Investing with Allowance Money
By Akbar Muhammad
You don’t need rich parents or special tips to start investing. You can start with $10 (or Rp 150.000) each week. Even in minor things, consistency is preferable to huge and arbitrary. Our goal is to help you build a habit that you can maintain throughout school, exams, sports, and holidays.
Dollar-cost averaging is the process of investing the same amount on the same day every week. In other words, your cost evens out over time when you purchase more shares at low prices and fewer shares at high prices. Over many months, this evens out your average cost. You aren’t guessing the “perfect” day to buy. You’re letting time reduce the role of luck.
Here, time is your best friend. When your money earns a return, and then that return earns more, that is compounding. It starts slow, like a snowball at the top of a hill; it grows as you keep rolling it. If you put $10 in every week, you will accumulate $520 in one year. If the market averages around 7% a year, that could be about $538 after a year. At first, the gain is small, but the point is the habit. If you continue for ten years, you will put in $5,200, with the same average return, that could grow to roughly $7,500.
What you actually buy when you invest
A stock is a tiny ownership slice of a company. If the company grows profits over time, the value of that slice can grow too. But companies can also stumble, face competition, or see trends change. That’s why beginners are usually better off starting with index funds or ETFs that hold many companies at once. Think of an index fund as a class photo of the market: instead of betting on one student, you own a tiny bit of the whole class. One fund can spread your risk across dozens or hundreds of businesses.
Prices move for reasons (and for noise)
Stock prices move because of information: earnings reports, new products, interest-rate changes, political news. Prices also move for noise—rumors, social media drama, or short-term trading. DCA helps you live with both. When headlines are scary and prices drop, your fixed amount simply buys more shares. When excitement pushes prices up, your fixed amount buys fewer. Either way, your routine keeps you from making panicked choices.
The beginner’s edge: keep it simple
For most students, the smartest “first portfolio” is mostly a broad index fund. It’s simple, low-effort, and usually low-fee. Why low fees? Because even a small annual fee compounds against you. Over years, high fees can quietly take a large bite from what you could have earned. You can’t control the market, but you can control costs.
What about picking individual stocks?
Picking a company you love can be a great way to learn, as long as you remember: a great product isn’t always a great investment. If you choose to explore single stocks, keep them small and treat them as a learning space. Good stock research starts with simple questions in plain English: What does the company sell? Is revenue and profit growing over the last few years? Is debt reasonable for the cash it makes? Is the current price fair compared to similar companies? Is there a clear reason to own it now—like a product launch or a real shift in the business? If those answers aren’t clear, it’s fine to wait and watch.
Investing is as much about behavior as it is about numbers. Prices will rise and fall. That can feel exciting or scary. It helps to remember your time horizon: money needed soon (next 1–3 years) doesn’t belong in risky assets. Money you won’t touch for a long time can ride out the ups and downs. Calm beats clever—especially while you’re juggling classes, sports, and exams.
What success looks like in high school
Success doesn’t mean bragging about a “10x” stock. It means:
You understand what you own (even if it’s just an index fund).
You add small amounts on a regular schedule you can actually keep.
You pay attention to fees and avoid jumping in and out on every headline.
You learn from companies you follow, not just their tickers. Reading one earnings summary teaches more than scrolling through ten hype posts.
Myths to drop now
“I’ll start when I have real money.” Waiting costs you the one thing you can’t replace: time.
“I just need the right tip.” One lucky pick can happen, but a routine is what builds wealth.
“It’s too risky.” Concentrated bets can be risky; broad, low-fee investing over years is much less so.
A simple picture to keep in mind
Imagine two students. One starts with $10 a week and keeps going through wins and losses. The other waits for the “right moment.” After a year, the first student doesn’t look much richer—but they’ve learned how markets move, how their own emotions react, and how to stay steady. Ten years later, the gap is obvious. The routine student has both more money and more investing skill.
