Deciding between a credit union and a bank can seem difficult. They both provide a wide range of financial services for both businesses and personal use. However, there are several benefits to using a credit union instead of a bank.
This article is going to cover nine ways in which a credit union is a better choice than a traditional bank. Continue reading to find out some of the benefits that can be achieved by making the switch.
1- Credit Unions Generally Offer Better Credit Card Rates
In general, credit unions typically offer better rates on their credit cards. Bankrate even mentions this as being one of the main benefits of switching to a credit union. If you have a high-interest credit card you are considering consolidating with another card, then a credit union may offer an excellent solution.
2- Accounts Usually Come With Fewer Stipulations
In general, most account types at credit unions have fewer stipulations than their bank competitors. This includes things like account maintenance fees, minimum balances, direct deposit requirements, and more.
3- Credit Unions Offer A Sense of Belonging
Credit unions are comprised of groups of people who share a common element. Membership can be based on a variety of factors like employment sector, geographical area, membership in a group, and more. This can be comforting knowing that fellow members are just like you.
4- You Have A Say In Your Credit Union
Credit unions are owned by their members. Just for having an account, you have a right to participate in votes that determine which members are elected as leaders. This means you can help have a say in the way your credit union operates. More on how a credit union operates can be found here.
5- Higher Savings Rates Are Possible
Since credit unions are non-profit, they can generally offer a better rate of return on their members’ savings accounts, according to Abri Credit Union. This makes them an optimum choice for a variety of savings accounts.
6- Know That You Are Investing In Yourself
Another big advantage credit unions have over traditional banks is that they are built to ensure member success. Any revenue generated by the credit union is reinvested back into the bank in the form of improved rates and reduced fees.
This approach generally results in members that are more satisfied with their credit union as opposed to traditional banks. It helps to create a positive atmosphere knowing that your money is truly at work for you rather than someone else.
7- A Connection To The Community
Many times, credit unions are involved with many local groups and organizations. This makes them a great choice for those who are looking for ways to ensure their financial institution is working to improve the community it serves.
8- Flexible Loan Standards
Credit unions generally have more flexible standards when it comes to lending. They are concerned with ensuring that their members succeed financially and that the credit union continues to grow. This is great for those who are looking to build credit for the first time.
9- Superior Customer Service
Credit unions are generally comprised of smaller groups of people in a certain service area. This approach generally leads itself to a much more personable customer service experience. Many times, members are on a first-name basis with many of the employees at their local branches.
Making the switch to a credit union has many perks. They generally offer better savings rates, have accounts with lower fees, and offer excellent customer service. The biggest difference though is ultimately in how credit unions do business as opposed to banks.
Credit unions are non-profit and committed to the financial well-being of their members. Any returns are reinvested into the organization and result in things like lower lending rates and fewer account fees. This business approach and their commitment to the communities they serve make credit unions an excellent choice.