Do you have $5,000 sitting in a savings account and no immediate use for it? Then investing it into ASX 200 shares could be your first step towards becoming wealthy.
This is because if you are able to invest $5,000 into the share market once a year for a long period of time, you can turn it into considerably more.
Over the last 30 years the Australian share market has provided investors with an average annual return of 9.5%.
This means that if you had invested $5,000 into the share market each year since 1990 and earned the market return, you would be sitting on a small fortune now.
Those investments would now be worth approximately $825,000. Which I believe demonstrates how rewarding long-term buy and hold investing can be.
With that in mind, I have picked out three top ASX 200 shares which I believe could be great long term investments:
a2 Milk Company Ltd (ASX: A2M)
I think a2 Milk Company is one of the best growth shares on the ASX 200. It has been growing at an astonishing rate over the last five years and shows no signs of stopping any time soon. This is thanks to its expanding fresh milk footprint and the insatiable appetite for its infant formula in China. The good news is that it still only has a modest China consumption market share of 6.6%. I believe this gives it a long runway for growth over the next decade.
Afterpay Ltd (ASX: APT)
I think this payments company could be a fantastic long term investment. Although its shares have been on fire this year, I believe they can still climb materially higher over the next decade. This is due to its explosive growth in the United States and its massive global market opportunity. In respect to the latter, I wouldn't be surprised to see the company expand into mainland Europe and Asia in the coming years.
ResMed Inc. (ASX: RMD)
Another ASX 200 share which I think has enormous long term growth potential is ResMed. It is one of the world's leading medical device companies with a focus on the growing sleep treatment market. Given the quality of its masks and software solutions, I expect it to profit greatly from the proliferation of sleep apnoea.
