Alongside the Self-Invested Personal Pension (SIPP), the Individual Savings Account (ISA) is a powerful weapon for building long-term wealth.

The Stocks and Shares ISA allows individuals to capitalise on the vast investment potential of shares, trusts, and funds, without having to pay a penny in capital gains tax or dividend tax.

But how much would someone need in an ISA to retire early?

Ballpark figures

There’s no definitive answer to this question. An individual who plans to travel the world and live an adventurous lifestyle will have different needs to someone who fancies kicking back and taking it easy.

The amount a person will need in retirement will also depend on where they live and their relationship status. Early retirees will have to consider other things too, like whether they’re still paying the mortgage off or have children living at home.

However, research from the Pensions and Lifetime Savings Association (PLSA) provides a handy ballpark figure on what may be needed if retiring today, based on financial goals and relationship status. The figures are:

While useful as a starting point, the cost of living and social care today is likely to be significantly lower today than 20 years from now. The level of the State Pension could also be substantially different, meaning future retirees may need more money put aside in an ISA than those retiring today.

A £74,875 target

So to get a better idea, I’ve taken into account the long-term rate of UK inflation — 2.8% — and adjusted what the PLSA says people need today for a comfortable retirement (£43,100).

Based on this calcuation, a single person hanging up their figurative work apron 20 years from now will need £74,875 a year to live comfortably.

To hit that target, they’ll need £901,250 in a Stocks and Shares ISA, assuming they then invested this sum in 6%-yielding dividend shares.

This also assumes the full State Pension grows in line with inflation of 2.8% over the period.

A top fund

That may seem like an enormous sum of money. But a balanced portfolio of blue-chip shares could make this possible.

A fund like the iShares S&P 500 ETF (LSE:CSPX), for instance, is worth considering. It’s a well-diversified product that’s delivered an average annual return of 13.2% since 2010. If this continues, a 40-year old who invested £800 here each month could have an ISA of £931,830 to retire on at 60, well before the State Pension age.

By investing in 500-odd blue-chip US companies, it provides exposure to rock-solid companies with market-leading positions and strong balance sheets. With a huge weighting of technology shares (like Nvidia and Apple), it also has substantial long-term growth potential.

Returns may disappoint during broader stock market downturns, like the one we’re seeing today. But over the long term, a fund of heavyweight shares like this produces enough wealth for an early retirement as the global economy grows over time.

The Tesla (NASDAQ:TSLA) share price keeps testing new lows in 2025. And despite US Commerce Secretary Harold Lutnick saying the stock “would never be this cheap again”, last week it’s got even cheaper.

While some analysts have argued that Trump’s tariffs are more detrimental to other vehicle manufacturers than Tesla, Elon Musk’s company hasn’t received setback after setback in recent weeks.

So with this is mind, some investors will be asking where the floor is for Tesla. One analyst says the stock should be trading closer to $120. That’s 45% below the current share price.

Not JP Morgan’s favourite

In March, before these tariffs were brought in, JP Morgan analyst Ryan Brinkman reduced Tesla’s price target from $135 to $120 while maintaining an Underweight rating on the stock.

This adjustment reflects a significantly lower forecast for vehicle deliveries and potential pricing challenges. The firm attributes these issues to shifting customer sentiment, as both current owners and prospective buyers are reacting in diverse ways, such as protesting at Tesla stores, boycotting sales, and reselling vehicles in the secondhand market.

The banking giant also highlighted CEO Musk’s controversial political role as a senior advisor to the President as a reason for this backlash. Interestingly, Tesla actually underperformed JP Morgan’s delivery expectations for the first quarter. The real figure of 336,000 was well below the bank’s estimate of 355,000.

Of course, what remains phenomenal about Tesla is that even at $120 per share, the stock would be trading at 50 times earnings. That’s in line with Ferrari, but still many times greater than other car manufacturers.

Not a car company

Tesla’s often misunderstood as a car company, but its valuation and ambitions suggest it’s much more. It wants to be seen as a technology platform with transformative potential across artificial intelligence (AI), autonomous driving, and robotics.

While electric vehicles (EVs) currently dominate Tesla’s revenue, Musk’s consistently emphasised its broader technological aspirations. This includes Full Self-Driving (FSD) and humanoid robots like Optimus.

