Retirement wealth plan: Create $1 million with a single Australian stock

Although I’m technically a few decades away from the traditional retirement age, I’m already planning for a life beyond 9-5. That planning involves investing in ASX shares that will hopefully be paying my bills one day. There’s one stock in my portfolio that I have placed a lot of faith in to get me there faster. I have every confidence that this Australian stock will be worth $1 million alone one day.

That stock is investing house Washington H. Soul Pattinson and Co Ltd (ASX: SOL), a stock that has been on the ASX for more than a century.

Washington H. Soul Pattinson, or Soul Patts for short, is a company that functions more like an investor itself than a producer of goods or services. It owns a vast underlying portfolio of assets that it manages on behalf of its investors. These assets consist of stakes in other ASX shares, property, venture capital investments and private credit, amongst others.

Soul Patts has been a proven Australian stock market performer for many years now. Back in September, the company told investors that it had delivered a total shareholder return (growth plus dividends) of 13.7% per annum over the 25 years to 23 September 2025. That beat the performance of the S&P/ASX 200 Index (ASX: XJO) by 5.1% per annum over the same period.

Of course, past performance is never a guarantee of future success. But 25 years of outperforming the broader Australian stock market is still a rare achievement. As is delivering an annual dividend increase every year since 1998 – a feat unmatched by any other Australian stock.

How to turn $10,000 into $1 million with an Australian stock

I’ve built Soul Patts into one of my portfolio’s largest positions with the hope and expectation that its 13.7% annual return will continue well into the future.

Let’s, for a moment, assume that Soul Patts will be able to keep to that 13.7% return going forward. How long would it take for this Australian stock to compound its way to $1 million?

Well, let’s say an investor puts $10,000 into Soul Patts stock, reinvests all dividends, and adds an additional $500 every month. At 13.7% per annum, that investor would have $1 million to their name after 22 years. That’s easily enough to help that investor into an early retirement.

Let’s up the ante and say our investor initially invests $20,000 and puts another $1,000 in every month. Well, under this scenario, that investor will hit six figures after 17 years. For an investor who starts this process at 25, they will have $1 million in Soul Patts shares well before age 40.

Of course, Soul Patts might not be able to hit 13.7% per annum forever. But a long track record of outperformance is worth an awful lot in the Australian stock investing world. I’m happy to hitch my financial cart to this wagon.

The post Retirement wealth plan: Create $1 million with a single Australian stock appeared first on The Motley Fool Australia.

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Motley Fool contributor Sebastian Bowen has positions in Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has positions in and has recommended Washington H. Soul Pattinson and Company Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.