As more Americans have become frustrated with their large, corporate banks, many have been moving their business to credit unions. Credit unions offer some amazing benefits and could be a great resource for many people.
What is a Credit Union?
A credit union is a financial institution that is owned by its customers as a co-op. Each member votes on board members and major changes to the institution. They are not for profit companies and are generally consumer focused, with little or no business offerings.
Because they are cooperative owned financial institutions, they generally charge low fees and have competitive interest rates for loan and credit accounts. I joined my first credit union when I purchased my first car because it had better auto loan rates.
How to Find a Credit Union
Most credit unions have restricted membership requirements. My credit union started as an organization for public employees. I was able to join because my father had an account and worked at the local Chamber of Commerce. It is now open to all Colorado residents.
Some credit unions only take employees of certain companies. Some only take residents of a defined geographic area. Others are open to anyone.
To find a credit union, start by talking to your company’s HR department. If they do not have any ideas, there are a few good resources to find a good fit for your needs:
CU Lookup – Maintained by the National Association of Federal Credit Unions, the CU Lookup tool allows you to search by location or affiliation.
How to Choose
If you find more than one credit union that you are eligible to join, take a look at their offerings. Some credit unions offer a short list of account types while others are full service institutions with options for loans and investments.
I wanted a credit union with competitive loan rates, which is why I joined my credit union. If you are looking to use a credit union for your banking needs, make sure you it has a location near home and good ATM access.
Bank or Credit Union?
This is a decision that you have to make for yourself. If you are happy with your bank and are not charged fees for your activity there, there is no reason to go through the hassle of moving. If you are upset with your bank, and large banks in general, and want to make the move, a credit union could be a great fit for you.
Please share your thoughts and experiences with credit unions in the comments.
Image by The Consumerist.