Tesla’s AI capabilities underpin its autonomous driving efforts, relying on neural networks trained on data from millions of vehicles. Unlike competitors such as Waymo and Cruise, Tesla avoids costly LiDAR technology, focusing instead on camera-based systems and fleet learning.

This camera-based approach enables continuous improvement in real-world driving scenarios. The goal is for the upcoming robotaxi to redefine urban mobility, offering substantial margins by replacing traditional taxi services and ride-hailing platforms. Likewise, Optimus robots aim to revolutionise factory operations and potentially open new revenue streams across industries.

However, the risks are significant. Tesla’s reliance on camera-based systems for autonomy has drawn scepticism from experts who favour LiDAR for safety and precision. Moreover, rivals like Waymo have gained a headstart with driverless taxis already in operation, which could erode Tesla’s competitive edge.

As such, if Tesla fails to deliver on its bold promises — whether in autonomous driving or robotics — it risks being perceived as overvalued. It’s an incredibly hard stock to value. But for me, they’re no doubt that if its AI ventures don’t deliver, it could trade at $120 or below.

I could be very wrong and Tesla has a way of defying expectations. But I’m not buying the stock in the near term.

Looking for dip-buying opportunities following recent stock market weakness? Here are two top UK stocks and funds I think merit close attention right now.

The fund

Amid signs that US ‘exceptionalism’ could be waning, some analysts believe investors may start to switch their attention to other countries’ equity markets. If data from Hargreaves Lansdown is to be believed, this trend could already have started in earnest.

The investment platform has said that purchases of UK shares have outweighed those involving US shares by a ratio of 3:1 in recent days. As fears over the economic and political landscape Stateside grow, this is a phenomenon I think could pick up substantially.

In this climate, researching a UK stocks fund like the iShares MSCI UK IMI Leaders ETF (LSE:UKEL) could be a good idea. This exchange-traded fund (ETF) tracks the performance of a basket of British stocks, the majority of which are the big beasts of the FTSE 100 and mid-cap growth shares of the FTSE 250.

Some of the largest holdings here are Unilever, National Grid, Lloyds and Reckitt Benckiser.

In total, the fund has holdings in 144 companies, allowing investors to effectively spread risk. What’s more, it’s focused on companies with strong environmental, social and governance (ESG) characteristics. This leaves it well placed to harness rising investor demand for ethical shares.

Beware, however, that returns could disappoint if market sentiment towards UK-based assets sinks again.

The stock

Another interesting piece of trading data from Hargreaves Lansdown caught my eye recently. This showed net purchases of gold ETFs up 157% last week compared to the week before.

This is no surprise given the yellow metal’s role as a safe-haven asset in tough times. Many analysts expect gold prices to take out last week’s record high near $3,171 per ounce as macroeconomic and geopolitical uncertainty swells.

I myself purchased a fund tracking the performance of a basket of gold mining stocks to capitalise on the metal’s continued bull run. And I believe Hochschild Mining (LSE:HOC) could be a great individual stock to consider buying in the current climate.

Investing in specific mining stocks like this can be riskier than buying a fund that holds many. Project exploration, mine development and metal production can be rife with setbacks that can smack earnings and share prices. Investing across several companies reduces this risk on overall returns.

That said, I believe this risk is more than baked in to the cheapness of Hochschild’s share price. City analysts think earnings will soar 103% in 2025, leaving the company trading on a forward price-to-earnings (P/E) ratio of 8.7 times.

A sub-1 price-to-earnings growth (PEG) ratio of just 0.1 also underlines the company’s cheapness.

I also like the fact that Hochschild produces silver alongside gold from its assets across the Americas. Both these metals rise sharply in demand during uncertain times. However, silver’s wide use in industrial applications mean it can also rise sharply in price when economic conditions improve.

Alphabet (NASDAQ:GOOGL) stock is down 13.5% over one month. That’s not as bad as some of its peers, but the stock is down 25% from its highs. In other words, a £10,000 investment made one month ago would be worth £8,650 today. The pound is roughly flat against the dollar so there’s no need to account for currency fluctuations.

What’s behind the sell-off?

