Freaky Frugal or Stupid Frugal?

There’s a huuuuuge difference between being Freaky Frugal and Stupid Frugal. A Freaky Frugal person is someone who saves money but realizes there’s a Happiness Return On Investment (HROI) in spending money on certain things.

What’s a HROI? A high HROI means that you gain much more in personal happiness than you lose from the dollar cost of the expense. A low HROI means you don’t gain enough personal happiness to justify an expense. If an expense is really low or even free*, it’s pretty easy to hit a high HROI.

A Stupid Frugal person is someone who saves money at all costs – he doesn’t care about the consequences. A Stupid Frugal person is also known as a cheapskate, tightwad, skinflint, or penny-pincher. Not a fun person to be around. The classic example is Scrooge at the beginning of A Christmas Carol.

Here’s a handy, dandy table that breaks things down between Freaky and Stupid Frugal by different aspects of life:

Category Freaky Frugal Guy Stupid Frugal Guy
Relationships Sometimes spends money on and with others to be happy. What relationships? Money and savings are the most important thing.
Stuff Keeps and buys stuff that gives him great HROI. Gets rid of all stuff regardless of how useful it is or how happy it makes him feel. Less is always more.
Experiences Interested in free or paid experiences that give him a great HROI. Only interested in free experiences.
Food Looks for the best deals on healthy, high-quality food. You only have one body so it pays off bigtime to take care of it. Buys the cheapest food he can find. Ramen Noodles anyone?
Exercise Does strength and aerobic training regularly. Doesn’t have time to exercise because he’s too busy making and saving money.
Charity Gives money or time to causes or people he believes in. Research shows that this will make him happy. Doesn’t give any money for anything.
Housing Makes a good trade-off of size, quality, and location. Has a bias towards housing that’s close to work. Finds the cheapest housing possible even if living there makes him miserable. May have long commute to work which ends up costing more than he realizes.
Transportation Has no car or a reasonable used car. Uses car as little as possible by living close to work and bicycling or walking for transportation and health. Has a car that requires constant maintenance. Doesn’t have a bike or use a bikeshare because it costs money and takes too much time.

Nobody’s perfect

I’m ashamed to admit it but I’m still Stupid Frugal sometimes. I should know better, right?

Mrs. FF likes to run. I mean she REALLY likes to run. As in multiple races per year including the Boston Marathon which is hard to qualify for. I sometimes get annoyed with her about the money she spends on running gear, running groups, race fees, and race travel. But I stopped complaining after I realized it’s a small price to pay for her happiness and our relationship. Some things are worth the solid HROI. Duh. Besides, running keeps her in great shape which has a variety of fringe benefits. 😀

Mrs. FF looking bad-ass during a race.

So there’s a trade off when you have a spouse or children. What’s one person’s Freaky Frugal expense is another person’s Stupid Frugal expense and vice versa. It’s very personal because HROI is very personal. You have to be willing to compromise to find a happy middle-ground. It took me many years of marriage to figure that out. Better late than never!

Debt Emergency, dial 911!

There’s also a special case the great Mr Money Mustache calls a Debt Emergency. When you have credit card debt, car loans for fancy cars, large student loans, or an unreasonable mortgage, all bets are off. You need to be Stupid/Crazy/Wacko Frugal because the debt stress will make you nuts.

Really Stupid Comic #3

Sometimes you can reduce the debt – get rid of the car, consolidate credit card debt, or downsize. But sometimes you just have to buckle down until you pay down the debt.

Thanks for reading! What’s your take on Freaky versus Stupid Frugal?

* HROI = Level of Happiness  / Monetary Cost. Technically, if Monetary Cost is 0, then HROI would be undefined. But I prefer to think of it as infinite. Call it my magic math.

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  1. I used to be in the stupid frugal camp. Super miserly. My wife helped bring me closer to the middle. Same with her too since she was on the opposite side. Especially in a relationship, it helps to consider the other person’s traits, leanings, and personality. Can’t be too zealous one way or another or it’ll burn the other person out. So we’ve stopped sweating the small stuff. We spend money where it bring the best ROI. We save the rest.

    1. Tim – Thanks for sharing!

      Sounds like you and your wife have found a good compromise. That’s awesome!

