The Australian share market has made countless millionaires since it was established in 1987.
And the good news is that there's nothing to stop you from trying to be one of them in the future.
But how long does it take to become a millionaire with ASX shares? Let's take a look and find out.
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Becoming a millionaire with ASX shares
History shows that with a combination of capital, time, and compounding, investments in ASX shares can grow into something significant.
But how much capital do we need? Well, the more capital you can put in, the less time you will need.
For example, based on an expected (but not guaranteed) average return of 10% per annum, which is in line with historical averages, it would take you approximately 29.7 years to grow a million-dollar portfolio by investing $500 a month into ASX shares.
That means that if you were 20 years old, you would be a millionaire when you turned 50.
But if you're either older than this or simply want to get there quicker, you can do so by putting a little extra into ASX shares each month.
If you were to put in $1,000 a month into the share market, it would take you approximately 23 years to reach your goal.
Have more money to invest? Well, increasing your monthly contribution to $2,000 would get you to one million dollars in under 17 years.
And finally, if you're lucky enough to have $5,000 spare to invest into ASX shares each month, you would reach your $1 million portfolio goal in 10 years.
In summary:
- $500 – 29.7 years
- $1,000 – 23 years
- $2,000 – 17 years
- $5,000 – 10 years
It is also worth noting that you could increase your monthly contributions as your wage grows over the years, which would cut down the time it takes to reach your goal.