Alphabet, Google’s parent company, has faced a challenging year, with its stock plunging by 23.4%. The broader market sell-off has played a role. However, the decline has been exacerbated by Google’s struggles in keeping pace with competitors in AI search.

Since the rise of large language models (LLMs) in 2023, Google’s Gemini has lagged significantly behind OpenAI’s ChatGPT, missing out on the crucial first-mover advantage.

Gemini, formerly known as Bard, has encountered multiple setbacks since its launch. Its debut in March 2023 was marred by a factual error during a live demo. This caused Alphabet’s stock to nosedive before recovering.

Subsequent issues, such as challenges in image generation, further hindered Gemini’s progress. These missteps led Google to adopt a cautious approach to AI development—a strategy that has come at the expense of market share. Today, Gemini holds only 13.5% of the market.

While Gemini has some unique features — like being particularly helpful for novice coders — its overall capabilities have been underwhelming compared to competitors. Features like photo and document uploads were initially absent, and its coding skills and reasoning abilities lagged behind rivals like ChatGPT and Claude. Even though Google’s NotebookLM offered some functionalities, poor user awareness limited its impact.

AI developments

Since early 2025, CEO Sundar Pichai has pushed for faster rollouts of Gemini updates. The latest version, Gemini 2.5, introduces reasoning capabilities, marking a step forward in performance and accuracy.

According to Google, these “thinking models” can reason through their responses before delivering them. Gemini 2.5 is now better equipped for multimodal reasoning, advanced coding tasks, and complex math and science questions.

Benchmark data shows some improvement. Gemini 2.5 Pro Experimental scores higher than OpenAI’s o3-mini in areas like science (84% vs. 79.7%) and math (86.7% vs. 86.5%). However, it still trails GPT-4.5 in critical benchmarks like Factuality SimpleQA (FSQA), which measures accuracy in basic fact-based queries. This is a key metric for everyday interactions.

Looking beyond AI

While Gemini 2.5 may be a step forward, the company has some broader risks. Firstly, the US economy looks set fall into a recession this year, and that not going to be positive for Google’s advertising revenue. It currently controls more than 90% of the search market share and has a dominant position is digital advertising. Likewise, Google Cloud growth was slower than expected in recent quarters.

However, I’m tempted to look beyond these near-term challenges. And that’s why I’ve recently added a little to my portfolio. The company has catalysts in the form of Waymo — it’s robotaxi venture — and quantum computing where, I believe, big tech companies are likely to make the biggest commercial breakthroughs. It’s also trading at a 36% discount to its five-year average forward price-to-earnings. This may signal a near-term downturn in earnings. But I’m bullish in the long run.

Planning for a comfortable retirement requires careful preparation. And a Self-Invested Personal Pension (SIPP) can be a powerful tool to achieve it. SIPPs offer flexibility, tax advantages, and the ability to control our investments. But just how much do we need in your SIPP to retire without money worries?

How much is needed?

A comfortable retirement typically involves having enough income to enjoy leisure activities, travel, dining out, home improvements, and other lifestyle expenses without financial stress. According to the Pensions and Lifetime Savings Association (PLSA), the annual income required for such a lifestyle is:

• £43,100 for a single person
• £59,000 for a couple

What does this mean for my SIPP?

First, the State Pension should be factored into retirement planning. For the 2025/26 tax year, the full new State Pension is set at £230.25 per week, which equates to £11,973 annually. If eligible for this full amount, it can be subtracted from the target annual income when calculating how much is needed in a SIPP. In our example, that would mean the SIPP would need to provide £31,127 annually to hit the comfortable retirement income of £43,100 per year (as suggested by the PLSA).

Using the 4% withdrawal rule, this means approximately £780,000 is needed in the SIPP to generate the remaining income. Couples eligible for two full State Pensions would reduce their combined target by £23,946 annually.

The only issue is, I’m not retiring for 35 years. To have the same purchasing power as £780,000 today, approximately £1,851,540 would be needed in 35 years. That’s assuming an average annual inflation rate of 2.5%.

Building the pension pot

Of course, for millions of us, the issue is building that £1.85m pension pot. However, with time, consistency, and a wise investment strategy, it’s very possible. One way of achieving it would be investing £500 (including government contribution) in a SIPP monthly and achieving an annualised growth rate of 10%. This would result in £1.89m in 35 years. However, not everyone achieves a 10% return. Poor investment decisions typically lose money.

