So with all the waxing lyrical we’ve been doing about saving, you might be forgiven for thinking that it boils down to a simple concept: saving = gold star and a toffee; not saving = could do better.

That is it in a nutshell really, but there are some situations where it’s not that straightforward. What do you do if you have credit card debts you want to pay off? What do you do first? Pay off the debt or start the savings habit? And what about a mortgage? Should you try and pay it off early if you can?

Financial priorities

You will rarely be able to earn more interest on your savings, than you will pay on your borrowings, particularly if you are an Income Tax payer. So, it often makes sense to pay off your debts before you start to save.  Equally, paying off your mortgage first, if you do find yourself in a happy situation of having some spare cash, often makes sense.  But be careful though as paying of your mortgage early could incur additional charges so always check with your lender first.

You might feel that you would prefer peace of mind and an emergency lump sum set aside as your first priority.  Or it might be that you would rather maintain your mortgage at its current level and start building up a nest-egg to fund your children through university or to take that longed for trip around the world.

Whatever you do, never prioritise saving over meeting the minimum payments on your debts or your mortgage, or over the really essential things like food and electricity.

Starting to pay off

If you can cover the basics, then you do have some options.  There is no right answer, but it helps to start to think about what works best for you and your family in your particular circumstances. Whichever route you take, make an informed decision, fully clued up on the consequences. Here are some things to consider:

• What would you do if you had an emergency? Do you have the funds set aside?
• Would you be able to borrow more money if you had to?
• Are you fully on top of your debt repayments, just keeping up with them, or falling behind?
• Are you paying off the most expensive debts first? Check the rates of interest that you are being charged and prioritise the ones with the highest interest charges first.
• Do you have a specific savings objective in mind? And how important is it to you?
• Can you overpay on your mortgage without incurring an early repayment charge?
• Can you get the funds back if you need them? And how quickly?