How to become a millionaire with a $5,000 investment in ASX 200 shares each year

$5,000 investments into Altium Limited (ASX:ALU) and these ASX 200 shares could put you on a path to becoming a millionaire…

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As I mentioned here yesterday, the Australian share market has generated an average total return of 9.2% per annum over the last three decades.

Although we have had a poor start to the current decade, I still feel confident that the market will generate a similarly strong return over the next 30 years.

In light of this, I think investors should look to invest what they can in the share market consistently over the long term to take advantage of compounding.

For example, if you were to invest $5,000 every year into the share market for 30 years and earned a 9.2% return per annum, your investments would grow to be worth almost $775,000 at the end of the period.

And if you can maintain this for just another 5 years, you'll see the value of your investments rise to over $1.2 million.

To help you on your way with the first $5,000 investment, I have picked out three top shares that I think would be great long term options. They are as follows:

Altium Limited (ASX: ALU)

The first share to consider investing $5,000 into is Altium. It is an electronic design software platform provider which is leveraged to the rapidly growing Internet of Things (IoT) market. Given its leadership position and the explosive growth expected from the market, I believe it is well placed to deliver strong earnings growth over the next decade.

Cochlear Limited (ASX: COH)

Another great long term option could be this hearing solutions company. While Cochlear is facing a few headwinds at the moment from the pandemic, I expect it to bounce back once the crisis passes. After all, hearing doesn't generally fix itself. So, the sales it is missing out on now are not likely to be lost completely. In addition to this, with populations ageing around the world, I believe demand for its products will grow over the next decade or two.

SEEK Limited (ASX: SEK)

A final option to consider is SEEK. As with Cochlear, it is facing headwinds from the pandemic. But I'm confident things will improve when the crisis passes and for its growth to resume. Management has set itself an aspirational revenue target of $5 billion by FY 2025. While I suspect this may need to be pushed back a touch, I expect it will achieve it this decade. This will be a big lift on FY 2019's revenue of $1,537.3 million.

James Mickleboro owns shares of SEEK Limited. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of Cochlear Ltd. The Motley Fool Australia owns shares of Altium. The Motley Fool Australia has recommended Cochlear Ltd. and SEEK Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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