An investment to consider for building a substantial pension pot is the Scottish Mortgage Investment Trust (LSE:SMT). Managed by Baillie Gifford, the investment trust focuses on high-growth companies in innovative sectors like technology and healthcare. Its portfolio includes industry leaders such as Amazon and Nvidia, alongside emerging private companies like SpaceX, offering exposure to trends like artificial intelligence and renewable energy. It also has holdings in luxury sectors, including stocks like Ferrari and Kering, providing additional diversification.

Historically, Scottish Mortgage has delivered strong long-term returns, making it suitable for investors seeking significant growth over decades. In fact, the shares are up three fold over the decade, despite the recent downward turn.

However, the investment comes with notable risks. It employs gearing, which amplifies both gains and losses. Moreover, its focus on growth stocks means it is sensitive to market changes. Likewise, some investors will be wary that its private holdings may be illiquid.

Despite these risks, Scottish Mortgage can play a valuable role in a diversified portfolio for those with a long-term horizon. Its track record and focus on innovation make it an attractive choice for investors aiming to grow their pension pot over time. It’s an investment I continue to top up on, while acknowledging its higher risk profile.

The fall in the US stock market over the past week is sharp enough to be defined as a stock market crash. Here in the UK, the 10% fall in the last week is more in correction territory. Aside from the jargon, many investors like myself are searching to sift through the market to find cheap shares. Here’s how I do it.

Ignoring the bottom 10%

Filtering for the stocks that have seen the largest share price fall in the recent past is a good starting point for looking for opportunities. However, I always discount the worst 10%. This is because there will always be some companies that genuinely will struggle as a result of the crash.

In this case, I’m referring to the US tariffs. For example, take Aston Martin Lagonda (LSE:AML). The stock is down 29% over the past month when tariff chatter started to get serious. It is now down 64% in the last year. Yet the company hasn’t just been caught up in poor sentiment. The tariffs will genuinely impact its financials.

The 25% import tariff means Aston Martin cars sent to the US will be more expensive. If the increase is added to the car price, this could lower sales volumes. If the business keeps the price the same, profit margins will be eaten away rapidly.

Further, the impact could reach other markets around the world. For countries impacted by the tariffs, customers could cut back on spending due to weaker economic growth. In this case, luxury brands like Aston Martin could be hit hardest as the cares are not necessities.

In my view, the risk is in whether Aston Martin is able to sustainably grow the domestic UK market to offset the external hit or tariffs are removed fairly quickly.

Focus on valuation

After looking at stocks that have fallen (outside of the worst 10%), I compare the share price movements to changes in valuation. I like to use the price-to-earnings (P/E) ratio. Just because a stock has fallen 10%, the P/E ratio could still be very high, indicating it’s still overvalued.

A benchmark figure of 10 is what I use when trying to pin down a fair value. So in terms of targeting cheap shares, I’m looking for stocks that have dropped to such a level that the ratio has moved below 10. In theory, the lower the ratio the better, but there are exceptions to every rule!

Sectors of the future

To drill down even further, I take the fallen stocks with a low P/E ratio and then group the remainder into sectors. From here, I’m looking for areas that I think could do well in years to come. This would include the likes of renewable energy, AI, and healthcare.

If there are stocks in this category, I believe they are more worthy of being called cheap shares because the value further down the line should be greater. This contrasts with a shrinking sector, where the stock might look good value now but has limited scope to recover in the future.

Among the many pieces of sage advice Warren Buffett has given over the years, his belief that investors should “be fearful when others are greedy and greedy only when others are fearful” is perhaps the most memorable. Buying UK shares and other assets when markets fall can deliver substantial long-term gains.

Trying to ‘catch a falling knife’ by investing in bear markets can be a risky strategy. Yet it can also supercharge an individual’s returns over time by delivering stunning capital gains when investor confidence recovers.

It’s why I’m planning to keep buying more shares, funds, and trusts for my own portfolio.

Record buying

The scale of dip buying by retail investors has been off the charts in recent days.

On Monday (7 April), investment platform Hargreaves Lansdown enjoyed record levels of share trades. It was also a record-breaking day in terms of the amount of money being invested in financial markets, the company noted.

