Comparing a credit union to a bank
Do you know the differences between a credit union and a bank? Most people, especially our younger generation doesn’t know that they could be paying more for using a bank as their primary financial institution rather than checking out a local credit union. Here are a few things that separate your local hometown credit union versus a big bank:
1) Credit unions operate on a not-for-profit status. This means they don’t pay a bunch of suits in high rise offices to play games with your savings. It also means that they are able to give back more to its members in the form of dividends and low loan rates by having a non-paid board of directors acting in the best interest of the members. This way you aren’t just a member, you are an owner. You might often here the term cooperative associated with a credit union. This means a group of people bound together under a common purpose that is mutually beneficial for the entire group…..etc. In this case ensuring you get the most out of your dollar.
2) The fees associated with accounts are fewer and often less expensive. Again because they don’t spend all your money on fancy offices and absurd bonuses to big wigs, the credit union keeps its fees low so that you aren’t spending all your hard earned money on senseless charges. The national average for an overdraft fee is around $30. That’s very steep compared what you might pay at a credit union. They also offer free services such as home banking, debit cards, checks, bill pay and free checking accounts because they are not only employees, they are also members who understand that every dollar counts.
3) They exist to serve the membership. In a world where it seems everyone is out for themselves, credit unions exist to serve their communities. They often make loans in situations where a bank would not. The employees volunteer at community functions. They pride themselves on their service towards others. After all, it is that relationship they build with their membership that keeps the doors open.
4) Low Rates. This is one of the more common and popular qualities of a credit union. Because they are member-centric their goal is to save you money, including car loans, home loans, and even credit cards. Some even offer credit building services to help get you a strong financial foothold for the future. The reverse of this is also true. They typically pay higher rates on your savings, certificates of deposit and interest bearing accounts, something those big banks don’t like to do.
5) They care. It’s hard to believe but it is true. Credit unions depend on their members. You are an owner in the company, just like the owner of a bank. Only there are several thousand members who make up the ownership rather than just one or two partners. Why is this important? Consider the idea of an institution whose only purpose is to make money and report profit to its owner. Now compare this to an institution where the members, employees, and community come first. Not to mention they usually call you by name.
Whatever your need may be, most credit unions have the resources and the willingness to help you reach it. In a time when every dollar matters, credit unions not only consider your finances, they consider you and your family.