Hey y'all-Join a credit union!

[CommonHumanity]

Today I'm encouraging for folks to leave their bank and join a credit union.

In case you haven't been a credit union member, I've pasted a quick blurb from mycreditunion.gov below. I've also posted a link to the same site at the end of this posting in case you want to learn more or have questions. You can also send questions to me and I'll do my best to answer them.

"A credit union is a not-for-profit financial institution that accepts deposits, make loans, and provides a wide array of other financial services and products. Deposits are insured by the National Credit Union Share Insurance Fund, which is managed by The National Credit Union Administration, commonly referred to as NCUA. Backed by the full faith and credit of the United States, the Share Insurance Fund insures the accounts of millions of account holders in all federal credit unions and the vast majority of state-chartered credit unions. The standard share insurance amount is $250,000 per share owner, per insured credit union, for each account ownership category.

Although they offer many of the same products and services as other financial institutions, credit unions have some distinguishing characteristics that make them unique. 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".

Fees tend to be lower, and there are plenty of ATMS and traditional services and they have the BEST service (at least the two I belong to). My credit union also offers great educational seminars about investing, retirement, home ownership and lots of other topics.

There are lots of employers that offer their employees credit union membership, but there are also plenty of credit unions that allow individuals to join. In my case, I used to work for the State of NC and joined the NC State Employee Credit Union at that time. They were great, but don't offer small business accounts, so when I later started a small business, I joined the Coastal Federal Credit Union and opened a business account. I really can't say enough good things about both credits unions. It's also nice to know that the employees I see at the credit union are working for a fair employer not a dirty rat-bastard greedy empire.

Most importantly joining a credit union deprives the big bank of your business. I suspect a mass exodus to credit union could really make a difference and eventually force regular banks to become better actors in our politics and economy or at minimum force traditional banks to provide better service and more reasonable fees.

I'm no expert on the intricacies of banking. My recommendation is based primarily on my values and my experience as a member of two credit unions, so please no one get all over me about unacknowledged shortcomings. I'm sure there are some, but I feel pretty darn safe in saying it is a better choice.

Here's the link I mentioned if you'd like more information:

https://mycreditunion.gov/about-credit-unions/credit-union-different-than-a-bank

[Marius25]

1. I recently joined a credit union

Looking to close my regular bank account but haven't moved everything over yet.

[efhmc]

2. Been using the same CU in Houston for over 40 years. Even though I have lived in 2 other places

since.

[Deuxcents]

3. Love my credit union. Have had accounts since I was 25

I’m now 76. I took some good advice when I was young n good thing I did.

[gay texan]

4. I love my credit union!!!!! N/t

[J_William_Ryan]

5. "Fees tend to be lower..."

Or don't exist at all, compared to a bank.

[brooklynite]

6. No objection in principle, but I put my cash in banks with the highest interest rates....

...keeping the balances below $500,000 for a joint account. I don't plan my finances around "sending a message" to Big Finance.

[ret5hd]

9. Of course. None of us expected anything else.

[brooklynite]

11. How much in potential earnings do you set aside to send your message?

Especially in an inflationary period?

[ret5hd]

17. Are you offering to manage my money?

[brooklynite]

18. No, but neither am I suggesting you should refuse extra income from an FDIC insured bank.

The FCU for my wife's agency offers a 0.2% interest rate. Capital One (not a bank I have an account with) is currently offering 3.4%.

FWIW, I'm not banking for mortgages, car loans, overdraft protection or fee reduction. All I need is interest rates for savings.

[CommonHumanity]

14. Got it, but are you sure interest rates at credit union aren't competitive?

Are you sure interest rates at credit unions aren't competitive? Maybe they aren't or maybe it varies significantly among banks and credit unions, I don't know, but do want to mention there is also the option of using a credit union for your short-term financial transactions such as bill paying and checks (if you are a dinosaur like me and still use them) and then using other institutions for investments. Of course, it's a personal calculation so it's just another option in the mix.

[brooklynite]

29. See #18.....

Again, no objection if their rates are competitive, but I'm not going to sacrifice returns for ideological purity.

[SharonClark]

38. I'm a member at 3 credit unions.

Two CUs are offering 4.8% APY for 9-month and 12-month CDs.
No bank in my area, except Capitol One, has a higher rate.

[DURHAM D]

26. My credit union currently has the highest CD rates. nt

[brooklynite]

30. Compared to whom?

[DURHAM D]

32. All the banks.

[wishstar]

36. Credit Union I use has interest rates at 3.5% for 6 month CD up to 4.5% for 3 year CD's

They have had good interest rates for past 15 years or so but they may be the exception since it seems that the majority of credit unions and banks have very low interest by comparison so shopping around on internet is essential to find best rates.

[cilla4progress]

7. We all switched

after the 2008 debacle.

I always prefer a non-profit when I have the choice. I'm very happy with my medical nonprofit, too!

[bucolic_frolic]

8. Penfed

[EYESORE 9001]

10. I've been a credit union member for 50 years now

I’d never go back to commercial banks.

[Raftergirl]

12. Been banking at a credit union for over 30 years.

Also got our mortgage from our CU and they don’t sell them off.

[Duppers]

52. 45yrs here

[catrose]

13. Been with CUs exclusively since 1985. Would recommend.

My child wouldn't believe me at first, because, kids. Now he does and recommends CUs to all his friends.

