March 24, 2008

ele:REVIEW – Credit Union vs. Banks

Where Should You Put Your Money? > via Katya Slivinskaya

What’s the difference between banks and credit unions? Banks are owned by investors who expect a profit. Credit unions are owned by their members. As a member, you get to:
>> Vote for your board members (who also come from the member pool).
>> Receive, in the form of dividends, an equal share of any surplus earnings.
>> Credit Unions are local, so a greater percentage of your money stays in, and benefits, your community.
>> Loan rates are usually lower than those of a bank.
>> Credit Unions boast little to no transaction fees, often offer a higher interest rate on the money you deposit and a lower rate on the money you borrow.
>> Credit unions are nonprofit. Banks are for-profit, publicly-traded companies that are owned by the stockholders (who vote). There is no joining fee at banks.
>> Credit unions are usually smaller than banks, may not have as many branches or ATMs, and may not offer the variety of services that banks offer. But many credit unions belong to a network of credit unions, so members can use the services of other credit union branches and ATMs.

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