4 Reasons Credit Unions Are Better Than Banks
If “too big to fail” feels too big to trust, as far as you’re concerned, you’ll be reassured by knowing that choosing a credit union instead of a bank opens the door to a more meaningful banking experience. When you use a credit union for your financial needs, you are participating in a not-for-profit cooperative owned and operated by its membership.
You gain more than a philosophical advantage by using a credit union. The benefits filter down to your bottom line with more affordable services, better rates, and more personal customer service.
1. No more business as usual. The “too big to fail” financial institutions got fat on economic policies and practices that don’t make sense for their customers; for those banks, it’s all about performing for their stockholders. Because credit unions are not beholden to stockholders, they’re free to set the bar higher with standards their members can stand behind—the same members who also happen to be their customers.
2. Pay less in interest, earn more on principal. Another great benefit of the not-for-profit business model: you save money on interest and earn a higher rate of return on your savings. Sound too good to be true? Check the average rates from the National Credit Union Administration and compare banking rates against credit union rates. Discounting the inevitable outliers, credit unions generally outperform banks when it comes to making your money work hard for you.
3. Plug the drain of constant bank fees. Because credit unions don’t have to show a profit at the end of the year, they’re not forced to pelt you with service fees, maintenance fees, penalties, and other niggling costs. Sure, you’ll still see a few basic fees on your statement that cover the cost of doing business, but credit unions don’t have to scavenge for every last penny because they’re not in business to make a profit.
4. Relax and enjoy real customer service. Even the largest credit unions are smaller than the monster banks that keep you on interminable hold for even the most basic customer service needs. Stick with your credit union long enough, and you’re more likely to meet familiar faces and build relationships than you would at a sprawling, impersonal institution. Less stress and less time spent crawling through voice mail systems—isn’t that an advantage worth banking on?
Why not make this coming year the year you begin enjoying the benefits of credit union membership? Make the switch from a bank to a credit union and join PenFed to enjoy less stressful, more rewarding banking in 2015.