“No institution – except the church – does more good for people than credit unions.” -Wright Pattman
Many people are often looking for easy ways to save money, but there is one category that is often overlooked. And that is banking with a credit union versus a traditional bank.
A couple of weeks ago, I participated in the comments of an article written by J. Money over at Budgets Are Sexy. The topic was Top 6 Mindless Money Wasters. The money wasters were general such as convenience stores, cell phone plans, unnecessary bank fees, magazine subscriptions and annual credit card fees.
The answer that J. Money found most interesting from me was in reference to the “unnecessary bank fees”. My answer? “I’m part of a credit union. They pay me to use my money.” He loved the response so much that he actually sent out a tweet about it (see below).
I’ve been banking with a credit union for so long that I guess I’ve taken for granted the benefits of being a member.
I made the switch from a major bank to a credit union when I was in my early 20’s. The fees back then were astronomical (to me). 
I was charged $12 per month ($144 per year) to have a checking account plus a few other fees that I could possibly avoid, but had to be careful. I felt like I was always trying fit inside this little box to avoid being charged additional fees. Keep in mind, I was fresh out of college so I wasn’t exactly bringing home a bucket load of money to start with.
The Eye Opener
My husband (boyfriend at the time) mentioned that he was part of a credit union and that he didn’t have to pay a service charge every month. He went on to say that they actually paid him interest on his money monthly depending on his average daily balance. I was in shock. No service fee AND they paid interest on the funds in the account?
Of course, I wanted to immediately transfer my funds, but he informed me that in order to join, you had to be a family member of a current member. I didn’t have a family member that was a part of his credit union so, I found the next best alternative. A credit union which was part of my mother’s employer.
Their checking account services and fees ($2 per month) weren’t as good as what my husband had, BUT it was better than the $12 I was paying per month to the bank. I immediately transferred my funds from the bank to the credit union (against the advise of my Mom). She was a die-hard bank fan. Me? I hold no loyalties when it comes to my money especially when the service and confidentiality are comparable.
My husband and I married a couple of years later and you can only guess what I did first. Yep, I opened a checking and a savings account with his credit union. At that point, I was able to save the $24 per year ($2 per month) I was paying as a service fee. Laugh if you want, but a savings is a savings, if you ask me.
Have I regretted the switch? Not at all. It’s probably one of the best financial decisions I’ve every made as far as handling my daily finances. And since my credit union is a part of the Credit Union Service Center Network, I can bank with any other credit union within the network (anywhere in the country) – free of charge.
In the End
So if you’re up to doing a some research, you could probably save a few dollars as well earn a little bit of interest by banking with a credit union. Of course, it’s still definitely a matter of personal preference.
So what do you say? Feel free to agree or disagree with my logic in the comments. Share your approach to banking.
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{ 6 comments… read them below or add one }
I’ve been using a credit union for so long I can hardly remember what a regular bank is like. In addition to less fees, I feel like I get more personal service. They also have better rates on home loans. Maybe auto loans too, but it’s been a while since I had one of those. Great article Patrenia.
Same here. The kidding part is…I rarely ever have to visit my credit union. When I do though, yes, the service is exceptional. They have come a long ways and have become a very competitive piece of the banking industry. I love it! Thanks Eric.
Early last year I switched to my local credit union after having some major issues with my bank. Never again will I do business with a bank.
There are so many benefits (not mentioned here) to doing business with a credit union. And most credit unions these days are admitting new members as long as you work or live in the designated area. Happy saving!
Yes, the guidelines for admitting new members are getting more and more lenient which is definitely a good thing. Not to say that I want the entire banking industry to crash, but a little competition has always been a benefit for us as consumers. I’ll take my savings anyday!
Being a former credit union employee I am 100% credit union. They are more flexible, member oriented and much more stable financially then the traditional bank. And because most credit unions are Not for Profit the money goes back into the credit union and not risky investment practices.
Agreed! Both credit unions I’ve been a member of have definitely been very geared towards positive business practices that are beneficial to the members as a whole. They realize that without the members, there would be no credit union. It’s great!