Choosing Your Personal Financial Focus

When I first started my professional life, my main financial focus was on my career. I tried really hard to establish a great professional foundation and took on a number of hard projects, presentations, certifications, public speaking opportunities, and other challenges in order to cement a positive reputation and resume.

During that time, I didn’t put much effort into other areas of my financial life. I didn’t think much about investing at all. I thought almost nothing about frugality. I dabbled lightly in entrepreneurship, but that was pretty secondary, too.

When I began to realize that my life had changed in several ways – most importantly, my first child was born – my focus shifted from my career to frugality. I focused hard on cutting my spending and using those proceeds to dig us out of our debt hole.

After a year or two of that, Money360 really took off, so for a while I thought a lot about entrepreneurship. How could I build Money360 into a lasting business with value while still giving me the freedom to continue the writing that I enjoyed? Eventually, I built up a business – and then I sold it, allowing me to continue merely as a writer (which was my favorite part anyway).

Not too long ago, things shifted again. My focus now is perhaps more on investing than anything else. As we’ve set our sights on financial independence, I’ve realized that having a very clear investment plan that’s carefully optimized is really important for us, as having just a small difference in expense ratio or return or risk tolerance can actually make a pretty large difference for us.

Here’s the thing: all of these are valid things to focus on in terms of your financial life. Sometimes, it makes more sense to focus on frugality. At other times, your career should be on top. Maybe investing makes the most sense right now.

They don’t necessarily go in this order, either. Everyone’s life goes in a different direction and finds that different things are important at different times.

Through my own experience and through the experiences of many, many readers who have ed me over the years, I’ve come to notice that most people tend to have good reason to focus on one of those four areas at any given point in their life, and most major financial mistakes come from looking at the wrong focus at the wrong time (or, of course, from not having any focus at all).

First, before we go through these four areas, let’s address a few key points.

A person’s focus does not stay steady throughout their life. Just because you are focusing on frugality right now doesn’t mean that frugality will be central in a few years. Just because your career is the central focus of your life at this moment doesn’t mean it will be central at the end of the decade. Your focus will most likely change throughout your life – and may even change sooner than you expect.

A person can and should use low-effort tactics from other areas of focus without really distracting from their main area of focus. All of these areas do offer some low-effort tactics that are useful no matter what you’re focusing on. It’s a good idea to use those tactics from other areas no matter what your focus happens to be. For example, tactics that involve simply doing something once that causes your bills to always be lower is a frugal tactic, but those tactics make sense no matter where your focus is.

A married couple does not need to have each member with the same area of focus. In fact, I think there’s some strong value in the two members having different areas of focus. My wife has largely been career focused throughout all of this, for example, as she’s really passionate about her career due to the personal meaning it holds for her. My own focus right now, if anything, is investing, as that’s been the focus of most of my learning and thought regarding finances for the past year or two.

Now, let’s dig into each area.

Frugality and Spending Control

If there’s one central maxim of personal finance, it’s spend less than you earn. While the other areas of focus on this list focus on increasing the “earn” part of that equation, frugality is focused more on the “spend less” part of things. The goal of frugality is to trim your spending so that you have money left over with which to achieve your financial goals, whatever they may be.

When Should I Focus on Frugality?

Here are four guideposts to use to decide if frugality should be your financial focus right now.

Frugality is a good focus if you need financial change quickly. Of the four areas of focus, frugality is the one that will have the quickest financial return on your time. You can implement frugal changes that will see returns immediately; others will see financial returns within a month.

Frugality is a good focus if you don’t have much in terms of money in the bank. Most frugal strategies revolve around simply spending less money without very much (if any) initial cost. That means that this area of focus works really well for people who many not have a lot of money in the bank but do have a lot of pressing financial needs.

Frugality is a good focus if you have other life responsibilities that restrict your ability to add extra work. The other options on this list generally require you to come up with at least a little additional time in order to focus on that area. Frugality mostly integrates directly into your life, requiring little additional time and, in some cases, saving time.

