I was chatting with some folks the other day, trying to pick their brains about the best place and price for getting a Wii. Like so many other families, we’ve decided to get this gaming system for our kids–and a Wii Fit for me–for Christmas. And like so many other families, I imagine, will be doing, we are making this our one big present for the holidays and that’s it. It’s our attempt not to let the grinch steal Christmas while still staying in the black.

While many of the women gave me great advice–check out Costco, have you looked on eBay, things like that–one of the women made a snarky comment that really caught me off guard: “Gee, I should try to be your kind of frugal,” she said to me. “It would raise my standard of living.”

Huh?

I think she must have me confused with a spendthrift. I guess it’s her assumption that if you’re living frugally, you can’t possibly be doing something like buying a Ninetendo Wii. But she would be wrong.

The reason that we can afford to get this present this year is because we’ve cut back enough to save up the money to buy it–painfree and debtfree. I think that’s the part this person has missed.

On the other hand I have a friend who would never consider buying her daughters a Wii–and she calls herself frugal like I do. However, I think that this woman is actually a tightwad or a cheapskate. While she lives well and is always nicely dressed, I know that it pains her to spend money on anything. She relies on Freecycle for nearly everything she needs, she’s an avid gardener and canner, and I can’t remember the last time she got in her car–she hates to spend money filling the tank.

I couldn’t help but think about this friend–and myself–when I came across a survey from Wharton Business School that asked, “Are you a tightwad, frugal or a spendthrift?” In surveying 13,000 Americans about these three “labels,” they determined that people who fit into one of these categories have very different personality traits. (I’d referenced this study once before in an earlier post on grocery shopping in a more affordable manner.)Here are some of their findings:

* Tightwad
According to this study, which created its own “spendthrift-tightwad” scale, tightwads are defined as people “who feel intense pain at the prospect of spending money, and therefore tend to spend less than they would ideally like to spend.” In fact, tightwads, which some call cheapskates, tend to underspend on many things and therefore always feel as if they’re living at a disadvantage or like they’re missing out on something. That doesn’t sound like much fun.

* Frugal
Frugal folks take great pleasure in saving money and will spend when they know they are getting the best bang for their buck. The Wharton study showed that frugal people tend to be the happiest of the three. “The more frugal you are, the happier you are,” says the study’s authors.

* Spendthrift
Spendthrifts “feel insufficient amounts of pain at the prospect of spending and therefore tend to spend more than they would ideally like to spend.” Because of their out-of-control spending, spendthrifts carry a great amount of guilt, which makes them feel unhappy.

Having once lived my life as a spendthrift, with more debt than I knew what to do with, I can tell you first hand that I am much happier now that I’m living a frugal life. I feel like I’m in control of my spending, how I feed my family and what I’m able to save each month.

I mean, my husband and I made a conscious effort to cut back on our spending in the past year because of various goals we had. One of them was to pay off our car so we could free up $400 a month. In 10 months time, we saved up the $20,000 and in August we sent a check to the bank that held the car loan. Now we have a little more financial flexibility because of the $400 we don’t have to send in car payments anymore, which is why we can afford to spend money on a Wii.

I’m frugal and I’m proud. What about you? Based on the description above, which category do you fit into–frugal, spendthrift or tightwad–and why? I’d love to hear your thoughts.