Hargreaves said there were “significantly more buys than sells as clients sought to benefit from big drops in equities“, with 68% of all orders being ‘buy’ instructions. This rose to 80% on Tuesday.

I myself have looked to increase my exposure to gold by purchasing the L&G Gold Producers exchange-traded fund (ETF). And I have money on call in my Self-Invested Personal Pension (SIPP) I plan to use in the coming days or weeks to pick up some bargains.

Thinking long term

The widescale resetting of worldwide trade rules feels like a seismic moment. But for share investors, it’s important to remember that stock markets have fallen during previous economic earthquakes and downturns, and come out the other side far stronger.

At times like these, I try to reassure myself with another pearl of wisdom from Warren Buffett. He said:

In the 20th century, the United States endured two world wars and other traumatic and expensive military conflicts; the Depression; a dozen or so recessions and financial panics; oil shocks; a flu epidemic; and the resignation of a disgraced president. Yet the Dow rose from 66 to 11,497.

A dirt-cheap UK share

Defence firm Babcock International (LSE:BAB) is one fallen UK share I have my eye on for a potential recovery. That’s even though new trade obstacles could cause supply chain issues and push up its costs.

Its share price has dropped almost 7% in value over the last week. At 672.5p per share today, it trades on a forward price-to-earnings (P/E) ratio of 13.2 times. This makes it one of the cheapest UK, US, or European defence shares to choose from today.

Despite the risks I’ve described, I expect Babcock shares to rebound as global arms spending climbs. Revenues rose 11% in the six months to September, reflecting its strong relationships with the UK Ministry of Defence and other NATO countries like France and Canada.

With NATO members tipped to raise arms spending to 3% of their GDPs by 2030, the long-term outlook at Babcock is bright. It’s one of several beaten-down UK shares I think are worth considering right now.

The past few days in the stock market have been like a roller coaster. Looking at one’s portfolio during such times can be alarming. The FTSE 100 flagship index of leading UK stocks has been a sea of red during some recent trading sessions.

For a long-term investor like myself, I try not to pay much attention to such short-term swings in valuation. But that does not mean I am ignoring the stock market turbulence. After all, the sort of falling share prices we have seen can sometimes signal an outstanding buying opportunity for the long-term investor.

Broad-based price falls

Across the pond, the S&P 500 index is down 11% over the past week alone (well into correction territory, though still some way from a crash).

Things look no better for UK stocks, with the FTSE 100 also down 11% over the past five days.

That may seem surprising as the US index previously looked costlier than its London equivalent. Indeed, over five years, the former is up 79% while the latter has climbed a more modest 31%.

But clearly, investors in many markets are nervous right now.

That is not limited to specific companies that are perceived to have a direct connection to the impact of US tariff moves, either. As I write this on Wednesday afternoon, 97 of the 100 shares in London’s index of blue-chip stocks are lower than they were when the market opened this morning.

Hunting for quality shares on sale

One of the three shares bucking the trend, incidentally, is JD Sports (LSE: JD).

I have been buying JD Sports shares during recent market turbulence partly because of the disconnection between short-term share price moves and what I see as the sportswear retailer’s underlying long-term value.

Despite today’s positive moves, the JD Sports share price is still 28% down since the start of 2025. I thought it was cheap at a pound – and it now trades for barely two-thirds of that!

The company has a large US business. It also makes a lot of its money selling shoes made by US companies like Nike, that are manufactured in countries such as China and Vietnam. So the tariffs are a real risk to profitability. That comes on top of multiple profit warnings issued by the firm over the past year.

Resilience in a tough market

But with a proven business model, large customer base, and unique brand, I remain upbeat about the long-term outlook for JD Sports.

A trading update today (9 April) said that it expects full-year like-for-like revenue growth for its most recent year to be about 0.3%. That is not the stuff of investor dreams, but is decent given the tough trading environment. It described the impact of US tariff changes as “uncertain“ for now.

But JD Sports, selling on a price-to-earnings ratio of 11, is an example of a share that potentially looks like a screaming bargain to me. Its share price has fallen 57% since September, yet I think the business continues to look strong.

That is not true for all shares, of course. But for the long-term investor choosing shares carefully, I think the current market is throwing up some potentially great bargains among UK stocks.