While expanding my turf, I also am planning my budget, and investing in research in various fields. You can invest in land technology, naval technology, stability, trade, or infrastructure. As your land technology improves, your army fights better, gains the use of guns and artillery, and fortresses gain more defensive capability. As naval technology increases, better ships become available, and attrition rates go down for long tours of duty. Trade research allows the ability to settle into trading posts, place traders at centers of trade, increases revenue from these two structures, and allows you to hold monopolies.
Infrastructure allows promotion of city officials, and better tax systems.
Stability, being important enough for it's own paragraph, is rather difficult to explain. Basically, because of the Christian framework of Europe, and the Muslim framework of the Middle East, the religious ideals of acceptable behavior became ingrained in the center of the civilizations and governments. As a result of this, breaking these rules would cause other leaders, as well as citizens of your own country, to look upon you negatively. Let's talk about this whole economy and bankruptcy thing. Remember, on this scenario I started with 2500 gold.