      Mrs. Freaky Frugal and I started out similar in terms of being frugal. She pretty much stayed the same, but I became Stupid Frugal. It took several years and some conflict before I became Freaky Frugal (again). It was a hard lesson and I still have to be vigilant to make sure I don’t slip up.

  2. I’m still in the Stupid Frugal camp! I’m not sure if I can change – I’m a natural hermit with a workaholic personality…

    The living closer to work thing resonates with me though. I know a lot of new families and their biggest regret was not purchasing a house closer to work. Since daddy leave at 5 but the traffic slows him until 6:30 he misses dinner with the kids. That’s definitely NOT frugal.

    1. Thanks for being honest! I spent and sometimes still spend time in the Stupid Frugal camp. I’m pretty vigilant now though because Mrs. Freaky Frugal helps remind me. 🙂

      And yes, lots of people buy homes that are too far away from work so that they can get a bigger home. Really a bad idea if you want to see your family. And the commuting and car depreciation costs makes it a really bad financial move.

    1. Matt – I liked your post so I turned it into a link in your comment.

      I’ve actually spend larger chunks of time saving money since I FIREd. I now have so much time that it’s not worth as much as it used to be worth. I try to be Freaky Frugal about it though and at least value my time above minimum wage.

      Before I FIREd, I would calculate how much money I could make working at $50 per hour versus saving money doing something else and pick whatever paid more.

      Not allowing yourself to enjoy life is also something I’ve done. And that slips into being Stupid Frugal for me. Mrs. Freaky Frugal helps me a lot with finding a good HROI.

  3. I totally agree that people can be stupid when it comes to frugality. I’ve known people who are not very generous even though they have a very high net worth. No one wants to be remembered as Mr. Scrooge! When I was a newlywed, I was a little too extreme. We rarely spent money on anything. Now, we have a system in place that allows us to spend guilt free. The strategy is to budget fun money using unique debit cards and automatically funding the account each month. Being frugal is great. But it shouldn’t ruin relationships or destroy your life. Thanks for the great insights.

    1. What a coincidence – I have a post that discusses Fun Money and budgeting! Mrs. Freaky Frugal and I have used Fun Money approach and it worked well while we used it. We used separate Fun Money savings accounts along with dedicated credit cards that we paid off each month.

      Congrats on finding the right frugality balance after you married. It’s not easy. Lots of relationships blow up because of financial issues and differences towards spending.

  4. I’ve never been either. I don’t waste money on the latest tech gadgets or cool toys/stuff, but I’m not extremely frugal either. I don’t waste money eating out but the money I do save I spend on enhancing my quality of life (e.g. buying organic everything).

    1. Thanks for sharing!

      You actually sounds like your Freaky Frugal to me. The main criteria for being Freaky Frugal has little to do with exactly how you spend your money. Rather it’s whether you seek a high HROI whenever you do spend.

  5. I love reading about the HROI. What’s the point of having a ton of money if you don’t spend it on anything. Money should allow you to pursue your passions not make you stuck at home spending no money. Great list!!!

    1. Yep, it’s all about HROI!

      Lots of people go their grave wishing they’d worked less, pursued more passions, and nurtured better relationships. But day-to-day it’s easy for me or anybody to become obsessed with pursuing wealth at any price.

      I try to keep a perspective on the big, long-term, picture. I find it gets easier as I’ve gotten older (57 and counting).

    1. Yep, it’s a useful concept even it isn’t realistic to come up with a number.

      The hardest part is predicting HROI before you ever spend money. Plenty of spending turns out to be duds in terms of HROI. I think this might make a good future post. 😉

  6. Guilty as charged – I used to be stupid frugal. After being married for 3 odd years I don’t think I am stupid frugal anymore. Still frugal though and know the limits of spending. Good post!

    1. Yeah, being married taught me lots of things about being frugal and compromising. And having children taught me some more stuff. I wish I’d learned a little quicker though. 🙂

  7. What always bothers me is when I see someone holding back on doing things they claim to love because of habit versus careful consideration. I’ve probably over used the example of the elderly couple in their 80’s who loved to dine out giving it up, despite having over five million in the nest egg, because neither drove anymore and they were getting rid of their car. They didn’t consider the likely $1000 a year in car insurance, $100 a year registration, $1000 or so a year in gas and maintenance they already were paying to balance against hiring a neighbor, hiring a limo, hiring an Uber, hiring the chef to come to the house and cook you a meal once a month, etc. so they could continue to enjoy a dining experience now and then even before touching the nest egg. It’s just an example of former frugal (hiring a car is “expensive” and we don’t waste money on that) taking over automatically because that’s what you’re used to and failing to see beyond that to the real goal of enjoying a dining experience.

