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This is a four-part series on how to invest lump sums, whether you come into £5,000, £10,000, £20,000 or £50,000.
Investing a £20,000 well is a difficult task for even experienced investors. A pot this size allows flexibility but with thousands of funds available, that all claim to be the best, and endless industry jargon to wade through the opportunities for misinformation and mistakes are everywhere.
Telegraph Money takes you through the best ways to invest such a windfall depending on how long you you can leave your savings untouched.
Under five years
This is considered short term in the investment world. Any money that needs to be accessed within five years should be put away in "defensive" investments that limit, or stop, your savings losing value rather than focusing on growing it.
The ultimate haven is cash which can only be devalued by inflation. However, savers pay a high price for the security.
Until now, National Savings and Investments, offered the best easy-access account paying just 1.16pc interest. However, this is being cut to 0.01pc in November. Coventry Building Society now offers the best rate of 1.1pc.
Savers can buy fixed-term bonds to get higher rates but this comes at the cost of not being able to access your money for a set period.
The best one-year bond pays 1.21pc, from Charter Savings Bank, and the best three-year account 1.5pc (The Access Bank UK). However, the added reward is potentially not worth the restrictions.
Part of the windfall could be placed into a bond fund. This is likely to beat the returns from cash and be less volatile than the stock market. However, there is still a chance the savings could fall in value over short periods.
The TwentyFour Dynamic Bond on the "Telegraph 25" list of our favourite funds. It is a “strategic bond fund" where the manager is able to select from a range debt including government and corporate bond.
Stocks can be bought as long as the money is spread out across lots of companies. The most cost-efficient way of doing this is via Vanguard’s "LifeStrategy" range.
The lowest-risk option is LifeStrategy 20pc Equity Fund. This has 20pc invested in stocks from around the world and 80pc in bonds.
The group recommends it for investors with between three and five years to invest and charges just 0.22pc for the fund and 0.15pc for an Isa.
£20k windfall funds
Between five and 10 years
Inexperienced investors are best served by a "multi-asset" fund. This spreads savings across stocks and bonds, and may include commodities or even property. Fund managers have a license to scour financial markets for the best opportunities available to help grow, but also protect, savings.
Tom Stevenson, of investment group Fidelity Personal Investing, recommended the £1.8bn Royal London Sustainable Diversified Trust.
Another option for a hands-off investors is to buy a ready made "fund of funds", according to Claire Walsh, of Schroders Personal Wealth, an investment manager.
The largest stock brokers offer options depending on how much risk investors want to take. Higher-risk funds offer higher returns but are more likely to lose value over short periods.
A fund made up of other funds spreads the risk across different stocks, bonds and fund managers. Even a handful of bad investments would not damage your windfall.
However, active fund managers charge higher fees which eat into returns. AJ Bell Youinvest’s ready made portfolios cost 0.8pc on top of the 0.25pc fee to have an Isa.
Cost-conscious investors could stick to Vanguard’s passive LifeStrategy range. It also has different risk options with different time periods before they need to use their savings, as shown below.
Over 10 years
Investors should not have to worry about short-term dips in stock markets and funds that own high-growth but high-risk companies are on the menu.
Rob Morgan, of wealth manager Charles Stanley, recommended the Franklin UK Smaller Companies fund. Smaller companies offer greater potential to grow than larger ones if left for long periods.
He also recommended the Smithson Investment Trust which owns global stocks. The trust, which is managed by famed fund manager Terry Smith’s Fundsmith group, invests in small but "high quality" companies such as American data group Verisk Analytics and Domino’s Pizza.
Investors should seek to spread their savings across different types of businesses, even over a long period.
It is sensible to balance technology stocks, which can grow very quickly, with "quality" stocks that produce lots of cash. Value stocks, which trade cheaply but are expected to bounce back, should also be considered.
A three-way split could be achieved by the L&G Technology Index, Fundsmith Equity and Man GLG Undervalued Assets.
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