By Hughes Federal Credit Union
If you’ve been exploring ways to pay fewer fees and get more out of your banking, it might be time to consider a credit union. While both credit unions and banks offer similar products and services like checking and savings accounts, loans, and credit cards, there are fundamental distinctions between the two that essentially shape how both financial institutions operate.
What’s the credit union difference?
The key distinction between a credit union and a bank lies in the credit union philosophies of “People helping people” and “Not for profit, not for charity, but for service.” Since its beginning in southern Germany in 1849, credit unions have maintained the purpose of serving their members, not shareholders. Banks are privately owned or publicly traded, which means they’re driven by the need to make a profit. Credit unions, on the other hand, are member-owned, not-for-profit cooperatives that work to put people ahead of any profits.
Which financial institution offers better rates on loans and deposits?
The contrast between for-profit and not-for-profit can be seen in the way banks and credit unions work. Because banks are beholden to shareholders, the need to make a profit will often fall on their customers meaning more fees and less competitive rates on savings accounts. The not-for-profit status of a credit union means that any profit that is made by the credit union is returned to its members in the form of better rates on auto and home loans, higher savings rates, and reduced fees.
What can a credit union do for me that a big bank won’t?
Credit unions are also locally-owned which helps them have a better understanding of the importance of having an interest in the well-being of the people in their community. From generous sponsorships to worthy local organizations to empowering its members through financial education, credit unions give back with an aim of improving the financial lives of the people because ultimately, their success lies in the community it serves.
Do credit unions offer the same access to my money that banks offer?
While banks like to flaunt more locations, some credit unions like Hughes Federal Credit Union actually offer more branches for you to access your funds. Thanks to the CO-OP Shared Branch and ATM Network, members have access to over 5,000 branches from coast to coast.
Similar to banks, credit unions also offer online and mobile banking, allowing you to bank anywhere and on your own schedule.
Ready to make the switch?
If you’re looking to bank at a financial institution where your interests come first and get more out of your money, stop by one of our seven branches or apply online at HughesFCU.org today.