Trying to decide where you should keep your money? Or maybe you’re keeping your money at a big bank and are ready to stop paying more for less. This guide will tell you five reasons why you should ditch your bank become a Member-Owner of a Credit Union today!
1. Credit Unions Have an Emphasis on Customer Service
A credit union is a cooperative, meaning that it is owned and operated by its members, and is not owned by its stockholders like a bank. This means that credit unions typically have better customer service support because they’re made by members, for members.
2. Credit Unions Have Better Motives
Because credit unions are nonprofits, their motives are different than big banks. Rather than prioritizing profits over people, Credit Unions are looking to put their profits back into the institution, not into the pockets of wealthy shareholders.
3. Better Loan Rates
Like we hinted at in the last reason, Credit Unions are known to have better and lower loan rates compared to big banks because our profits go right back to our members in the form of great deals. Expect lower interest rates and bigger returns with a Credit Union. Don’t believe us?Take a look at our interest rates and see for yourself!
4. Insurance
Your money is safer in a Credit Unions hands because all accounts are federally insured up to $250,000 and backed by the U.S. government.
5. Earnings on Savings Accounts
Statistically, personal savings accounts from Credit Unions fare better than accounts in major banks. Grow your money faster with a Value+ Money Market account, or a share certificate.
Ready to make the switch and start owning your future? Learn more about the products, services, and financial education that the USC Credit Union offers!
FAQs
Credit unions operate to promote the well-being of their members. Profits made by credit unions are returned back to members in the form of reduced fees, higher savings rates and lower loan rates.
What's the main advantage of keeping money in a bank or credit union? ›
One of the main advantages of saving at a bank is the growth of your funds. Banks provide interest or returns on your savings balance.
What are 3 advantages of using a bank credit union? ›
Pros of credit unions
- Lower borrowing rates and higher deposit yields. Credit union profits go back to members, who are shareholders. ...
- Variety of products. ...
- Insured deposits. ...
- More personal service. ...
- Educational resources. ...
- Member-owned.
Better interest rates: Credit unions typically offer higher interest rates on savings accounts because they have lower overhead costs than banks. Similarly, they offer lower interest rates on loans. Customer service: Credit unions pride themselves on offering better customer service than banks.
Why would you save in a credit union? ›
Credit unions are financial co-operatives where members can save and lend to each other at fair rates of interest. They are non-profit organisations that have a volunteer ethos and community focus. You can become a member of a credit union if you have a common bond with other members.
What are three reasons why someone would choose a credit union over a bank? ›
Credit Union Advantages: Why Bank At A Credit Union
Higher returns, better savings, low interest on borrowings, and a sense of community – these are just a few of the benefits of credit union membership.
Is it safer to have your money in a bank or a credit union? ›
Just like banks, credit unions are federally insured; however, credit unions are not insured by the Federal Deposit Insurance Corporation (FDIC). Instead, the National Credit Union Administration (NCUA) is the federal insurer of credit unions, making them just as safe as traditional banks.
What are three benefits of keeping your money in a bank? ›
Why? Because putting your money in an FDIC-insured bank account can offer you financial safety, easy access to your funds, savings from check-cashing fees, and overall financial peace of mind.
Why should I belong to a credit union? ›
Credit unions typically charge fewer fees than banks, and the fees they do charge are far lower than what you'd pay at a bank. Also, they typically charge lower rates for loans and pay higher rates on savings. Credit unions promote financial literacy, with programs on money management for all ages.
What are the pros and cons of a bank? ›
In conclusion, traditional banking offers a range of advantages such as personalized customer service, physical branches, and a sense of security and trust. However, it also has its drawbacks, including potential fees, limited accessibility, and lengthy processes.
Before you officially make the switch, it's a good idea to consider what you could lose by deciding to bank with a credit union.
- Mobile Banking Might Be Limited or Unavailable. ...
- Fees Might Not Be as Low as You Think. ...
- Credit Card Rewards Might Be Limited. ...
- ATMs and Branches Might Not Be Convenient.
According to a study by Informa Research Services, credit unions have lower average rates on credit cards, auto loans, personal loans, and home equity lines of credit. In addition, credit unions have higher average return rates on personal savings, checking, money market, and 1-year certificate accounts.
Why do banks not like credit unions? ›
First, bankers believe it is unfair that credit unions are exempt from federal taxation while the taxes that banks pay represent a significant fraction of their earnings—33 percent last year. Second, bankers believe that credit unions have been allowed to expand far beyond their original purpose.
Are credit unions healthier than banks? ›
Credit unions are insured by the National Credit Union Administration (NCUA), whereas banks are covered by the Federal Deposit Insurance Corporation (FDIC). Both the NCUA and FDIC provide the same level of protection and will insure your deposits up to $250,000.
Is it better to put your money in a bank or credit union? ›
Credit unions tend to offer lower rates and fees as well as more personalized customer service. However, banks may offer more variety in loans and other financial products and may have larger networks that can make banking more convenient.
Should I move all my money to a credit union? ›
You'll save more money.
Instead of paying shareholders a portion of the profit generated, credit unions return their profits to their member-owners in the form of better dividends on savings, lower interest rates on loans, interest-earning checking and fewer fees.
What are some negatives of a credit union? ›
Cons
- Membership requirements. To open an account with a credit union, you must become a member. ...
- Membership fees. Some credit unions cost money to join or charge annual membership dues.
- Fewer physical branches. Credit unions may be local or regional, with limited branches outside of your area. ...
- May have fewer services.
Like banks, which are federally insured by the FDIC, credit unions are insured by the NCUA, making them just as safe as banks.
