one year old $4000 bedroom set for $1200. Don’t be afraid to negotiate, especially if you know the sellers are relocating. Have your cash and a moving help on standby.
Hopefully this article has helped you understand that frugality has nothing to do with being cheap. A frugal consumer is a well informed consumer who beleives in getting the best value for their hard earned dollar. Frugality is an important tool in your journey toward financial independence. Keep in mind that every dollar spent on material objects is one dollar less to purchase your freedom. Do a little research and spend those dollars wisely.