New to investing in ASX shares? Here's what I wish I knew when I started

This is what I would do if I were a beginner investor again.

| More on:
Young girl starting investing by putting a coin ion a piggybank while surrounded by her parents.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Starting your investing journey with ASX shares can feel a bit like learning a new language.

There's investment jargon, there are charts, and there's someone on TV shouting about what to buy, sell, or avoid at all costs.

But here's the good news: you don't need to know everything to get started. You just need to know a few of the right things.

So, if you're new to the world of investing, here are a few simple truths that could make a big difference over the long run.

They certainly would have done for me if I had known at the start of my own journey with ASX shares.

Time is your superpower

You don't need a six-figure salary or a finance degree to become wealthy from investing — you just need time.

The longer your money is invested in ASX shares, the more chance it has to grow through compounding.

Investing $100 a month might not seem like much now, but over 30 years it can snowball into something substantial. Not because of luck, but because of patience.

For example, $100 a month compounding at 10% per annum (which is in line with historic averages) would turn into over $200,000 in three decades.

You don't have to pick the perfect stock

One of the biggest myths beginners fall for is that you need to find the next big thing. Sure, it would be amazing to find the next Pro Medicus Ltd (ASX: PME) while it is still in its infancy, but the truth is that you don't need to be a stock-picking genius to be successful.

In fact, one of the smartest ways to start is with an exchange-traded fund (ETF).

ASX ETFs give you exposure to dozens (sometimes hundreds or thousands) of companies in one go. You can buy a slice of the whole ASX 300 index with the Vanguard Australian Shares Index ETF (ASX: VAS), or tap into US tech leaders with BetaShares Nasdaq 100 ETF (ASX: NDQ).

This means that you don't need to guess which company will win — you're backing the market itself.

Dividends are more powerful than you think

A lot of beginners focus on share prices, but dividends — regular cash payments from companies — are a big part of long-term returns.

Some ASX shares pay generous, fully franked dividends that you can reinvest to buy more shares, building your portfolio faster. Think of it as getting paid to be patient.

Doing nothing is sometimes the best move

It is tempting to constantly check your ASX share portfolio, especially when markets get rocky. But one of the best things that beginner investors can learn is to stay the course. The market goes up and down — that's normal. What matters is sticking to your plan.

Selling at the first sign of red can mean missing the recovery that follows.

Foolish takeaway

Investing isn't about being perfect. It is about being consistent, thinking long term, and keeping it simple.

If you can do that — even with small amounts — you're already ahead of most people.

Should you invest $1,000 in Blink Charging Co. right now?

Before you buy Blink Charging Co. shares, consider this:

Motley Fool investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now... and Blink Charging Co. wasn't one of them.

The online investing service he’s run for over a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

And right now, Scott thinks there are 5 stocks that may be better buys...

See The 5 Stocks *Returns as of 30 April 2025

Motley Fool contributor James Mickleboro has positions in BetaShares Nasdaq 100 ETF and Pro Medicus. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended BetaShares Nasdaq 100 ETF. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has recommended Pro Medicus. The Motley Fool Australia has positions in and has recommended BetaShares Nasdaq 100 ETF. The Motley Fool Australia has recommended Pro Medicus. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on How to invest

Smiling woman with her head and arm on a desk holding $100 notes out, symbolising dividends.
How to invest

How to earn $1,000 a month in passive income from ASX shares

Want a wage from the share market? Here's how to do it.

Read more »

Male hands holding Australian dollar banknotes, symbolising dividends.
How to invest

How to build a $250,000 ASX share portfolio by 2035

Here's how you could potentially reach $250k from zero in just a decade.

Read more »

A businesswoman weighs up the stack of cash she receives, with the pile in one hand significantly more than the other hand.
How to invest

How I'd build a $20,000 annual passive income stream from these top ASX 200 shares

To earn $20,000 a year in passive income, I’d start with these three ASX 200 shares.

Read more »

a smiling picture of legendary US investment guru Warren Buffett.
How to invest

Life after Warren Buffett: other successful investors still in the game worth following

With Warren Buffett retiring it’s time to look at some other investors delivering solid returns.  

Read more »

An older woman gazes over the top of her glasses with a quizzical expression as if she is considering some information.
How to invest

How to build an ASX ETF portfolio to match your risk profile

Time for a portfolio review?

Read more »

A man sits cross-legged in a zen pose on top of his desk as papers fly around his head, keeping calm amid the volatility.
How to invest

Why market volatility is an ASX stock picker's best friend

Here's why you shouldn't fear market volatility.

Read more »

A businessman compares the growth trajectory of property versus shares.
How to invest

Why does Warren Buffett prefer shares over property?

Equities made Buffett the world's most successful investor.

Read more »

Person holding Australian dollar notes, symbolising dividends.
How to invest

Should I spend $5,000 on ASX 200 shares or ASX ETFs this month?

Where is the best place to invest these funds? Let's look at the options.

Read more »