The Money Handbookthemoneyhandbook.co.uk
Nine steps, in the order they actually go in. You are not behind because you are bad with money. You are behind because nobody ever told you the order.
Work down the list. Stop when you run out of money. Pick it up again next month. You are never doing all nine at once, and getting to step four is not failing at step five.
Not what you think it costs. What it costs. Three minutes in your banking app adding up a normal month gets you close enough.
Every step below is measured in months, so without this number none of the rest of it means anything.
Every bill and every minimum payment up to date. Nothing further down this list matters while something is in arrears, because arrears cost more than anything below can earn. If this is where you are, this is the whole job this month, and that is fine.
Not invested, not locked away. A separate savings account you can reach in a day.
This money has one job: it turns a broken boiler from a crisis into an annoyance. The day you have it, something in the back of your head goes quiet.
The highest return you will ever get, and the step people skip for years. If your employer matches up to 5% and you are paying in 3%, you are turning down a pay rise, in writing, every month.
Log in to your pension portal and find out what your employer will actually match. Most people have never looked. If you only ever do one thing off this page, do this one.
Credit cards, overdrafts, buy now pay later, most car finance. Highest rate first. Nothing you can buy pays you 20% odds on, guaranteed and tax free, but clearing a card charging 24% does exactly that.
Not your student loan. It comes out as a percentage of what you earn above a threshold, it drops if your income drops, and it gets written off eventually. That behaves far more like a graduate tax than a debt, and overpaying it early is a bet many people never win. Find out which plan you are on before you decide anything.
Three if your job is steady and someone else is also earning. Six if you are self employed, on commission, or the only income in the house.
Keep it easy access, and keep it somewhere that actually pays a rate. A big pile of cash in a current account paying nothing is a quiet loss every year, and it is the most common place people leave serious money.
£4,000 a year in, and the government adds 25% on top, up to £1,000 a year. For a first time buyer it is close to the best deal in the British tax system, and it is the account American guides never mention.
Two catches. Take the money out for anything other than a first home or retirement from 60 and you pay a charge that takes back more than the bonus gave you. And there is a cap on the price of the home you can use it for, which has not moved in years while house prices have, so check the current limit covers the kind of place you would actually buy.
You get a £20,000 allowance a year across all your ISAs, and anything inside grows without you paying tax on the growth. This is the step where money stops being stored and starts compounding. What goes inside it is a decision for another day.
Above the match, extra contributions get relief at your rate of tax, so they are worth more the more you earn.
Two situations where this stops being ordinary. If you are a higher rate taxpayer. And if you earn between £100,000 and £125,140, where your personal allowance is stripped away by £1 for every £2, and the effective rate on that slice of income is brutal. If that is you, this is not step eight, it is closer to step one.
Mortgage overpayments, a general investment account, whatever you are actually saving for. By this point you have taken every free pound on the table and you are choosing between good options instead of missing obvious ones.
If you are a Scottish taxpayer, your rates and bands are different from the ones above. The order does not change. The numbers do.
Figures are for the 2026/27 tax year. Allowances move, so check anything you are about to act on.
Your ticks save in this browser, so you can come back to this next month.
The Money Handbook is educational content, not financial advice, and nothing here is a personal recommendation. It explains how these things work so you can make your own call, and it does not know your situation. For advice on yours, speak to an FCA authorised adviser.