What is the Illora Blueprint?
The Illora Blueprint is a seven-step process for sorting your finances. It works from the foundations up: protecting against shocks first, clearing costly debt, capturing free money, then optimising tax and investments. Following the steps creates a bite-size approach to creating a plan for your finances.
Step 1: Emergency fund and near-term spending →
The house view is to hold 3 to 6 months of essential spending in easy-access cash, and to keep money for goals under five years in cash too. This is your shock absorber: it covers a job loss or a surprise bill without forcing you to sell investments or reach for credit at the worst moment.
Step 2: High interest debt →
Clearing expensive debt, such as credit cards, generally comes before investing, because the interest usually compounds faster than investment growth. Paying it down is effectively a guaranteed, tax-free return that few investments can reliably match.
Step 3: Free employer contributions →
Contributing enough to capture the full employer pension match is rarely beaten as a return on any financial action. A match instantly boosts that slice of your savings before any investment growth, so missing it leaves money on the table.
Step 4: Salary optimisation →
Around key thresholds, pension contributions can be unusually powerful. This step covers the 60% trap between £100,000 and £125,140, the High Income Child Benefit Charge, and the £100,000 childcare cliff, where small changes to income can have an outsized effect.
Step 5: Approaching the mortgage →
Once the basics are covered, there is a choice between overpaying a mortgage and investing. It is part maths, part peace of mind: overpaying gives a guaranteed return, while investing tends to win over the long term when rates are low and allowances remain.
Step 6: Tax wrappers →
ISAs, LISAs, and pensions shelter investment growth from tax. Each wrapper has different pros and cons and so suits different goals, from a first home to retirement, so the right mix depends on your timeline.
Step 7: Protecting the plan →
Protection and a will keep the plan standing if life takes a turn. The right cover and an up-to-date will make sure everything you have built still supports the people who depend on you.
