As you know, there are several different types of bloggers in the personal finance community. There are the ones focused on paying off debt (like me), there are those who are focused on saving for early retirement, and there are those who are frugal so they pursue their passion no matter how little it pays. There’s something for everyone to read, learn from, and relate to. Personally I like reading a little bit of everything so I can get lots of different perspectives on personal finance.
Because I read lots of different blogs with lots of different perspectives, I sometimes have a hard time maintaining a laser focus on my biggest goal: getting out of consumer and student loan debt ASAP. But is that such a bad thing? Aren’t all financial priorities important?
A few months ago I decided that it is not only important for me to get out of debt, but it’s also important for me to continue to save money in my emergency fund and for my future retirement. In fact, saving for retirement from an early age is about the only financial mistake I haven’t made!
With that said, here are some factors you should weigh to help you decide if you should be laser focused on one goal, or more rounded in pursuing your financial priorities.
Rate of Progress
Obviously, if you decide to only focus on one financial goal at a time, your progress will be much faster than if you are splitting your priorities. Sometimes it’s easier for people to only have one goal at a time so they don’t lose focus or momentum when they are on a roll. I get that, really. But the reason I decided to split my priorities is to make sure I have something to fall back on “in case”.
Life Situation Considerations
I’ve read posts from other personal finance bloggers about why their life situation doesn’t warrant the need for an emergency fund while they pay off debt. For instance, if you are a non-homeowner and non-car owner, you may not think you need a large emergency fund (or even an emergency fund at all). However, because I’m both a car owner and a homeowner, I decided to work on building an emergency fund simultaneously while paying off my debt.
Peace of Mind
Most people who are in favor of continuing to save money in an emergency fund and/or a retirement fund while paying off debt do so for peace of mind. I think this can go both ways. Personally I feel more at peace as my savings fund grows but also as my debt balance and required monthly payments drop. As I continue to work my way out of debt, it’s nice to know that eventually the money I earn will be mine to do with as I please.
There’s no right or wrong answer when it comes to deciding if you should be laser focused on one financial goal at a time. It really comes down to personal preference and what works best for you. The most important thing is that you are making progress toward your financial goals, no matter what they are.
Do you pay off debt with a laser focus or more balanced financial priorities? Let us know your thoughts below!