Credit Unions: 5 things everyone should know about credit unions
We continue to get questions about credit unions and although a google search may resolve many of these questions it leaves many more people wondering what are the important things they need to know before deciding to make the switch. If you aren’t one of the 94 million credit union members then it might be something to consider as part of your financial portfolio. In fact, joining a credit union is much easier today. You can join through employment, where you live or work and places of worship. You can even join if you’re related to an existing member.
Credit unions are “like banks only better.” Of course some community and regional banks are comparable but credit unions put members first. Read more about thedifferences between credit unions and banks.
Here are some interesting facts you may not know about credit unions:
1. In 1934, President Roosevelt signed into law the Federal Credit Union Act. This established credit unions as an alternative to banks to promote thrift and prevent usury during the Great Depression. Many credit unions have decades of history with members spanning generations.
2. Credit unions are not-for-profit financial cooperatives. Like other not-for-profit organization, credit unions enjoy federal tax exemptions allowing them to offer better rates on savings accounts, lower rates on loans and little or no fees. Credit unions enjoy this benefit because they are mutually operated without profit. Credit unions do pay other types of taxes such as state, sales and payroll taxes.
3. There are over 7000 credit unions in the United States. The numbers are decreasing each year as consolidations and mergers take place. In some parts of the country, credit unions are physically visible having multiple branches in a city while others are still tucked away in corporate and manufacturing buildings. The vast majority of people can join a credit union and find one that meets their financial needs.Find a credit union to join.
4. Credit unions are convenient. The myth is that credit unions are junior varsity (JV) and can’t directly compete with the convenience offered by banks. Many credit unions have partnered together to form a network called, the CU Service Center (aka shared branching, sister branches, partner branches) giving you access to over 5,000 credit unions worldwide. Find a credit union that participates. If ATMs are what you need, its good to know that many credit unions are part of an ATM network. Those who belong to the CO-OP network connects members to more than 30,000 ATMS (some credit unions join additional networks extending their reach up to 65,000 ATMs). Many of the places you can access your cash are ATMs in 7-11, Costco and Walgreens. Find a CO-OP ATM. Many credit unions also offer 24 hour access through online banking, mobile banking with deposit features, 24 hour call centers and text and email alerts.
5. Once a member, always a member. I’ve found that many credit union members who join through an affiliation think they need to close their membership once they’ve ended the job or left a group. That is not the case. Once a member of a credit union you are always a member. This means you can continue to take advantage of the benefits offered through membership. Additionally, you can have your immediate family members, domestic partners and those living as an economic unit in your household join your credit union.
If you aren’t convince about credit unions just yet, ask other Phroogies (your family, friends and coworkers) about credit unions and share your thoughts with us here or onFacebook.
Ready to find a credit union to join?
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