Shaking Up the Piggy Bank: The Unsung Heroes of Finance – Credit Unions

Alright, let’s get down to it. You’ve probably been doing a lot of money-checking, penny-pinching, and budget-breathing lately. Can’t say I blame you. Times like these can make you question everything, like, where should I keep my hard-earned dough?

Banks are the Andrew Jackson to this story – the common go-to. But what about the cool cousin of banking – credit unions? Those folks who are part of one, yeah, they never seem to stop raving about them. But what’s the big deal, really?

So, What’s the Sitch with Credit Unions?

Mike Schenk, basically the Einstein of credit route economics, works for the Credit Union National Association. According to him, credit unions are a lot like banks when it comes to what’s on offer — we’re talking insured deposits, mobile banking, debit cards and such, your personal finance starter pack.

The REAL difference though? It’s all in the philosophy, baby.

Whereas banks are always about the profit, lining their pockets and making it rain for shareholders, credit unions are about co-operation. Their main concern? Serving their members. Nice, right?

A Walk Down Memory Lane

Picture this: America, the Great Depression. Banks were denying small loans left, right and center. Why? Because it wasn’t worth their time, apparently. So, people began to pool their cash together. Friends helping friends, trust at its finest. Carrie Birkhofer, the big boss of the Bay Federal Credit Union in California, shares this heartwarming tidbit of history.

Fast forward to 1934, and President Franklin D. Roosevelt makes it official with the Federal Credit Union Act. The aim? To offer a national, cooperative system for micro-credit. What a concept, huh?

All in this Together

Aren’t you sometimes bugged by the customer-bank relationship? How about being a “member” instead?

Credit unions treat its customers as such. You’re more than a number; you’re a part-owner of the cooperative! You get a say in electing the directors’ board, and sometimes, you might even receive a dividend payment. Interesting, right?

“We don’t need to please outside shareholders,” Schenk says. “The regular profits? They go back to our member-owners in the form of freebies like lower fees, better savings rates, and friendly loan interest rates.” How about that? Pretty competitive, wouldn’t you say?

Your Friend in Need is Indeed Your Credit Union

Over the years, credit unions have proven time and again that they’ve got their members’ backs. Natural disasters, government shutdowns, or – dare I say it – pandemics… they’ve always been there for their members. Before any regulations or government pleas were issued, credit unions had already stepped up their game. Talk about being proactive!

Join the Club – If You Can

The only problem is, joining one might not be as easy as pie. There are some hoops to jump through – you might need to work in certain industries, live in specific areas, or be linked to a particular employer.

And then there’s the size of these credit unions – they aren’t exactly packing the same sort of punch as the big banks like Wells Fargo or Bank of America. Fewer branches, ATMs, and resources can make things a little trickier, although many take part in shared branch networks.

Worth the Buzz?

If you ask me, credit unions seemingly deserve the hype. They offer the same financial services as banks, with a heart to boot. Plus, who doesn’t like the idea of lower fees and better rates, right?

Go on, give it a try. Explore, dig around a bit, see if you’re eligible for any credit unions, maybe even hop onto yourmoneyfurther.com for some guidance. Your piggy bank might thank you for it!

“We’re basically the best-kept secret in finance,” Birkhofer states. Well folks, the cat’s out of the bag now.

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