What should I upgrade?

This layout worked great for me at TH5:

http://www.clashofclans-tools.com/Layout-4309

Ok, thx for sharing :)

i would upgrade your walls, defenses, mortar like someone else said is also a priority upgrade. try and layout your base so you have good coverage with your defenses and compartments, dont lump defenses together.

K, thx a lot!

I would upgrade TownHall

Honestly, up until TH7 I wouldn't worry to much about base design. Just make sure there is a wall around you storages and you should be fine.

As to the upgrading, just try and upgrade as much as possible before each TH upgrade.