{"id":451993,"date":"2026-03-01T12:57:08","date_gmt":"2026-03-01T12:57:08","guid":{"rendered":"https:\/\/www.newsbeep.com\/uk\/451993\/"},"modified":"2026-03-01T12:57:08","modified_gmt":"2026-03-01T12:57:08","slug":"how-much-should-a-40-year-old-put-into-an-empty-sipp-to-aim-for-a-million-by-60","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/uk\/451993\/","title":{"rendered":"How much should a 40-year old put into an empty SIPP to aim for a million by 60?"},"content":{"rendered":"

\"Rear<\/p>\n

Image source: Getty Images<\/p>\n

What could \u00a32,464 a month get you? Starting from scratch at age 40, one potential answer is a SIPP worth \u00a31m by the age of 60.<\/p>\n

Here\u2019s how.<\/p>\n

Slow and steady, with some help from HRMC<\/p>\n

That sum is based on compounding at 5% annually. That compound growth could come from either dividends or share price growth, or a combination of both.<\/p>\n

Now, share price declines could eat into the growth rate. Clearly, it is important to take time when building a diversified portfolio of blue-chip shares<\/a>.<\/p>\n

Still, on a 20-year timeframe \u2013 even recognising the likelihood of market downturns during that period \u2013 I see that 5% goal as a realistic one.<\/p>\n

By the way, like I said, the sum presumes a monthly contribution of \u00a32,464. <\/p>\n

But bear in mind that, thanks to tax relief, a basic-rate payer could put around \u00a31,972 per month into their SIPP<\/a> and the exchequer would automatically top it up to \u00a32,464.<\/p>\n

Higher and additional-rate taxpayers are entitled to even more tax relief, albeit the process is more convoluted for them. <\/p>\n

But that means that, for them, a much smaller monthly contribution would be transformed into \u00a32,464 thanks to tax relief.<\/p>\n

Quality and a long-term perspective<\/p>\n

All things considered, I do no think this approach to having a seven-figure SIPP at 60 is complicated.<\/p>\n

It requires consistency, a long-term perspective, and building a portfolio of shares that strike the right balance between potential reward and risk. With a 5% compound annual gain target I do not think that needs to be very racy.\u00a0<\/p>\n

Instead, I think it can allow for a conservative approach to risk management.<\/p>\n

1966 and all that<\/p>\n

As an example, one share I should consider is City of London Investment Trust (LSE: CTY<\/a>).<\/p>\n

This FTSE 250 investment trust has a history that stretches back to the 1860s. Its current run of annual increases in the dividend per share started in 1966.<\/p>\n

It may seem like an eternity since England last won the World Cup \u2013 but the trust\u2019s shareholders have been getting a bigger payout per share every year since then!<\/p>\n

At the moment, the yield is 3.7%: above the average for the FTSE 100 index, which is home to most of the trust\u2019s holdings, such as HSBC, Shell, and Natwest.<\/p>\n

3.7% is still below the 5% target I mentioned above, but recall that includes price moves too.<\/p>\n

The City of London Investment Trust share price hit a new all-time high last week. It has gone up 65% over the past five years alone.<\/p>\n

That is close to the 68% gain of the FTSE 100 over that period. The trust\u2019s focus on leading British blue-chip shares helps it benefit from well-known UK shares doing well, but at the risk that it will also likely suffer when the FTSE 100 does poorly.<\/p>\n

Past performance is not necessarily a guide to what will happen in future. But while City of London Investment Trust might not be the most exciting share on the London market, I expect it will likely be here for a long time yet \u2013 and hopefully still raising its dividends like clockwork.<\/p>\n

As for when England will likely next win the World Cup, well\u2026<\/p>\n","protected":false},"excerpt":{"rendered":"Image source: Getty Images What could \u00a32,464 a month get you? Starting from scratch at age 40, one…\n","protected":false},"author":2,"featured_media":373189,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[14],"tags":[84,4176,4174,4175,56,54,55],"class_list":["post-451993","post","type-post","status-publish","format-standard","has-post-thumbnail","category-personal-finance","tag-business","tag-finance","tag-personal-finance","tag-personalfinance","tag-uk","tag-united-kingdom","tag-unitedkingdom"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/451993","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/comments?post=451993"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/451993\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media\/373189"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media?parent=451993"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/categories?post=451993"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/tags?post=451993"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}