Heat rises, so I'd always go for loft insulation - for the same reason that wearing a hat in winter keeps your head warm. It also helps to keep the house cool in a hot summer. You can do it yourself, even if you can't get a grant to help fund it, so it's a really cheap as well as effective way to insulate.
Cavity wall insulation isn't even possible for old houses with solid walls and, even where the walls are built with cavities, this can't be done as a DIY project. Anything that involves professional labour will cost much more.