Go to main content 505.293.0500 | Contact Us Routing #307083911| Login PERSONAL BUSINESS RESOURCES JOIN Using Allowance as a Financial Tool Allowances can have an impact throughout a young person’s life by teaching basic financial knowledge and encouraging financial responsibility. Here are some common approaches that some families take towards allowances. TYING ALLOWANCES TO CHORES/GOOD GRADES/BEHAVIOR This approach rewards children for doing chores and putting effort into their schoolwork. The main benefit of this approach is that it teaches the concept that one must work as an adult to gain financial reward. However, some parents opt not to take this approach since there is some work in life (like chores or errands) that people must do even though they are not paid for it. In addition, parents must consider how they will handle it if their children would rather skip chores than earn an allowance. ALLOWANCES THAT TEACH BUDGETING Under this system, children are given a flat dollar amount each week or month and must manage it so that they can purchase the non-essential, luxury items they want, such as candy or a toy for younger children, or a special pair of shoes or video game for an older child. Higher-priced items would require the child to save his or her allowance for successive weeks or months. The reward of purchasing what they want can instill positive savings habits as well as making them aware of what things actually cost. NO ALLOWANCE Some parents choose not to give children allowances at all, but rather pay for necessities and then handle requests for non-essential items on a case-by-case basis. This approach encourages children to put some thought into why they want something and how it would impact their day-to-day life. FINANCIAL LITERACY FOR YOUR CHILD If you decide to give an allowance, think about how to encourage children to manage that money. Consider your family values and priorities. For example, you may want to encourage your child to save a portion in his or her SLFCU account, donate a portion to charity, and spend a portion. You can also involve your child in day-to-day financial tasks like budgeting for groceries or how much movie tickets and popcorn cost so that they develop a sense of what things cost when their parents aren’t paying for them. Go to main navigation PERSONAL Online Banking Savings Checking Home Loans Auto Loans Credit Cards Student Loans Investments Rates BUSINESS Business Online Banking Business Checking Business Loans Business Credit Cards Cash Management About SLFCU Business NEWS & RESOURCES Dollars & Sense Articles Budgeting Credit Building Savings Laboratory Calculators Event Calendar Avoiding Foreclosure JOIN SLFCU About Us Who Can Join? Open an Account Branch Hours Locations & ATMs Routing # 307083911 SLFCU Careers | Contact Us | Site Map Privacy & Cookie Policies | Disclosures & Fees For CA Consumers: Do Not Sell My Personal Information 800.947.5328 | 505.293.0500 Download our Mobile App Federally insured by NCUA. Your savings federally insured to at least $250,000 and backed by the full faith and credit of the United States Government. We do business in accordance with the Fair Housing Law and Equal Credit Opportunity Act. © 2021 Sandia Laboratory Federal Credit Union. All rights reserved.