Last week the Couple Money Podcast ran an episode about using credit unions for your joint accounts.
Joe Mecca from Coastal Federal Credit Union was the special guest and he took time to answer some questions that people have about credit unions.
If you two are looking for a place to move your money, then you may want to consider adding some local credit unions to your list. You may find that they are a better fit for your financial goals.
What Makes a Credit Union Different?
Credit unions offer many of the same services as a bank – checking, saving, and money market accounts. Members can apply for car and mortgages. So what is the big deal between them?
The main difference with credit unions and banks is how they are structured. Credit unions are not-for-profit cooperatives that serve their members. When you join the credit union, you are part owner.
While a bank may reward shareholders, credit unions return their surplus income to their members in the form of dividends, better interest rates (both with deposits and loans), other benefits.
Bankrate’s 2015 Credit Union Checking Survey found that credit union checking accounts also tended to be cheaper than banks in other areas:
- Lower overdraft fees
- Lower minimum amount to open an account
- Lower fees to use an out-of-network ATM
On top of those lower fees, surveys reveal that credit unions have higher customer satisfaction. My personal experience with credit unions has been fairly positive. One thing that appealed to me was the community feel and the personalized attention.
How Can You Qualify for Membership
While banks can be open to just anyone, credit unions do have a field of membership. Back in the day, many credit unions were based on an employer such as a school system or the state government.
Now there are credit unions based on numerous bonds such as:
- membership in an organization
- geographical location
- group membership – such as a church or school
As you can see it’s expanded to the point that there is probably a credit union that you qualify for in your area. You may also apply to be a member of a credit union if a close relative is already one.
Finding the Right Account for Your Money
Whether it’s a bank or credit union, you want your money at a place where it is not getting drained by ridiculous fees. When you’re looking at credit unions ask questions and see if they can offer a checking account that addresses your needs such as:
When you’re looking at credit unions ask questions and see if they can offer a checking account that addresses your needs such as:
- NCUA insured
- No maintenance fees
- Pretty fast (and free) bill pay system
- Conveniently located ATMs
- Good customer service
I learned from Joe that credit unions that particpate in the Allpoint network gives you access to surcharge free ATMs around the world, a big plus if you travel much. If you want to see if a local credit union can provide what you need, you can use this tool from the National Credit Union Administration
Thoughts on Credit Unions
I’d love to hear from you about your experience with credit unions – good and bad. Feel free to share your thoughts in the comments. How many of you are members of a credit union? What kind of service do you get?
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