Retiring with a $1 million share portfolio might sound ambitious, but from the perspective of a 40-year-old, it is far more achievable than many people realise.
The key ingredients are time, consistency, and a willingness to let compounding work its magic.
Let’s assume you are 40 today, have $10,000 ready to invest, and are prepared to think long term.
Starting with $10,000 at age 40
At 40, your biggest advantage is time. With 25 to 30 years until a typical retirement age, even modest, disciplined investing can snowball into something substantial.
If that initial $10,000 is invested into a diversified ASX share portfolio and earns a long-term average return of 10% per annum, it would grow to around $110,000 after 25 years, even if you never added another dollar. That alone won’t get you to $1 million, but it shows how powerful time can be.
The real magic happens when you combine that growth with regular contributions.
Consistent investing
To turn a $10,000 starting balance into a $1 million ASX share portfolio, ongoing investing in ASX shares is essential. This doesn’t require huge sacrifices, just consistency.
For example, starting with $10,000 and then investing $750 per month would grow into approximately $1 million over 25 years with a 10% average total annual return.
I believe this demonstrates that time in the market is more important than by trying to pick the perfect stock.
But which ASX shares should you buy? Let’s dig deeper into that.
What to invest in
From a 40-year-old’s perspective, the focus should be on growth rather than income. Dividends are a bonus, but the priority is owning high-quality ASX shares and/or exchange traded funds (ETFs) that can compound earnings for decades.
A sensible approach is to build a diversified portfolio that includes leading Australian shares, broad-market ETFs, and some global exposure. This reduces reliance on any single business or sector and helps smooth returns over time.
This might mean quality ASX shares like Macquarie Group Ltd (ASX: MQG) or ResMed Inc. (ASX: RMD), or ETFs such as the Betashares Nasdaq 100 ETF (ASX: NDQ) and the Vanguard Msci Index International Shares ETF (ASX: VGS).
Reinvesting dividends rather than spending them is also crucial in the accumulation phase. It may feel boring, but it significantly accelerates compounding.
Staying the course
One of the biggest risks to not reaching a $1 million portfolio is not market crashes, but investor behaviour. Over a 20 to 25-year period, there will be recessions, bear markets, and periods where investing feels uncomfortable.
From the perspective of a long-term investor, these moments are not threats but opportunities. Continuing to invest during downturns often leads to better outcomes, as new money is deployed when valuations are lower.
Overall, patience and discipline matter far more than timing the market perfectly.
Foolish takeaway
From age 40, retiring with a $1 million ASX share portfolio is not about luck. It is about starting early enough, investing consistently, and giving compounding the time it needs to work.
The post How to retire with a $1 million ASX share portfolio appeared first on The Motley Fool Australia.
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* Returns as of 18 November 2025
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More reading
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- These were the best-performing ASX 200 shares in December
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Motley Fool contributor James Mickleboro has positions in BetaShares Nasdaq 100 ETF and ResMed. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended BetaShares Nasdaq 100 ETF, Macquarie Group, and ResMed. The Motley Fool Australia has positions in and has recommended BetaShares Nasdaq 100 ETF, Macquarie Group, and ResMed. The Motley Fool Australia has recommended Vanguard Msci Index International Shares ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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