If you’re setting up your first SIPP portfolio, the main things to decide are how long you’ll invest for, how much risk you’re comfortable taking and which ETFs fit your goals.
With an InvestEngine DIY SIPP, you can build your own pension portfolio using ETFs, with 0% platform fees and 0% dealing fees for DIY portfolios (ETF costs apply). That means more of your pension can stay invested, although the value of your investments can still go down as well as up.
This guide explains how to think about your first SIPP portfolio, how ETFs can fit inside a pension and what to consider before choosing investments.
Quick answer: how do you build your first SIPP portfolio?
To build your first SIPP portfolio, you’ll usually need to:
- Decide when you expect to access your pension
- Choose a level of investment risk you’re comfortable with
- Pick investments that match your goals and timeframe
- Check that your portfolio is diversified
- Understand the fees you’ll pay
- Review your choices over time
A simple portfolio can often be more useful than a complicated one. For example, a broad global ETF may give you exposure to hundreds or thousands of companies through one investment.
What is a SIPP portfolio?
A SIPP portfolio is the collection of investments you hold inside a self-invested personal pension.
Unlike some workplace pensions, where investment options may be chosen for you or limited to a small fund range, a SIPP gives you more control over how your pension is invested.
That control can be useful, but it also means you need to understand what you’re investing in and whether it suits your circumstances.
With an InvestEngine SIPP, DIY investors can build a pension portfolio using ETFs across different markets, asset classes and investment strategies.
Key things to consider before choosing SIPP investments
| What to think about | Why it matters |
|---|---|
| Time horizon | The longer your pension is invested, the more time it may have to recover from market falls |
| Risk level | Higher-risk investments can fluctuate more in value |
| Diversification | Spreading your money across different investments can reduce reliance on one company, sector or country |
| Fees | Lower fees can make a difference over long periods |
| Investment purpose | Each ETF should have a clear role in your portfolio |
| Review frequency | Your needs may change as you get closer to retirement |
Start with your time horizon
Your time horizon simply means how long you expect your money to remain invested before you need to start accessing it.
For pensions, that could potentially be decades.
Someone in their 20s or 30s may have many years for their investments to grow before retirement. That longer timeframe can also give them more time to recover from periods when investment markets fall.
Someone approaching retirement may have a much shorter timeframe and could have different priorities, particularly if they expect to start accessing their pension soon.
As a general principle, investors with longer time horizons may be able to tolerate more investment risk than those who expect to need their money sooner.
That doesn’t mean there’s a particular level of risk that’s right for everyone. Your own circumstances, objectives and attitude towards investment losses matter too.
Understand investment risk
Every investment involves some degree of risk.
On InvestEngine, ETFs have a risk rating from 1 to 7, which can help give you an indication of how much their value might fluctuate.
At the lower end of the scale, you might find investments such as overnight-rate ETFs, which tend to have relatively low price volatility.
Equity ETFs are generally further up the risk scale. An ETF tracking an index such as the S&P 500, for example, invests in shares in large US companies, so its value can move significantly as stock markets rise and fall.
More concentrated investments, such as ETFs focused on a particular industry, theme or emerging technology, can have higher risk ratings still.
An ETF focusing specifically on areas such as artificial intelligence, for example, may behave very differently from one investing across thousands of companies around the world.
A higher risk rating doesn’t automatically make an investment better or worse. It’s there to help you understand the level of investment risk you’re taking.
Before adding an ETF to your pension, take some time to understand what it invests in and whether the level of risk is appropriate for you.
Think about diversification
You’ve probably heard the phrase “don’t put all your eggs in one basket.”
That’s essentially what diversification is about.
Instead of relying heavily on one company, industry or country, a diversified portfolio spreads your money across different investments. If one part performs poorly, other areas may perform differently.
ETFs can make diversification relatively straightforward because a single ETF can contain hundreds or even thousands of individual investments.
For example, an ETF following a broad global index might give you exposure to companies across multiple countries and industries through just one investment.
That also means having more ETFs doesn’t necessarily mean having a more diversified portfolio.
Two or three ETFs could contain many of the same underlying companies, while one broad ETF could already provide exposure to a large part of the global stock market.
It’s worth looking at what each ETF actually holds rather than simply counting how many you have.
Why use ETFs in a pension?
ETFs, or exchange-traded funds, are investments that contain a collection of underlying assets.
Rather than buying shares in a single company, an ETF might invest in hundreds of companies at once, track a particular stock-market index or provide exposure to bonds, commodities or other parts of the market.
That can make them useful building blocks when creating a long-term portfolio.
ETFs are also generally relatively low cost, particularly index-tracking ETFs that aim to follow a market rather than employ a fund manager to actively select investments.
InvestEngine is a UK-based ETF investing platform. DIY customers can choose from a wide range of ETFs from different providers, covering different markets, asset classes and investment strategies.
InvestEngine offers a Stocks and Shares ISA, SIPP, General Investment Account and Business Investment Account. InvestEngine is authorised and regulated by the Financial Conduct Authority.