    Say you love biking, but after an accident your knee hurts so much you can’t enjoy it anymore, so do you give up or invest in an e-bike to make your biking easier? Some of those kits are pretty expensive, $500 and up into the thousands. But did the biking keep you in shape? Get you to work? Saved money on gas and car wear and tear? Too often we choke on the initial outlay and immediately say no out of conditioning before we’ve really looked at all the factors and alternatives to get back to something we enjoyed. I’ve seen my MIL insist on spending money for my kids to do an activity, yet holding herself back from joining in with them not because she couldn’t physically join in but because she couldn’t see spending money on herself. After I saw it the first time I asked her if she really couldn’t afford to drop the $5 or $10 it had been to join in, and she considered it a moment and then said she could have joined in and regretted not doing so. I realized she was acting out a frugal habit from when she was younger with her own kids and they really had very little money and that it didn’t reflect her current situation. My wife and I had to break the pattern by insisting she join in a number of times, because her habit and initial reaction to those kinds of situations is to always hold back even though she intellectually knows she’s fine financially. Without getting a bit of a push she would have missed out on enjoying things with her grandkids and while there is pleasure in watching them enjoy themselves, there is also pleasure in participating with them when it’s appropriate. It’s those kinds of habits that people need to adjust or at least be ready to reassess IMHO.

    1. Thank you for sharing! And you have some really good points. One point is that people sometimes classify things as “luxury”, “ostentatious”, or even “decadent”. Once that happens, they won’t purchase that thing no matter what. Even if it is Freaky Frugal with a excellent HROI.

      Another point is that it’s hard to stop being frugal because it’s a lifetime habit. Both my parents were depression-era children. So they learned to be very Freaky Frugal as they grew up. But eventually some of the Freaky Frugal behaviors became Stupid Frugal.

      My Mom really enjoyed tea. But she would buy the cheapest Lipton tea bags should could find and then REUSE the tea bags. That was probably Freaky Frugal during the Great Depression, but Stupid Frugal after they retired and had many assets. It was just a lifetime habit that was hard to break.

      1. I think the key thing that both you and getagrip talk about it, is breaking the habit of being Freaky Frugal that leads to Stupid Frugal or heck even lightening the load on being Freaky Frugal. I would say at 80 years old, you should be less frugal and letting your freekiness fly. Especially if you have multiple of millions to blow. I not talking lighting cigars with $100….

        I am hoping I will be able to recognize this in myself as I get older and realize I have ‘enough’ to loosen the purse strings.

  8. Good post. This is what I call “sensibly frugal” in my blog, there’s even an article by that name I have written. It’s now clear to me why you successfully FIRE’d and have a happy family to spend time with as well. You aren’t freaky, just sensible!

    1. Thanks for sharing!

      I like the name “sensible frugal” as well. But I had to call it “freaky frugal” because, well, that’s the name of my blog. 🙂

  9. My uncle, never married an no kids, is stupid frugal and always thinking about making more money., even today at 84 yo. I asked him … How much is enough, his answer … “you don’t understand, it’s because I know how to make it”. 2nd question.. Why don’t you spend some and enjoy life? His answer… I can’t enjoy spending money. We used to visit him and invited him to holiday get togethers but no more. He brags about his money and lectures us constantly (Although his intent is good, his delivery is terrible). He says all women know how to do is spend money. He’s turned the entire family off. Now he complains that no one comes around. I tried to explain to him that money is a tool to use to live life and there has to be balance. And please stop lecturing and fighting with everyone over it. Nope, he won’t, sadly, because of his stupid frugality and mentality he’s a lonely man. Nothing more I can say or do.

    1. erayp- That’s a very sad story.

      You like to think that people like your Uncle who save money can eventually use the money for something that brings them and others joy. But sometimes the desire to be frugal becomes an end in itself – a compulsion really. And like any compulsion it can take over your life and create misery. It’s insidious because most people consider “frugality” a good trait, but like anything it can be taken too far. Your Uncle is a living example.

      Thanks for sharing!

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