How Credit Unions Can Boost Your Family’s Finances
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Not happy getting nickeled and dimed by your bank? It may be time to switch. Find out how moving your money to a credit union can save your family big bucks!
Better Banking with a Credit Union?
Having the best checking and savings accounts for your family can be a huge boost for your finances.
I think most – if not all couples – want their hard-earned money in a safe place that treats them with respect and offers services that will help them reach their goals faster.
And more families are finding that their best banking option isn't a bank.
Instead they're choosing credit unions.
In this episode, Joe Mecca from Coastal Federal Credit Union came on the podcast to answer some big questions couples have about credit unions, including:
- how credit unions work
- what unique benefits do they offer you (and your money)
- how you can bank locally with them and still have global access to your stash
If you two are looking for a place to move your money, then take a listen to this episode!
Resources for Better Banking
If you're looking to stay on top of your money, here are some our favorite tools along with some helpful resources!
- Best Budget and Money Apps: Personal Capital, Tiller, Mint
- Free 401(k) Analysis: blooom
- Jumpstart Your Marriage and Your Money
- Coastal Federal Credit Union <- Our bank 😉
- Want a Happier Marriage? Combine Bank Accounts
- Finding the Best Banking and Investing Accounts
- Optimize Your Bank or Credit Union Accounts
- Track These 2 Key Numbers to Master Your Money
How Credit Unions Work to Make and Save You Money
Even though credit unions have been in the United States for over a hundred years, many people are still unfamiliar with them.
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
Joe was kind enough to explain what makes a credit union different and how their services compare with banks.
The biggest difference is really our structure. While banks are shareholder-owned and really exist to be profitable for their shareholders.
Credit unions are cooperatives. So we are completely owned by our members and every person who belongs to a credit union has an equal share and an equal say in how the credit union operates.
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), and 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 through the years has been positive.
One thing that appealed to me was the community feel and personalized attention.
How Can You Qualify for Credit Union 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. [Fun fact: Coastal started of as IBM Raleigh Employees Federal Credit Union!]
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 Best Credit Union 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 participate in the Allpoint network give you access to surcharge-free ATMs around the world, a big plus if you travel.
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.
Support the Podcast!
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Thoughts on Credit Unions
I'd love to hear from you about your experience with credit unions – good and bad.
How many of you are members of a credit union? What kind of service do you get?
This episode was originally released in April 2015. Show notes have been updated in October 2020.
We are part of a credit union, and so far I don’t really see much of a difference between this and a bank.
Thanks Michelle; I agree. I think for many people credit unions offer what they need to keep their family finances organized.
I love credit unions! My local CU offers the best interest in town for savings and checking accounts. Plus the staff is super friendly.
I’ve had some great customer service at credit unions. Even the larger ones seemed more community, customer oriented.
We don’t use credit unions much as our primary method of banking, simply because location favors us using a bank, but we have an account at one and I would not hesitate to use them for an auto loan should one be needed, as their history shows that I would likely get an unbeatable rate there.
Great point about using credit unions for loans! I was just telling my mom this weekend that credit unions can have lower rates and she should check them out.