Idiom: lump sum; used as a noun
Abel: Hey Sandra, I heard about you winning the lottery?
Sandra: Yep! I won $10 million!
Abel: Wow, that's amazing!
Sandra: Yeah, I still have to decide if I'm going to take the annuity or lump sum.
Abel: What's that?
Sandra: Well, taking an annuity means I get the whole $10 million, but it will come in payments over 20 years. If I want everything at once, I can take a lump sum payment, but it will be a bit less than $7 million.
Abel: Oh, that is a tough decision.
Meaning: The term "lump sum" is used for large payments, usually made when some kind of payment plan is also an option. These options are common with lottery winnings (like the example above) and retirement payments). In the example above, Sandra is unsure if she should take a lump sum or annuity payment on her lottery winning. The phrase can also be used when making payments, such as in the following example:
Timothy owes $1500 in taxes. He has the option of paying it all off in a lump sum, or he can make payments to the IRS, but if he decides to make payments, he'll have to pay an additional fee and interest. It will end up costing him closer to $2000 in the long run.
Meaning: In this case, Timothy owes taxes, so the lump sum would be a payment he makes instead of receives.
This idiom is from LSI's new edition of "Reading Horizons," which will be used in the Level 6 Reading classes. For more information, please visit http://www.languagesystems.com/