How the experts would invest a SIPP at every life stage

Pension investors tend to evolve their strategies over time as they balance risk and reward in line with changing objectives, risk tolerance and time horizons.

Data from interactive investor shows how fund choices typically shift as savers move from accumulation to drawdown, with a gradual shift from growth-focused strategies towards greater emphasis on capital preservation and income as retirement approaches.

Life stage investing can provide a useful starting point, provided the approach remains flexible enough to reflect individual income needs, wider assets, tax position and investor psychology.

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“Early career, mid-career and retirement are useful reference points, but they are not instructions,” says Paul Richardson, managing director of Concept Financial Planning.

To provide a framework, we asked a panel of financial advisers, wealth managers and investment specialists to set out how they would construct a SIPP portfolio across three stages: early career accumulation, mid-career consolidation and the transition into retirement and beyond.

Early career: maximising growth

For investors in their 20s and 30s, the emphasis is on building capital through sustained equity exposure, with time doing much of the heavy lifting.

“The goal of an investor in their early career – until their mid-to-late 40s – should be to build a capital base and let compounding do the trick,” says Mihir Choughule, chartered wealth manager at Tideway Wealth. “If you’re a younger investor, with access to a SIPP locked until at least age 57 currently, then you have the opportunity to take equity risk and deal with the volatility, which most people should do.”

He suggests “as close to 100% as comfortable” in equities where there are no near-term cash requirements. Alongside broad global trackers such as the Vanguard FTSE Global All Cp Idx £ Acc (BD3RZ58) and Fidelity Index World P Acc (BJS8SJ3), he highlights the need to diversify away from US stock market concentration risk through more selective active strategies. These include Schroder Global Recovery Z Acc GBP (BYRJXL9), Artemis Global Income I Acc (B5ZX1M7) and Redwheel Global Intrinsic Val R GBP Acc (BJBPX96), alongside regional and thematic funds such as Jupiter Asian Income I GBP Acc (BZ2YND8) and VT Teviot UK Smaller Companies Net Acc (BF6X212).

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For interactive investor fund analyst Tom Bigley, a simple accumulation approach is broad global equity exposure via a passive vehicle such as the UBS Core MSCI World ETF USD acc GBP (LSE:WRDA). Investors seeking active management may prefer Capital Group UK NewPersp P ACC (BS3F739) or, for investors with a higher risk tolerance, Scottish Mortgage Ord (LSE:SMT). The public/private portfolio recently hit an all-time high on the back of its exposure to Space Exploration Technologies Corp Class A (NASDAQ:SPCX).

At Canaccord Wealth, a SIPP portfolio for an early career investor would typically sit at the highest end of its multi-asset managed portfolio range, with 97% in equities.

“These investors have an exceptionally long time horizon,” says senior investment director Paul Derrien. “By contributing regularly, they are able to buy more investments at lower valuations during periods of market stress.”

He sets out a broadly global equity allocation designed to capture diversified growth across regions and styles, with fund examples as illustrative building blocks: 27% US equities (Invesco S&P 500 Equal Weight ETF Acc GBP (LSE:SPEX)), 22% global equity income (Guinness Global Equity Income Y GBP Acc (BVYPNY2)), 18% UK equities (Fidelity Special Situations W Acc (B88V3X4)), 12% emerging markets (L&G Global Emerging Markets Index I Acc (B4KBDL2)), 11% thematic exposure (Polar Capital Global Tech I GBP Hdg Inc (BW9HD62)), alongside smaller allocations to Japan (4%, iShares MSCI Japan GBP Hedged ETF Acc (LSE:IJPH)) and Europe (3%, BlackRock European Dynamic A Acc (0049520)), with the remaining 3% in cash.

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Across the panel, the message is consistent: early stage portfolios are overwhelmingly equity-driven, with diversification achieved through region, style and theme rather than asset class.

As Katrania Lowers, chartered financial planner at Colmore Partners, puts it: “Being too cautious too early and leaving decades of compounding on the table is a far more damaging outcome than riding out a market correction.”

Asset allocation weightings for maximising long-term compounding in early career

Mid-career: balancing growth and stability

For investors in their 40s and 50s, the focus shifts from pure accumulation towards balancing continued growth with greater portfolio stability, as savings pots grow and investment decisions carry more financial and emotional weight.

Colmore Partners typically blends three multi-asset fund ranges: Columbia Threadneedle Universal MAP, Vanguard LifeStrategy and L&G Multi-Index. Investors at this stage might combine CT Universal MAP Balanced 3 Acc (BF99VZ4), Vanguard LifeStrategy 60% Equity A Acc (B3TYHH9) or Vanguard LifeStrategy 80% Equity A Acc (B4PQW15) with L&G Multi-Index 5 I Acc (B8VZ3F5) or L&G Multi-Index 6 I Acc (B95KML2).

