Lump sums are large amounts of money, paid in one go. See what they mean for savers.
Overlay
Lump sums explained
What is a lump sum?
What are lump sum payments?
A lump sum is a payment that’s made all at once, usually involving a large amount of cash. It’s different to instalments, where you receive or pay out smaller chunks of money over time.
As you go through life, there are plenty of moments when you might receive lump sums. For example:
- Money from a property sale.
- Christmas bonuses from your employer.
- Redundancy payouts.
- Gifts from friends or family.
Lump sums may come from unexpected windfalls too. Here are just a few examples:
- Winning a competition.
- Inheritance payments after a loved one passes away.
- Tax refunds from HM Revenue & Customs.
You could also build up a lump sum by gradually making savings. For example, by putting a bit of money aside each payday.
How to save a lump sum of money
Decided to save a lump sum? Comparing different savings accounts could help you find the right fit for your needs.
Information Message
Individual account eligibility criteria apply.
Terms and conditions apply.
Fixed term savings accounts
With these accounts, you can lock your lump sum away for a fixed time. For instance, leaving it untouched for one or two years.
In exchange, you’ll be given a guaranteed interest rate. This won’t change till the term ends. It may give you a clearer idea of what your money will earn.
Must be aged 16 or over and be a UK resident.
Information Message
Instant access savings accounts
Also known as easy access accounts, these can let you pay in money as and when you want to. It could be a large, one-off lump sum, or a series of smaller payments.
You can also take your cash out whenever you need it.
But the interest rate might not be as high as on fixed term savings accounts.
Must be aged 16 or over, hold a NatWest current account and be a UK resident.
Information Message
Cash ISAs
A cash ISA works like a normal savings account, except your interest should be tax-free.
You’ll just need to stay within your ISA allowance which is subject to annual limits set by HMRC.
With instant access and fixed cash ISAs available, you’ll find different options for saving lump sums.
Must be aged 18 or over and be a UK resident.
Information Message
Pros and cons of putting lump sums in savings accounts
Pros
- Opportunity to earn interest. This can give you a return on your lump sum.
- Plenty of variety. You’ll find different account features and interest rates to suit different savers.
Cons
- More pressing priorities. Saving might not be the right call if you have debts or big purchases on the horizon.
- Rules and restrictions. Some savings accounts may limit access to your lump sum. Others might come with minimum or maximum deposits.
Find an account to suit you
From instant access accounts to fixed rate options and a range of ISAs, take a look at our selection.
Bank vs savings accounts
See how bank accounts differ from savings products in our handy guide. Compare their main features.
Turn change into savings
Round Ups is available to customers who have an eligible current account, an eligible instant access savings account and are registered for the NatWest mobile app. Round Ups can only be made on debit card and contactless payments in Sterling.
Financial Services Compensation Scheme
Your eligible deposits held by a UK establishment of NatWest are protected up to a total of £120,000, by the Financial Services Compensation Scheme, the UK’s deposit guarantee scheme. Any deposits you hold above the limit are unlikely to be covered.
Read the FSCS Leaflet (PDF, 3.7 MB) to find out more about the scheme and how it protects your money.
Investments through NatWest Invest may also be covered by the Financial Services Compensation Scheme in some scenarios. You can find out more here.