Frugality is a good focus if you’re struggling with debt or with even saving a little bit of money. The other areas on this list mostly provide long term benefits, but they don’t really help too much with balancing your checkbook right now or making progress on paying off debts right now. That’s where frugality excels.

Five Key Frugality-Focused Strategies

Here are five great initial steps if frugality makes sense as your financial focus.

Reorient your food spending around preparing food and eating at home. Eating out at restaurants, picking up take-out, or getting food delivered basically means paying an enormous tax for each of your meals. You’re often paying 200% or 300% more than you would by simply preparing that same meal at home. Start preparing your own meals at home instead. If you’re intimidated by the kitchen, start off with simple stuff like sandwiches and scrambled eggs and work up to more complex things as you feel appropriate. Take leftovers to work with you, too.

Clear out the unused stuff in your closets and on your shelves and sell it. Most of us have piles of stuff in the closet that haven’t been used in ages and are sometimes even still new. Sell it! If you haven’t used an item in a year, it’s just taking up space in your home and amounts to money you haven’t used to take care of your financial problems. Hit Craigslist hard, get rid of this stuff, and apply the returns to your debts or your emergency fund.

Make your home a little more energy efficient. This involves simple steps like air sealing your home to stop drafts (which means cool air leaks in in the winter and hot air leaks in in the summer) or installing a programmable thermostat or replacing your incandescent light bulbs with LEDs. These steps reduce your energy bill over time, meaning that your monthly bills are lower for as long as you live there and that you can use the excess to address your financial problems.

Buy late model used cars and drive them until they’re unreliable. This is the most cost-effective car-buying strategy, as it gives you several years of car reliability while paying a used car price. This reduces your car payments (and, if you’re smart, eliminates them after the first car since you smartly chose to save for your next car when the first one was paid off) and your insurance all at once.

When it’s time to move, downgrade to a smaller residence and sell off any excess stuff that won’t fit. Most people live in residences much larger than they actually need, mostly as an excuse to store lots of extra stuff that they rarely use. That means you’re paying a lot to store stuff that you’re not using. Take the “closet sell-off” seriously, then move on to a smaller place. Not only will you have money in hand from your sell-off, you’ll be paying less for your rent (or mortgage) and for insurance.


Investing simply means figuring out ways to make your money work for you. Once you have a significant amount of money in the bank, you’re going to want to seriously consider how to earn a decent return for that money so that your money grows on its own. In other words, investing grows in importance as your net worth grows. With a little bit of money, optimum investing doesn’t make that much of a difference, but when the money you have to invest jumps well into the six figures, paying attention can save you or earn you tens of thousands of dollars a year – and it only grows from there.

When Should I Focus on Investing?

Here are four guideposts to use to decide if investing should be your financial focus right now.

Investing is a good strategy if you already earn far more than you spend. If you’re at a point where your earnings truly outstrip your spending, you’re in a great place to think seriously about investing. You’re already contributing quite a lot to your financial future just through your everyday life, so you might as well make some smart decisions early on as your elevator goes from the ground floor to the penthouse.

Investing is a good strategy if you have a significant amount of money available (significantly more than your annual income). If you’re already sitting on enough money to live off of for several years, good investment choices are going to start making a huge difference as to the rate at which your money grows. Putting your money in the right place means you’ll hit your big life goals much faster than you would if you didn’t think about it.

Investing is a good strategy to focus on if you would otherwise trust someone else to manage your money. Even if you obtain financial advice from others, you should be the person in charge of all of your big financial decisions and you should be able to make them fully independently. For most people, there’s nothing about investing that’s complicated enough to warrant trusting investment advisors with all of your decisions.

Investing is a good strategy if your major life goals revolve around having a significant amount of money in investments to live off of. This pretty much describes me to a tee. If your life goals basically revolve around building up a sizable investment pool so that you can live off of the returns, then investing really should be your focus.

Five Key Investing-Focused Strategies

Here are five great initial steps if investing makes sense as your financial focus.

