Investing can seem overwhelming when you're just starting out. There are thousands of ASX shares and global stocks to choose from, financial jargon everywhere, and the fear of making a costly mistake.
But here's the good news—you don't need to be a finance expert to grow your wealth in the share market. In fact, some of the most successful investors follow a simple, long-term strategy that anyone can use.
So, if you're a beginner wondering where to start with ASX shares, here's a straightforward guide to help you take the first steps towards building your investment portfolio.
Step 1: Think long-term with ASX shares
One of the biggest mistakes new investors will make is trying to get rich quickly. They see headlines about people making big money from meme stocks or cryptocurrencies and want in on the action. But the reality is, successful investing isn't about gambling on the next big thing—it is about building wealth steadily over time.
The share market has historically gone up over the long run, despite short-term drops and volatility. That means the best approach is to invest with a time frame of at least five to ten years, giving your money the chance to grow and compound.
Step 2: Start with ASX ETFs
If picking individual ASX shares to invest in feels intimidating and is preventing you from taking that first step, there's a simple solution—exchange-traded funds (ETFs).
ETFs are like baskets of stocks, giving you exposure to a wide range of companies with just one click of the button. This reduces your risk because you're not relying on a single company to perform well.
Some great beginner-friendly ASX ETFs include the Betashares Nasdaq 100 ETF (ASX: NDQ), the iShares S&P 500 ETF (ASX: IVV), and Vanguard Australian Shares Index ETF (ASX: VAS)
The Betashares Nasdaq 100 ETF gives investors easy access to 100 of the largest non-financial stocks on the Nasdaq index. Think tech giants like Apple (NASDAQ: AAPL), Amazon (NASDAQ: AMZN), and Netflix (NASDAQ: NFLX).
Whereas the iShares S&P 500 ETF gives investors access to the 500 largest companies on Wall Street and the Vanguard Australian Shares Index ETF provide exposure to hundreds of ASX shares.
By investing in ASX ETFs, you get almost instant diversification and avoid the stress of picking individual stocks.
Step 3: Invest consistently
You don't need a huge amount of money to start investing. One of the best strategies for beginners is dollar-cost averaging, which means investing a set amount regularly—like $100 or $500 a month—regardless of market conditions.
This strategy helps you avoid the stress of trying to time the market.
Instead of worrying about whether ASX shares are too expensive or if a crash is coming, you simply keep investing on a schedule. Over time, this smooths out the ups and downs of the market and helps you build wealth steadily.
Step 4: Avoid the noise
Once you start investing, you'll quickly realise there's always news about the share market. Some days, headlines will say the economy is booming, and stocks are soaring. Other days, the media will be full of doom and gloom about crashes and recessions.
The best investors don't panic. Instead, they ignore the noise and stick to their plan.
If you're investing for the long term, short-term drops in the market don't matter—they are actually great opportunities to buy more ASX shares at lower prices.
Step 5: Keep learning and stay patient
Investing is a journey, and the more you learn, the more confident you'll become.
Many of the world's wealthiest investors, including Warren Buffett, made their fortunes not by chasing quick gains, but by letting their investments grow over decades.
The key to success is sticking with your strategy and giving your money time to work for you.