If you’re looking for examples of what other SIPP investors are choosing, you can also see our most popular SIPP ETFs in 2026. Remember, popularity doesn’t mean an ETF is necessarily right for you and past performance isn’t a guide to future returns.
Your first portfolio doesn’t need to be complicated
When you’re first choosing investments, it can be tempting to think you need to build something elaborate.
You don’t necessarily need lots of different investments to create a diversified portfolio.
A broad ETF can potentially give you exposure to hundreds or thousands of companies through a single investment, while additional ETFs can be used if you deliberately want greater exposure to particular markets, industries or types of asset.
The important thing is understanding why each investment is in your portfolio.
Before adding another ETF, it can be useful to ask yourself:
- What does this ETF invest in?
- How risky is it?
- Does it give me exposure I don’t already have?
- Why do I want it in my pension?
- Does it fit with my investment timeframe?
- What fees does it charge?
If you can answer those questions, you’re already thinking about your pension portfolio in a much more structured way.
What happens to my pension transfer?
If you’ve transferred another pension into your InvestEngine SIPP, you’ll be asked which portfolio you’d like the transfer to go into.
If your pension is being transferred as cash, that money will initially appear as cash within your chosen portfolio.
From there, you can choose how you want to invest it.
If you have AutoInvest switched on, InvestEngine can automatically invest new cash according to the ETF weightings you’ve chosen for your portfolio.
That means it’s worth setting up your portfolio and deciding how you’d like your money invested while your pension transfer is taking place.
Consider investing regularly
Your pension doesn’t have to be something you set up once and then forget about completely.
Regular contributions can help you continue building your retirement savings over time.
InvestEngine’s Savings Plans let you set up recurring contributions into your portfolio, including regular payments by Direct Debit.
You can combine this with AutoInvest so that new money is automatically invested according to the target ETF weights you’ve chosen.
This can make regular pension investing much more hands-off once you’ve decided how you want your portfolio structured.
Remember that pensions are long-term investments
Investment markets don’t move upwards in a straight line.
There will be periods when markets rise, periods when they fall and plenty of periods where very little seems to happen at all.
For someone investing towards a retirement many years away, short-term market movements are only one part of a much longer investment journey.
That doesn’t mean market falls don’t matter. It means your investment timeframe is an important part of deciding how much risk you’re willing and able to take.
As retirement gets closer, your priorities may change too. Someone expecting to access their pension within a few years may think differently about risk than someone who doesn’t expect to touch their pension for another 30 years.
It can therefore be worth reviewing your pension investments periodically rather than assuming the choices you make today will necessarily remain appropriate forever.
SIPP portfolio checklist
Before choosing investments for your SIPP, ask yourself:
- How long do I expect to remain invested?
- How much investment risk am I comfortable taking?
- What does each ETF actually invest in?
- How diversified is my portfolio?
- Am I relying too heavily on one country, sector or theme?
- What fees will I pay?
- Why have I chosen each investment?
- When will I review my portfolio?
FAQs
Can I hold ETFs in a SIPP?
Yes. With an InvestEngine SIPP, you can build your own pension portfolio using ETFs. ETFs can give you exposure to shares, bonds, commodities or other markets through a single investment.
Is one ETF enough for a pension portfolio?
It depends on the ETF and your circumstances. One broad global ETF could provide exposure to many companies across different countries and industries, while a narrow thematic ETF may be much more concentrated. The important thing is to understand what the ETF holds and whether it gives you the diversification you need.
How risky should my SIPP portfolio be?
There is no single risk level that suits everyone. Your age, retirement plans, financial position and attitude to investment losses all matter. Investors with longer time horizons may be able to take more risk, but they still need to be comfortable with the possibility of market falls.
What happens when I transfer a pension to InvestEngine?
If your pension is transferred as cash, the money will initially appear as cash within your chosen portfolio. You can then decide how to invest it. If AutoInvest is switched on, new cash can be invested automatically according to your chosen ETF weightings.
Does InvestEngine charge SIPP dealing fees?
InvestEngine charges 0% dealing fees and 0% platform fees for DIY portfolios. ETF providers may still charge their own fund costs, so it’s worth checking the ongoing charge for each ETF before investing.
Take your time
Setting up your first SIPP portfolio can feel daunting, particularly if an old workplace pension previously made most of the investment decisions for you.
But you don’t need to become an investment expert overnight.
Start by understanding:
- How long you expect to remain invested
- How much investment risk you’re comfortable taking
- What the ETFs you’re considering actually invest in
- How diversified your portfolio is
- Why you’ve chosen each investment
Once your portfolio is set up, tools such as Savings Plans and AutoInvest can help take care of some of the day-to-day work of keeping your pension invested.
And remember: choosing investments is a personal decision. InvestEngine does not provide personal financial advice. If you’re unsure which investments or level of risk are suitable for your circumstances, consider speaking to a regulated financial adviser.
Capital at risk. The value of your investments can go down as well as up, and you may get back less than you invest. Pension and tax rules depend on your circumstances and may change in the future.