Get educated. Learn as much as you possibly can about investing from a variety of sources. Hit the library, check out a bunch of investment books, and start reading. Devote the time needed to read a variety of books on the topic and take notes to follow up on anything you’re unsure about. Knowledge is power, especially when it comes to investing.

Know your goals. Why are you investing? What are you hoping to eventually achieve? A major part of investment is risk tolerance (how much you can tolerate losing some of your investment in order to have a strong chance at good gains) and time frame, and both of those rely on knowing what your goals are. Long term goals can tolerate a lot more risk, for example.

Know how to compare investment options. This has two separate meanings. First, you need to have a broad sense of what many of your options are regarding how to invest your money. Second, you need to know how to figure out the differences between those options. This builds upon the idea of “getting educated” and turns it into direct practical use as you’re identifying investments that will work well for you.

Take advantage of tax reduction and deferment. Many investment strategies for the future involve minimizing taxes, particularly minimizing today’s taxes. This is done through things like investing in 401(k)s so that you don’t have to pay taxes on your income today and instead pay it when you’re of retirement age, or putting money into Roth IRAs so that you don’t have to pay taxes on the returns at all once you reach age 60, or putting money into 529 college savings funds so you don’t have to pay taxes on returns for money used for education. That takes careful goal assessment and planning to pull off, but it can make a huge financial difference.

Don’t invest in things you don’t understand. Instead, spend the time to understand investment options that you encounter that aren’t clear to you. Don’t put your money in unless you understand it well.


For most people, their career is their primary method of bringing home money. Thus, knowing how to improve those career returns so that your work time earns more money per hour can be incredibly valuable. For many people early on, focusing on those career options is likely the smartest choice available to them.

When Should I Focus on My Career?

Here are four guideposts to use to decide if your career should be your financial focus right now.

Your career is a good focus if your career offers a lot of advancement opportunities. Is there plenty of opportunity to rise up the ladder in your career path? Does the long term future hold any chance of significant wage increases and other job improvements that you’ll relish? If that sounds like your career, you should be placing your focus there.

Your career is a good focus if you are very passionate about your field. Do you deeply enjoy what you’re working on, even if you’re not necessarily in love with your current workplace? Do you enjoy the actual work that you do? Again, that’s a sign that your primary career deserves real focus.

Your career is a good focus if your skill set matches the field you’re working in. Do you have the skills to make it in your career path? This doesn’t just mean learned skills, but your natural talents as well. Do they add up to success in your chosen field?

Your career is a good focus if your career path has a lot of employment opportunities. Are there a lot of companies and organizations interested in people in your career path? If you were to leave your current job for some reason, is there a pretty good chance you would quickly become re-employed? Those are signs you’re in a healthy career field, and if you have your foot in the door there, you should stick with it.

Five Key Career-Focused Strategies

Here are five great initial steps if your career makes sense as your financial focus.

Take on leadership opportunities. If your job or your career organization gives you opportunities to show leadership, take them. Don’t be afraid to be the person to raise your hand to volunteer for a tough task. Don’t be afraid to be the person that comes up with a plan to deal with a major challenge at work. Step up. Sure, you might fail sometimes, but failing while trying is better than not trying at all, and succeeding? That’s the best result of all!

Go to conferences and conventions, both to present and to build a professional network. Meetings often give you a great opportunity to demonstrate your skills and get your name out there to a large audience. Go to every meeting that you can, volunteer to present and lead if you can, and get to know a lot of people there in a meaningful way. Exchange information with them, then follow up and keep following up. Those people are gold for your career; they represent your foot in the door for countless future opportunities.

Take advantage of every educational and certification opportunity. If there are degrees and certifications that you can get that represent opportunities for further employment or more income in your field, invest the time to get those things. This is even more vital if your current employer will pay for such training. Take advantage of all of it. Not only does it add to your skill set, it provides amazing fodder for your resume.

