When it comes to choosing which financial institution you want to put your hard-earned money with, you have a lot of options. Not only are there banks on every corner (and now on every corner of the internet, as well!) but there is another option with a ton of great opportunities — the credit union. In this post we look at the top benefits of joining a credit union.
What is a Credit Union?
A credit union is a financial institution — very similar to a bank — with the significant difference between that the credit union is owned by the membership, not wealthy shareholders. Additionally, credit unions are typically designated as non-profit organizations under a 501(c) 1 status.
What are the benefits of joining a credit union?
While a credit union typically offers all the same benefits and services of a bank, there are also a number of benefits that a credit union can offer.
1. Lower Fees/Better Rates
Because most credit unions are considered not-for-profit entities, they are able to filter their profits back into the credit union on behalf of their membership. This means that through a credit union, you are likely to have programs with lower (or even no) fees, as well as be able to get better rates on savings accounts or even loans. But that’s not all — because a credit union is built for their membership, some offer dividend payouts throughout the year, as well.
Because a credit union is owned by — and answers to — its membership, there is a significant effort to focus on the membership, who just so happens to also be the customer. You’ll see this take shape in a number of ways — primarily through the relationship that most member service representatives have with their customers, but also in shared benefits like special accounts (Christmas Club, anyone?), member-only specials on community events, and free access to financial resources.
3. A Nationwide Network
In today’s more digital landscape, having access to a physical branch may not be a priority, but when you need someone in real life, you need to know that they are available. Fortunately, while many credit unions are very local to their own communities, they are also part of a larger network of co-op credit unions that helps to expand their footprint. That’s how, when you’re out of town or moving locations, your credit union can come with you — with a shared network of 30,000 ATMS and more than 5,000 shared branches across the country.
4. Personalized Assistance
Credit unions are founded on the cooperative principle of people helping people. While many financial institutions simply look at the bottom-line number to make a determination (approved or not approved) about your financial future, credit unions make it a point to know their members by name and get a full understanding of their financial aspirations.
You may think that with all these benefits there has to be some trade-off in the decision to go with a credit union, but the reality is that your money can work for you in a credit union with the same amount of security as you would have in a regular bank, with your deposits being insured up to $250,000 by the National Credit Union Administration.
Should you decide that joining a credit union is the right choice for you, we at Spero would love to help. We’re here to help you get your financial plan in order — whether that means opening a new savings or checking account or exploring your loan options to buy a new car. Call us or come in to one of our convenient branches for more information.
This material is for educational purposes only and is not intended to provide specific advice or recommendations for any individual.