How often do you think about the companies you do business with, particularly your financial institution? You’ve probably known there is a difference between a bank and a credit union, but do you really know the benefits a credit union can offer you? 

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Transcript:

Welcome to Money Tip Tuesday from the Making Money Personal podcast. 

When it comes to banking, most people want a place where they feel their money is secure, and they’ll have access to it whenever they need it. Today, credit unions are rising in popularity due to their unique ability to provide great products coupled with personalized services. 

Your financial institution is more than where you have your checking account. It’s a pivotal part of your financial plan.  

Why wouldn’t you want your financial institution to be your ally? To be a place you can trust with not only your money, but your financial future?  

If you’re listening to this, you’re likely already a credit union member. If you’re not yet, you should seriously consider banking with one. 

Here are some of the top benefits of banking with a credit union.  

The first benefit is that credit unions offer lower loan rates than big banks. Lower rates mean lower payments and credit unions offer lower rates for auto loans, personal loans, mortgages and more. If you’re looking for a way to lower your monthly payments on your loans, consider refinancing with a credit union to free up some cash flow. The other side of this benefit is that credit unions also offer higher deposit rates, so you can earn more interest on your deposits.  

Another benefit is that credit unions don’t charge as many fees. Credit unions are not-for-profit institutions, and they also enjoy certain tax breaks that enable them to put more of the money they make back into their products and services. Because of this, credit unions don’t have to charge hefty fees for accounts and other penalties. Common fees you’d see at a bank like annual account fees, overdraft fees and transaction fees tend to be significantly lower at a credit union if they’re even there at all. 

Perhaps the most unique benefit of banking at a credit union is that you’re a part owner of the institution. Unlike banks, who have customers, credit unions have members (shareholders). Every member owns a part share in the institution and the credit union focuses on keeping those members satisfied. Joining a credit union is a great way to become a part of the institution instead of feeling like just a number. You also get certain opportunities to participate in institutional changes and vote to elect Board members. Try doing that at a big bank! 

Another benefit is that credit unions provide local servicing. If you’re intentional about keeping your money local, you can’t get more local than a credit union. One of the best features of credit unions is that your funds actually help other members in the community. When you deposit money into an account, that money is combined with other members’ funds which are then used to lend to other members who need them. It’s a great way to be a contributing part of your community and to help others who need it. Local service is better service because you’ll build relationships with people who care about you and that relationship gives you the ability to work with the institution if you need help or assistance with any of your accounts or loan payments.  

Credit unions are known for their community involvement. They are highly focused on giving back to their communities. It’s a cornerstone of their philosophy regarding service. They work to improve their communities, make regular donations to nonprofits, and support local events. The Credit Union National Association also known as CUNA shares on their website that, “From the biggest cities to the smallest towns, credit unions put our me