Avoid negative talk and don’t burn bridges. In the workplace, don’t waste your time engaging in negative talk about others. If you overhear it, there’s no reason to make a big issue out of it, but don’t get involved in sharing negative thoughts. When you’re looking forward to other opportunities, don’t burn your bridges on the way out. Instead, make everything as neat and tidy as you can for the next person. That leaves you with a good reputation that you can draw on in the future.

Communicate regularly with your boss about your performance. Most of the time, when people get in trouble related to their job performance, it’s due to a confusion of expectations between the employer and their boss. Never, ever let that happen to you. Request performance reviews from your boss regularly, even more frequently than they might otherwise be scheduled. Ask your boss what you can specifically do to put yourself in position for promotion, then do it.


Entrepreneurship is a scary word for many, but I take it to mean something quite positive. It simply means discovering ways to earn income without an employer directly writing you a paycheck for your time. Freelancing work? It’s entrepreneurship. Starting a small business? It’s entrepreneurship. Making and selling a creative work? It’s entrepreneurship.

When Should I Focus on Entrepreneurship?

Here are four guideposts to use to decide if entrepreneurship should be your financial focus right now.

Entrepreneurship is a good focus if your current career path has limited advancement opportunities. If you find that your current career path has you in a place where you’re not going to be able to easily move forward no matter what you do, consider entrepreneurship as a way to utilize your skills to earn more income without rebooting into a new career path immediately.

Entrepreneurship is a good focus if you are passionate about a diversity of subjects. Many people have a strong interest in a number of areas at the same time. If something excites you outside of your current job, spend the time to figure out if there’s some way you can turn that excitement and energy into a side income.

Entrepreneurship is a good focus if you have a diverse skill set. Entrepreneurship allows people to stretch their muscles in areas that might not always be useful in their current career path. Perhaps you have some talent when it comes to writing, but your main career path doesn’t give you any opportunity to use it. Entrepreneurship gives you that outlet to ply your skills.

Entrepreneurship is a good focus if your career path has limited employment opportunities. If you work in a fairly secure job that has limited opportunities in the marketplace, such as a technician for some highly specific equipment, entrepreneurship is a great way to ensure that you have fallback opportunities no matter what happens in your primary career path.

Five Key Entrepreneurship-Focused Strategies

Here are five great initial steps if entrepreneurship makes sense as your financial focus.

Try, fail, and try again. Most entrepreneurial plans fall flat on their face. For example, I launched several blogs before Money360 saw success – all of them were failures in various ways. I tried launching several other small businesses – all failures. You’re going to fail. The key to entrepreneurship is to keep trying and to learn from those failures.

Look for opportunities that can provide passive income. Passive income refers to any form of income earned without actively investing effort. Usually, passive income is the result of investing a lot of time and effort (or money) up front. There are many ways to do this: creating websites, writing ebooks, making Youtube videos, writing books, selling audio recordings, and so on.

Build skills that will be useful in a lot of areas. Transferable skills are what really matters when it comes to entrepreneurship. Do you have the ability to manage your time well? Do you have the ability to manage lots of pieces of information well? Can you focus on the task at hand? Can you speak confidently to a group of people? Those are the skills that put people on top when it comes to entrepreneurship.

Set up a strong accounting plan as early as possible. Before you even get started, make sure that (at the very least) you’re keeping all of your business income and expenses completely separate from your personal income and expenses. You should also set up a legal business entity (find out how to do this in your state) to protect your personal assets from anything that might happen to your businesses.

Develop a smart business plan for each of your endeavors. No matter what entrepreneurial angle you choose to take, you should always write a thorough business plan for that endeavor. Hit the library, check out a great guide to writing a business plan, and put in the footwork to do it properly. It will force you to think up front about the issues and challenges related to that business so that you’re not implementing poor solutions on the fly. Have others read your plan and critique it for you, too.

Final Thoughts

Different people have different financial areas of focus at different points in their lives. Knowing your area of focus and bearing down on strategies that serve that area of focus can be really useful, but it’s also useful to know that such areas aren’t permanent and that there are always low-effort tactics you can pull out of other areas to serve you in whatever your goals may be.

Good luck!

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