How many financial priorities do you have? Do you spare money in certain facets of your life in order to have a large percentage available for a few important goals? Or do you spread your money everywhere under the sun — thin and sparse?

After I graduated college, wife and I wondered what to do with two incomes. Do we pay extra on a home mortgage? Do we pay off our student loans? Or do we squirrel away money in savings?

Or, should we do all three?

When we tried to split up the second income three ways, it practically disappeared. It wouldn’t have made much of a dent in the mortgage. Student loans would barely get paid off earlier than normal. And it would take ages for savings to accumulate.

No matter how much we did the math, splitting up our expendable income into several worthy goals was disappointing at best. It meant telling our money to go in different directions. You guys pay down debt over there, while the other guys go into savings over here.

So we did something unconventional. *gasp*

We focused our money on one thing at a time. We threw every penny we could find at student loans while we rented on the cheap. Once we were debt free, we squirreled money away into savings as an emergency fund.

One goal. One direction. One focus. Once you accomplish the goal, move on to the next.

It was tough. It meant saying no to plenty of good opportunities which came along. It’s hard to say no when you answer only to yourself.

But it worked! Focusing your money (and effort) really does pay off. And after our experience, you’ll never hear us recommend using your money any other way.

Not convinced? Still tempted to split your money into a dozen buckets and attack all of your financial goals at once?

Well, it may be a decade or two before you have much progress to show for it.