“What changes at each life stage isn’t the framework; it’s where you sit within it,” says Lowers. “If you’re mid-career with meaningful ISAs or other investments alongside your pension, you might still carry 80-100% equity in the SIPP because your overall wealth picture is balanced elsewhere. If the pension is your only pot, a more moderate 60-80% equity position could be appropriate.”

Choughule at Tideway Wealth also points to wider financial pressures at this stage. “The priorities may change. They may have a family and associated costs such as education fees, and earnings are often at or near their peak, so tax efficiency becomes critical.”

He combines equities to protect against inflation risk with income-bearing assets such as bonds and infrastructure. Funds include Man Sterling Corp Bd Profl Acc C (BNLYQX6), Artemis Short-Duration Stgy Bd I GBP Acc (BJXPPH6), Royal London UK Government Bond M Acc (B881TW5), FTF ClearBridge Global Infras Inc WAcc (BMF7D55)andWS Ruffer Diversified Return C GBP Acc (BMWLQT5).

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For Canaccord Wealth, mid-career investors would typically sit one step down the risk spectrum at profile 6, reflecting an equity allocation of around 80%. However, Derrien suggests increasing this towards 100% following a market correction before reducing exposure again as markets recover.

“We would maintain this level to, say, five years before retirement, which should provide a long enough time horizon to ensure equity markets are at a high enough level to switch to a more conservative phase,” he adds.

Asset allocation weightings for diversifying while maintaining growth in mid-career

Transition into retirement and beyond: balancing income, stability and long-term growth

As investors approach retirement, the emphasis shifts towards generating income, preserving capital and managing sequencing risk – the danger that sharp market falls early in retirement can disproportionately damage a portfolio when withdrawals are being taken at the same time.

“Recovering from losses becomes harder once capital has already been sold to fund income needs,” says Bigley at ii.

“Multi-asset investment trusts such as Capital Gearing Ord (LSE:CGT), alongside high-quality government and corporate bond funds, can reduce portfolio volatility while maintaining some growth exposure.”

He cautions against becoming overly defensive. “While holding larger cash balances may feel safer, excessive cash exposure can create inflation risk over time, eroding purchasing power.”

For Choughule at Tideway Wealth, the solution is to separate short-term spending needs from longer-term growth assets. He suggests splitting assets into two pots: one focused on low-volatility fixed income to fund spending over the next five years, and another invested for longer-term growth.

“The first should be entirely in low-volatility bonds that offer a ‘cash plus’ return,” he says. Funds include Sanlam Ninety One Intl Crdt I1 GBP BsInc (BNYNB91), Artemis Short-Duration Stgy Bd I GBP Inc (BJXPPJ8)andRoyal London Short Duration Gilts M Inc (BD050C7).

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The remaining portfolio can maintain higher-risk exposure through equities and diversified assets, helping preserve purchasing power.

Canaccord Wealth’s retirement portfolios move down the risk spectrum, typically to risk profile 4, reflecting around 40% equities, 47% bonds, 10% alternatives and 3% cash.

“This should provide enough certainty to avoid nasty surprises in equity or bond market falls, while still delivering returns comfortably above inflation,” says Derrien.

Example holdings across government bonds, corporate credit, alternatives and equities include L&G All Stocks Gilt Index I Inc (B8387G1), Invesco Sterling Bond Z GBP Acc (BFLV578), hedge fund BH Macro GBP Ord (LSE:BHMG) and Slater Growth P Acc (B7T0G90).

Colmore Partners typically holds a cash buffer outside the SIPP. “The fund adjustment is only half the job,” says Lowers. “The other priority is a cash buffer – enough to cover one to two years of income.”

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She adds that investors approaching retirement might move towards a 60/40 split in favour of equities, reducing further if the pension is the primary income source. This could involve lower-risk multi-asset strategies such as CT Universal MAP Cautious 3 Acc (BF99VX2), Vanguard LifeStrategy 40% Equity A Inc (B41F6L4) and L&G Multi-Index 3 I Inc (B6VR4B0)or L&G Multi-Index 4 I Inc (B8VZBR3).

Lowers makes a final point for those planning ahead: the minimum pension access age will rise from 55 to 57 in 2028.

“If all your wealth is locked in a pension and you want to retire before that, structurally you can't,” she warns. “Building across wrappers – pensions, ISAs and general investments – isn’t just tax planning. It’s key for flexibility and giving yourself options.”

For the investor who is transitioning to retirement, we have linked to the income (Inc) share class where available, although accumulation (Acc) share classes are also an option.

Asset allocation weightings for preserving capital while sustaining income in retirement