Are You Really Frugal Or Just An Old Cheapskate?

Image by epSos.de via FlickrI have been called cheap and I have been called frugal, what's the difference, is there a difference? Maybe people are just being nice when they call me frugal. Cheap has such a negative connotation, maybe they just don't want to hurt my feelings.

What is frugal? 

Frugal is that you are making definite choices to save money. You are spending money in the most wisest way with a dignity and respect. Also no one is getting harmed or losing in the process.

What is cheap? 

Cheap is more akin to being a hoarder of money and things. You have something and just don't want to part with it on principle. Also when you are being cheap, someone or something is being hurt or losing in the process.

So what separates "frugal" from "cheap"? Here's a list, culled from several blogs: "Frugal for Life," The New York Times' "Your Money," Queercents.com and Bankrate.com.

Frugal: Taking home those tiny hotel shampoo bottles.

Cheap: Taking home the hotel-room light bulbs.

Frugal: Sneaking a snack into a movie theater.

Cheap: Sneaking into the theater itself.

Frugal: Accepting "free samples" at a grocery store.

Cheap: Accepting a free continental breakfast at a hotel where you are not staying.

Frugal: Buying artificial sweeteners in bulk from a discount store.

Cheap: Pocketing sweetener packets from a restaurant.

Frugal: Ordering only free water with your meal at a restaurant.

Cheap: Bringing your own drinks to a restaurant.

Frugal: Eating at less-expensive restaurants.

Cheap: Being a poor tipper at less-expensive restaurants.

Frugal: Finding stray golf balls in the rough at courses and using them.

Cheap: Selling those golf balls.

Frugal: Having dinner at 4:30 p.m. to get the "early bird" special.

Cheap: Eating a meal at a soup kitchen if you can afford to buy food.


So what's the verdict? Are you cheap or frugal. If your frugal, feel good about yourself, you are saving money and helping yourself get ahead. If you are cheap, rethink your motives and move away from the dark side.

Are Prepaid Cards Finally A Good Idea?

Image via WikipediaLately the emergence of prepaid cards are making a dent in financial circles. When American Express starts to get into the business people take notice. You see these cards more and more at drug stores, supermarkets, and retailers. You usually find them next to the gift card card display racks.

What are prepaid cards?

Prepaid cards are re-loadable cards that can be used anywhere credit or debit cards are accepted. They're popular with people who can't afford a traditional bank account, or who have been turned off by overdraft fees and other costs. They also offer a way for consumers who don't have credit cards to shop online. They come with monthly fees and reloading fees. If you need plastic and don't have a credit card or a bank account, with a debit card, prepaid cards are your only option.

What's the downside?

According to Consumer Reports, there are many fees and charges. They did a study comparing 19 different prepaid cards.

1. Activation Fees

Twelve of the 19 prepaid cards come with activation fees. The worst offender: First Vineyard card and its $39.95 tariff.

2. Monthly Fee

Sixteen of the 19 carry this fee ranging from $2.95 to $9.95. Most of the cards will waive the monthly charge if a direct deposit — think allowance — is set up. But the Green Dot card actually requires you maintain a $1,000 balance or make 30 transactions per month.

3. Balance Inquiry Fee

All 19 prepaid cards charge a fee to withdraw cash. So you shouldn’t confuse this product with a debit card. But 18 of them are really pushing the envelope and taking an additional 45 cents to $1 if you dare to check your balance at an ATM machine.

4. Customer Service

Perhaps the most surprising fee — and the most offensive one — is a charge to speak with a customer service representative. At least two do this and they are BuyRight and Exact card. If they nickel and dime you just for calling, I can’t imagine the companies will be all that helpful if you have a problem.

5. Inactivity Fees

Like gift cards, some of the prepaid cards carry inactivity fees. The Exact card dares to yank nearly $10 off your account every month it sits idle in your wallet.

One thing is for sure, prepaid cards have many fees and gotchas. Make sure you check out all the fees first before you sign up for them. Bankrate.com has a nice comparison chart to help you in your selection.

Men: If You Want To Have A Longer, Healthier Life Have Your Wife Retire

Image by SCA Svenska Cellulosa Aktiebolaget via FlickrAARP has a Health Discovery article that claims men will have a longer and healthier life if their wife retires. Angela Curl, assistant professor of social work at the University of Missouri, did a survey analyzing working couples over many years at the university's Health and Retirement Study. The surprising results revealed men feel their health improves when their wives retire.

