How to build a $250,000 ASX share portfolio starting at zero

Most people assume wealth is built by starting big.

In reality, it usually starts quietly. A decision to invest consistently. A habit that runs in the background. Over time, those small actions can snowball into something meaningful.

If you start from zero, invest $500 a month, and achieve an average return of 10% per annum, building a $250,000 ASX share portfolio is entirely realistic. Here is how you could approach it.

The timeline

At a 10% annual return, investing $500 every month allows compounding to do its thing.

Over roughly 17 years, those monthly contributions can grow into a portfolio valued at about $250,000.

The early years can feel slow. Progress looks modest at first, and it can be tempting to lose patience. But as your portfolio grows, the compounding effect becomes far more noticeable, and the curve starts to steepen.

Focusing on quality ASX shares

The most reliable long-term results tend to come from owning high-quality ASX shares with strong competitive positions and positive long term growth outlooks. These are the companies that can keep growing through different economic environments.

Examples of the types of businesses that fit this description include CSL Ltd (ASX: CSL) in plasma therapies, Cochlear Ltd (ASX: COH) in hearing devices, and Goodman Group (ASX: GMG) in logistics and digital infrastructure. Defensive shares like Woolworths Group Ltd (ASX: WOW) and diversified leaders such as Macquarie Group Ltd (ASX: MQG) can also play an important role.

Don’t forget to reinvest dividends

The Australian share market is one of the most generous in the world when it comes to dividends.

But you will want to remember to reinvest those dividends when you receive them. After all, if you were to generate a 3% dividend yield across your portfolio and didn’t reinvest, you would be slowing down the compounding process meaningfully.

For example, $500 a month compounding by 7% per annum would only be approximately $190,000 after 17 years. That’s $60,000 less than if you had reinvested the dividends.

Once your portfolio reaches a meaningful size, you could choose to start using dividends as income. But if your aim is to build wealth quickly, reinvestment gives compounding the best chance to work.

Foolish takeaway

Building a $250,000 ASX share portfolio from nothing does not require perfect decisions or special insight.

By investing $500 a month into quality ASX shares and earning an average return of 10% per annum, that goal can be reached in around 17 years.

You just need a combination of patience, discipline, and time.

The post How to build a $250,000 ASX share portfolio starting at zero appeared first on The Motley Fool Australia.

More reading

• Top Australian stocks to buy with $5,000 in 2026
• 2 strong ASX 200 blue chip shares to buy with $7,000
• Why I think this ASX small-cap stock is a bargain at $2.55
• How I’d build a high-conviction ASX share portfolio
• Here are the top 10 ASX 200 shares today

Motley Fool contributor James Mickleboro has positions in CSL, Cochlear, Goodman Group, and Woolworths Group. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended CSL, Cochlear, Goodman Group, and Macquarie Group. The Motley Fool Australia has positions in and has recommended Macquarie Group and Woolworths Group. The Motley Fool Australia has recommended CSL, Cochlear, and Goodman Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.