Investing in the share market doesn't have to start with a fortune. In fact, many of Australia's most successful long-term investors began with small, regular contributions that compounded into meaningful wealth over time.
If you're wondering how to turn a modest investment habit into a portfolio that could change your financial future, here's how to get started on the ASX.
Start small but stay consistent
The most important step in building wealth is to start — even if it is with just $500 or $1,000. Modern online brokers and micro-investing apps make it easier than ever to buy ASX shares and exchange-traded funds (ETFs) with minimal upfront capital.
What matters is consistency. For example, if you invest $500 a month and earn an average return of 10% per annum, your portfolio could grow to more than $360,000 in 20 years. Increase that to $1,000 a month, and suddenly you're looking at $725,000 — all without needing to time the market.
Focus on quality
When starting out, it is tempting to chase speculative stocks in the hope of quick riches. But the real magic of wealth-building lies in owning quality businesses that compound earnings over time.
One ASX share with a proven record of delivering long-term growth is CSL Ltd (ASX: CSL), which is a global biotech leader with a history of compounding earnings through innovation and international expansion.
Another ASX share that has delivered for investors is ResMed Inc. (ASX: RMD). It is a market leader in sleep apnoea and respiratory care, benefiting from growing global health trends.
Finally, WiseTech Global Ltd (ASX: WTC) is a third ASX share that has created significant wealth for long term shareholders. It is a logistics software company leveraging the global shift to digitised supply chains.
Owning businesses like these allows investors to benefit from profit growth, share price appreciation, and sometimes dividends along the way.
Use ETFs to diversify
Building a diversified portfolio from scratch can take time. This is where ASX ETFs come in. By investing in one ETF, you can instantly access dozens or even hundreds or thousands of companies, lowering the risk that one underperforming stock derails your portfolio.
One popular option for beginner ASX investors is the Vanguard Australian Shares Index ETF (ASX: VAS), which gives investors instant access to the top 300 ASX shares.
Another popular choice is the Betashares Nasdaq 100 ETF (ASX: NDQ), which provides exposure to global technology leaders like Microsoft, Amazon, and NVIDIA.
Reinvest and review
The final step is to reinvest your returns and review your portfolio periodically.
Reinvesting dividends and continuing to add fresh capital accelerates the compounding effect. This is the process where your returns start generating their own returns.
It is equally important to review your holdings to ensure your investment thesis remains intact.
It also pays to be patient. Wealth in the share market is often built over years, not weeks. By staying disciplined and sticking to high-quality ASX investments, your portfolio can quietly grow into something substantial.
Foolish takeaway
You don't need to pick the next market darling or have a huge starting balance to succeed. A small, consistent investment plan focused on quality ASX shares and ETFs can build meaningful wealth over time.
The sooner you start, the sooner time and compounding can begin working in your favour.
