Credit Union Benefits - YouTube

Hello, and welcome to Your Money 2.0. I’m Thomas Fox, Community Outreach Director at

Cambridge Credit Counseling. In our last episode we discussed the overall benefits of using

a credit union versus a bank. If you recall, credit unions are founded on the Seven Cooperative

Principles philosophy. These principles, which include open membership, democratic control,

member economic participation, autonomy, education, cooperation, and concern for the community,

predicate their actions. A credit union's not-for-profit status, and membership driven

philosophy, are reasons enough to consider making a switch. However, you might be surprised

at some of the little things that really make a credit union membership worthwhile.

I recently spoke with Morriss Partee, founder of the Everything CU website for credit union

professionals, and we discussed some fantastic credit union benefits -- some of which I was

not even aware. For instance, many credit unions are part of a large network, called

Shared Branching. If your credit union is a member of a Shared Branching system, you

can use any other credit union in that network as you would your own. You can go in and ask

account questions, cash a check, or just about any other transaction you would at your own

branch. If you're concerned about ATM access, you needn't be. Believe it or not, some credit

union ATM networks are larger than that of America's biggest bank. Your credit union

may even rebate any ATM fees you are charged.

Another difference you’ll find at a credit union is their willingness to help. Remember,

you are a member, not a client. Mr. Partee informed me that many credit unions offer

financial literacy education and personalized budgeting advice. You can work one-on-one

with a professional if you’re looking to solve your family’s budget problems. You

may also be able receive credit guidance if you're turned down for a loan. A representative,

from a participating credit union, can review the reasons your loan application was declined

and help you strategize ways to improve your credit.

Some of you are probably wondering, “Do credit unions offer credit cards?” Credit

unions are full service institutions, and many offer credit cards. You should always

take caution when applying for additional lines of credit, especially if you're having

a difficult time making your bill payments. However, if you're in the market for a credit

card, you would be missing out if you did not shop at a credit union. Granted, you must

be a member of a credit union in order to apply for their credit card products; however,

as a popular slogan notes, membership has its privileges. On average, credit union cards

carry a 12% interest rate. What's fascinating is that the average penalty rate is just shy

of 18%, compared with the penalty interest rate of 29.99% that has become common in the

for-profit banking industry.

There are plenty of reasons to consider using a credit union. Typically, you receive higher

interest rates on savings accounts and certificates of deposit. You'll usually receive more favorable

terms on home and auto loans and credit cards, and you're very likely to save money on checking

account fees. There are also many advantages to using your current bank, or even switching

to a local bank. Every financial decision you make needs to be weighed against the value

you receive in return. You may like the security or convenience of a larger banking institution

and find their fees reasonable. However, many of us are struggling through this difficult

economy, and we should always be on the lookout for money-saving alternatives such as credit

unions and local banks. As a customer, you have choices. It's important to examine these

choices when the terms of the services you've been provided are altered. This is true of

any financial product, be it a credit card, or a checking account. If the new terms are

not to your liking or don't fit comfortably within your budget, shop around.

To find a credit union near you, visit the Credit Union National Association's website

at www.creditunion.coop and select Locate a Credit Union, which is located on the left-hand-side

of the screen. A quick find function will return results based on your selections, and

provide detailed information about the various credit unions in your community, including

membership requirements.

Well, that’s it for this edition. As always, we welcome your feedback and ask for your

thoughts and suggestions by e-mailing us at [email protected]. Thank you

for watching. Until next time, I’m Thomas Fox for Cambridge Credit Counseling.