What is the best way to save a lump sum in the UK?
Where a link is marked *, it is a partner link — we receive commission at no extra cost to you. Links without a * earn us nothing. How we make money.
In short: Split the sum across easy-access cash for emergencies, fixed-term bonds for higher rates on money you will not need soon, and ISAs if you are a higher-rate taxpayer or expect to exceed your Personal Savings Allowance. For five years or more, consider a Stocks & Shares ISA.
Last reviewed:
Reviewed by Kaiser Khan
Start by keeping three to six months of essential spending in an easy-access account you can reach within a day or two. For 2026/27, top easy-access rates often sit below fixed bonds but give flexibility if you might need the money for a house deposit, tax bill or unexpected expense.
Money you will not touch for one to five years can go into fixed-rate bonds or fixed ISAs, which typically pay more in return for locking the cash away. If you are a higher-rate taxpayer — Personal Savings Allowance £500 — or additional-rate taxpayer — £0 allowance — a Cash ISA shelters interest completely up to the £20,000 annual ISA limit.
For horizons of five years or longer, a Stocks & Shares ISA offers tax-free growth potential that historically has beaten cash after inflation, though values can fall. Splitting a large lump sum across providers can also keep each balance within the £85,000 FSCS limit per banking licence.
Primary source: gov.uk/individual-savings-accounts
Part of our Savings & ISAs
This quick answer sits inside our wider savings & isas hub — with sub-guides, calculators and step-by-step explainers on the same topic.
Read the full savings & ISAs guide →