"Women tend to monitor their husbands' well-being, making sure they eat right, go to the doctor, get some exercise, socialize," Curl says. The reciprocal of the wives claim of a healthier life did not happen. It seems the wife has a much more natural care giving tendency than men do.

When the wives retire they generally rated their health as worse during the first few years after they left their jobs, but then said it improved as time went on.

I find that this husband/wife ecosystem extends to other facets of life. Women tend to socialize more outside their jobs while men have more friendships integrated to their workplace. Success in life and business tends to be increased when a wife is there to guide and nurture the situation, keeping things on track.

Lower risk from heart disease.

Men can thank their spouses again because the reason married men have a lower risk of death from heart disease may be because their wives encourage them (ok, nag them) to go to the E.R. when they’re having the symptoms of a heart attack.

But again the reciprocal doesn't hold true, married women having chest pain did not get to the hospital sooner than single women.

I see in my own life how the marriage dynamic keeps things on track for me. I am grateful to my wife for the consistent gentle persuasion or nagging that is good for my health and happiness. The odd thing is even if my wife isn't there at the moment, I hear that voice in my head telling me the right thing.

AARP article: Husbands Benefit From Wives' Retirement

10 Reasons To Not Use Credit Cards

Image via WikipediaThere are many reasons to use credit cards and just as many reasons to not use them. Credit cards are just disastrous in some peoples lives. It's true a lot of people use credit cards their whole life and never get into trouble. But when you don't understand the dangers and troubles that can occur from misuse it's better to stick with cash.

I have listed several ways the use of cash is better than using credit cards:

1. You will never be in debt. It's pretty hard to get into credit card debt when you don't have any credit cards. It's hard enough getting out of debt, staying out of debt is much harder with those plastic cards pulling at you.

2. Impulse purchases will disappear. Credit cards make it so easy to make impulse purchases, only limited by your credit line. Within no time you can be in debt and over your head. When you spend cash it hurts. Cash is always in limited supply. When it's gone you know it. There is a physical connection between you and your money. Credit cards are a cheat on the process and a disconnect.

3. Credit card purchases are traceable. If you value your privacy use cash. If you want some computer somewhere to know everything you purchase, use credit cards. It's none of anybody's business what you do, where you go, or what you spend your money on. Credit cards makes it easy to know everything.

4. Budgets are easier to keep. When writing out your budget every month knowing your income less your expenses is simpler. Even if you are not the best at budgets you can never go back to debt if you overspend and are short on some bill. You will know where every dollar went, you will be more organized.

5. You will spend less. When you use credit cards, statistics show you spend on average 19% more than what you would with cash. Credit cards disconnect your brain from making good purchasing decisions. Spending money is sexy with credit cards, it's visceral with cash.

6. Card bonus points are not worth it. You think you are winning when you earn rewards from your credit card purchases. But these reward programs are just a way for the credit card companies to keep you on the hook so someday you will get caught again and go into debt. If you don't play their game you will always win. If you do play, there is a very big chance they will get you.

7. Spending cash links work with spending. Credit cards always break that link with how much you need to work to pay for that purchase. Spending hard cash makes it very real that the computer you just bought for $1,000 means you just had to trade a month of you labor for that item. When spending money is viewed as trading your days time and work for a hunk of metal or plastic you look at purchase in a new way.

8. Debit cards work instead of credit cards. There will be a time where you will need plastic to make a purchase and that's your excuse for keeping a credit card. Using a debit card from your checking account works exactly the same way. I have reserved automobile rentals and hotel rooms without any hassle using my debit card. I then pay my bill in cash or with a check.

9. No wasteful fees to pay. I never have to worry about late fees, lost payments, finance charges, messed up accounting, or interest rates. Also I never get a bill from a credit card company.

10. It's a freeing experience to not be beholding to the bankers. With all we have gone through with the financial institutions these past few years there is a bad taste in my mouth with these companies. Not using their product is just my way to voice my disgust for their actions.

I like to use cash, I prefer it to credit cards. It's a shame how the use of credit cards and their abuse is now the norm in our society and using cash is the rarity.