What Makes Credit Unions Unique?
Unlike big banks, credit unions don’t have customers, they have members. At a credit union, once you become a member, you also become part owner. As a member, you get a personalized experience with a financial institution that truly cares about your finances. This is shown through the care you are met with as soon as you step through the door.
For instance, at most banks, you are seen by the amount of money you have in your account and your credit score. However, at a credit union everyone is treated the same, and you will find that credit unions are generally more flexible with people with lower credit scores; you’ll see that your credit union will even work with you and provide financial advice to help you no matter your financial situation.
As a member, you also get to vote on who will serve on the board of directors. The board members are volunteers, not paid individuals, who decide the direction the credit union will take. No matter how many accounts you have or the amount of money you have deposited, every single member gets an equal voice.
A big misconception about credit unions is that there are strict membership requirements. While this may be true for some that isn’t the case for all. In fact, many credit unions today make joining relatively easy and membership open to essentially anyone.
There are many ways a person can become a member, from sharing a place of work, place of residence, place of worship, or even if you have a family member who is already a member, you can be a member, also. Depending on the credit union, there are dozens of ways to be considered for membership.
Also, credit unions are unique in the sense that they are not-for-profit financial cooperatives. Unlike banks, credit unions pass on profits to the members in the form of better rates and little to no fees on financial services. Having an institution that works towards providing excellent member service and financial services is definitely a huge plus.
Credit Unions vs Big Banks
While credit unions are unique, they share many of the same financial services that big banks offer. From savings accounts to mortgage loans and everything in between, credit unions can offer services to its members at any life stage.
With many reasons to join a credit union, you might wonder why everyone has not switched to a credit union today. The misconception of how one can become a member is a huge factor. A while back, many believed you had to be part of an organization in order to join the credit union. Although some credit unions are segment based (they only serve those belonging to a certain group), that is not the case when a credit union is community based. Several credit unions are opening their membership up so more people can experience the many benefits of membership.
Since credit unions are a not-for-profit financial cooperative, there is a limit on resources for big ticket items such as technology advances and locations. However, if you join a credit union that is well-capitalized, you may not experience these setbacks. (FYI ALLIANCE CU is 15% capitalized and that’s a good thing.)
In contrast to big banks, most credit unions do not have the luxury to be widespread. Usually only limited to a set number of branches and ATM locations within the demographic area of their membership. Although there are some exceptions to this as credit unions have evolved over the years.
To compete with larger banks, most credit unions are involved in a co-op network. This network is made up of many other credit unions across the nation which then allows its members to access ATM’s at locations where other participating credit unions are located.
If you also happen to be looking for more specialized services like multiple credit cards, big banks are able to offer the same services as a credit union, but with many variations of the same products. This could include multiple versions of private loans or multiple credit cards from the same bank.
Your Money Your Choice
In the end, the choice is yours. It’s up to you to do the due diligence and determine what you are wanting from your financial institution. A more personalized experience or a simple order taker. There is something out there for everyone, there is no wrong decision just a right choice for your financial needs. Let us know your financial needs, and we can find out today if a credit union is right for you.