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Do you get an allowance? Expecting money for your birthday? If yes, you might enjoy spend­ing the money on some really fun things like going to the movies or buying video games.

But what if you want something that costs more than your weekly allowance? That’s when you have to start saving money. Let’s say your weekly allowance is ¥1,000. You want to buy a new music CD or DVD that costs ¥3,000. If you save all of your allowance instead of spending it, you will be able to buy that CD or DVD in three weeks. So saving money instead of spending it is a good idea, because it lets you buy really cool stuff, like a pair of basketball shoes, a pet lizard, or even a new bike.

If you really want the bike—or even a car for when you’re old enough to drive—it’ll take a lot more than three weeks to save for it. That means you need to consider investing some of your money. Investing is similar to saving, except that you put your money into things that can increase the value of your money at a faster rate.

With your parents’ help, you can invest your money in mutual funds. These can help your money grow from a small amount to a large amount over time. For instance, if you save all of your allowance for a whole year, you’d have ¥52,000. If you did that for a whopping five years, you’d have ¥260,000. But, if you saved your allowance in a mutual fund, you may have ¥320,497—a whole ¥60,497 more! That’s because your money can grow in value when you invest it into mutual funds and this example assumes that it grows eight percent per year. Your mutual fund might even do better, which would give you even more money in the future. It’s important that you know that your mutual fund can go down in value, too—and that’s why you should think of investing your money only if you will leave the money in the fund for several years.

So the next time you get your allowance, or you get money for doing special chores, don’t forget to save some for short-term things and invest some for big purchases in the long-term. You’ll be glad you did.

Give a Little, Get a Lot
In addition to spending your money on things that only you will enjoy, why not share some of your mon­ey with people who need your help? Think about do­nating some of your money to help a needy cause you really believe in, like helping to save the whales or to feed the homeless.

You’ll discover that helping others by giving them some of your money can be a very rewarding experi­ence. Not only will you feel good about yourself, but you’ll also be helping make the world a better place. And that’s the best investment of all.