A credit union is similar to a traditional banking institution; however, rather than generating profit, credit unions were created and developed for the benefit of members (people). If this piques your interest, continue on.
If you’re constantly paying random banking fees, receiving poor customer service, and earning interest that doesn’t yield a return, switching from your current bank to a credit union may be one of the best, low-key decisions in your life. Similar services, less aggravation and a more personable experience.
At a credit union, you will never be referred to or seen as “just a customer”; rather you will be a “member.” It is not simply about having a word in your title; it means something more.
Credit unions are NOT for profit; banks exist to maximize their profit for their stockholders. In contrast, credit unions are owned by their members (the people who use their credit union). Therefore, when a credit union is successful, its earnings return to the members as opposed to the stockholders.
When using a credit union, you will benefit from lower costs due to the fact that the cost of doing business is generally lower than that of a bank. A credit union is primarily focused on serving its members, rather than generating profits for shareholders. In contrast, banks are primarily concerned with generating profits for their shareholders.
As a result of the differences between how credit unions and banks operate, the way that profits are distributed to credit union members versus shareholders of a bank is different as well. Thus, the way that a person perceives profit will be different when dealing with a credit union than when dealing with a bank.
When you participate in a credit union, you’re benefitting from your own participation – this is a subtle yet powerful feedback loop.
Are Credit Unions Right for Everyone?
If you value items such as:
- Lower Fees
- Better Interest Rates on Loans
- Being Treated More Like a Person than a Number
Then yes, absolutely go ahead and check out your local credit union. Even if you only switch one account over from the bank to the credit union, you will likely see some positive benefits from making this change.
If you want to leave your bank, you do not have to be mad at them to do so. Sometimes simply having an opportunity to find a credit union that may be less expensive, less stressful, and more of a personal experience than what you currently have at your bank is enough great reason to make the change.
