One of my oldest blogger friends, Jason at Frugal Dad, wrote this headline for a post about what happens when people see him making frugal decisions and assume he is poor.

The other day I had problems with the old van I drive to and from work. A friend saw me struggling to get it started in my employer’s parking lot, and the next day said, “Man, I felt bad watching you try to get the old van running. When do you think you’ll be able to buy a nicer car?”

Ouch. Frugal Dad’s friend assumed he was poor because he drives a skanky van. Is this what people think when they see me on my beater bike? I now know the answer is: ABSOLUTELY!

That afternoon, while standing outside waiting on a ride home, and feeling a tad bit sorry for myself, it occurred to me that living frugal often gives people the wrong perception of your financial health. When others see you making frugal choices, they automatically assume you are doing it because you have to, not because you want to. Sure, I could go out and sign the next five years away with a new car loan, but I choose not to.

We can’t control other people’s assumptions about us, but we can control the way we respond to them. Why not say, “Oh I can afford a new car, but this van has so many good memories,” Or “I’d rather put my kid through college.” Or, “I have the money to buy a new car, I just don’t want to spend my money that way.”

The fact is, most frugal people are in much better financial positions than those feeling sorry for them. The classic example is Sam Walton (of Wal-Mart), who right up until his death drove an old pickup truck around Bentonville, Arkansas. Those who didn’t recognize him probably thought he was just an average guy not able to afford a “nicer car.” We know he could have easily carved $60,000 out of his billions for a shiny new Mercedes, but he didn’t need one. His old truck suited him just fine.

A lot of frugal choices are invisible. Nobody knows how much we have socked away in our 401 (k) or savings account. What shows is our out-of-date clothes and cars, our brown bag lunches, and our hobbies – we hike, not $ki.

But just as people mis-judged Sam Walton and Frugal Dad, how many times have you assumed someone is rich because of their appearance when they are carrying loads of debt and living paycheck to paycheck? I bet it happens all the time.

Not that that is any consolation to people worried about how living frugally looks to others.

The thought of living frugal frightens many egos out there into thinking they may not appear as successful, or wealthy, if they shop at thrift stores, drive old cars, cut their own hair, clip coupons, and make their own homemade laundry detergent.

I’m sure this is true. It’s easy to say “I don’t care about what other people think about me.” But it’s basically impossible to do because we are social creatures. We care about other people, so we care what they think. The thing is to not care what everybody thinks about you, just the people you care about, and even then, in moderation. If my mother told me she was really worried about me, I would listen. Wouldn’t you?

UPDATE: KB left an amazing comment – I wish I had written it myself! (excerpted here)

While I’ve only bought one “brand-new,” car in my life, and I’ve never paid more than $100 for a blouse, I’ve managed to mingle with the rich and famous without worry or concern that I didn’t fit in…it’s in one’s carriage and attitude, I find…there is a wisdom and comfort in knowing the true value of material objects, and knowing how to face the reality of your personal situation. It is not the clothes on a persons back that determines his/her worth.

How does KB carry herself among the rich and famous? I hope she will elaborate!