[hippywife]

15. We've long belonged to a credit union for our savings. However, a word of caution:

Husband's father was a federal judge and belonged to the local iteration of a federal employees CU. Like many CUs, immediate family are qualified to join and so we've had an savings account there many, many years. When the move was on to switch to CUs, we decided to also open two checking accounts with them and things haven't been quite as good as it is with our locally-owned bank.

If I'm out shopping and running errands, if I overdraw my account at the bank with my debit card, transactions show as pending and I have until the end of the NEXT business day to replace the funds. At the credit union, we're immediately hit with a $30 overdraft, even if the transaction(s) are only still pending.

We ended up staying at the bank and went back to using the CU for savings only for the most part. (We haven't closed the checking at the CU, just don't use them except in case of an emergency [like the other night when we had to take the dog to the emergency vet] where I can write a check and have time to move money out of savings to cover it before it hits.)

So, it pays to ask questions first and not assume one is automatically better than the other.

[HAB911]

19. Member since 1978!

[Traildogbob]

20. Great post, great advice

Been with mine since 1985. They are great. Screw big banksters. They are their customers.

[democrank]

21. Really happy with my credit Union here in Vermont

Courteous employees and a real down-home atmosphere

[Hamlette]

22. my gripe is they are not taxed

If we believe in everyone paying their fair share, why shouldn't credit unions be taxed like banks?

It's why banks charge fees. They pay taxes.

File under: no free lunch.

[Kali]

23. banks charge fees not for taxes, but for PROFIT

[Hamlette]

31. but they pay taxes, credit unions don't

[Kali]

33. so what?

they are for-profit companies. credit unions are membership owned non-profits.

[OMGWTF]

24. I love credit unions so much that I belong to three different ones.

Navy Federal CU has the best rates for CDs anywhere. I'm making almost four percent which is unheard of these days.

[GregariousGroundhog]

40. Ally Bank offers 4.5% on 12 month and 5% on 18 month CDs right now

Ally's Savings and Money Market accounts are at 3.6% and 3.8% respectively.

My experience is that online banks have much better savings rates than banks or credit unions that have brick and mortar locations but that local credit unions offer better mortgage terms.

[ananda]

25. Been in one for many years and love it.

...

[AllaN01Bear]

27. many people long ago didnt trust banks and buried their money in the ground via a jar

or hid it under their mattress.

[Cherokee100]

28. I did

I did back in 2008 when the last crash happened. It was a good move for me.

[Kali]

34. of the three around me

I don't qualify for one, one is hyper patriotic somewhat military oriented, and the third that I tried to stay with just sucked. I wish there were more local options.

[jmowreader]

35. I'm going to be a naysayer here

Credit unions work well for a lot of people, but I’ve gotta go out of state often enough I really need a bank with a national presence…sometimes you’ve just got to walk into a branch and talk to a live human face-to-face.

[GregariousGroundhog]

44. I'm with you

My experience is that savings accounts and CD rates are much better at online banks (I use Ally) whereas mortgages rates are most competitive at local credit unions.

My emergency fund is deposited as Ally's No Penalty CD. If I had to renew it today, I would get 4.75%.

[Wounded Bear]

37. Been in one for years. Gave up on banks a long time ago...nt

[lindysalsagal]

39. Did it years ago. Awesome.

[NBachers]

41. Joined up to 1991 and I am free of the nightmares of Chase, Wells Fargo, B of A, etc.

[DownriverDem]

42. I have money

in a credit union. My concern is that is it protected.

[TeamProg]

43. I've got a bunch o'Money in my local Tri-County Credit Union! n/t

[SWBTATTReg]

45. AND...more than likely, you'll know some of the members that actually run the credit union, more

than likely they work for the same businesses you do.

[sybylla]

46. I second this, as a former employee for several types of financial institutions.

I prefer Credit Unions and have all my accounts currently in 3, one of them for 37 years. Credit Unions aren't perfect. I have one in my hometown that's as bad or worse than the local banks and I was deeply disappointed to see it. Many are small, limiting the services they provide. For example, before COVID, only one of them offered online banking. One of them was not able to finance our farm purchase while another was. And the 3rd has great rates for a money market account with a smallish balance that's convenient to my elderly parents if they need extra cash.

Where banks and other financials are products of their board of directors and stockholders, Credit Unions are in it for you. Think of them as a cooperative. You are the owner along with everyone else who is a customer and together you get to have a say in the operations and direction of your institution (at the annual meeting).

Call around and ask about membership requirements. If you qualify (or even if you don't), ask them to direct you to the fee schedule and interest rate schedule on their website. This info should be readily available and comparable between institutions.

[sarcasmo]

47. Yep, same Credit Union for 25 years.

[GoCubsGo]

48. I joined one back in the 1990s, at the first chance I got to do so.

Haven't looked back since.

[WestMichRad]

49. Long time CU member

And just joined a second one last week- they have the best return locally on CDs.

[ProfessorGAC]

50. Already Have

In 1984!
I was on the board of a $100 million community chartered CU from 1995 until 2009.
It's an excellent business model.

[Duppers]

53. Impressive.

[Duppers]

51. Our $ has been in a Credit Union

For the last 45yrs!

[Pinback]

54. CU member for 40+ years and counting

Low fees, good rates on CDs.

Savings & checking interest rates are low, but that’s not the place to stash big amounts of cash anyway.

On edit: The 7 Best Places to Put Your Savings (Investopedia)