Anyone can belong to a credit union, just not the same one. It's about fit. Unlike banks, credit unions are organized by a common bond, whether it's where you work, worship or live.
"We are owned by our members, not by stockholders, and our board of directors is made up of volunteers who receive no payment for their stewardship of our members' finances," says Suzanne Dusch, vice president of CFE Federal Credit Union in Lake Mary, Fla.
According to the Credit Union National Association, or CUNA, 7,351 credit unions existed in the United States at the end of 2011. When you're narrowing your choices, you'll need some guidelines on what you can expect from a credit union checking account.
Here are some tips on what to look for in a credit union.
Convenience means different things to different people, depending on their habits, says Bonnie Doolin, chief operating officer for the Massachusetts Credit Union League in Marlborough, Mass.
"I recommend that a credit union branch be on the flight path of where you conduct your day-to-day business," Doolin says. "Whether that's on your way to work, where you shop, where you worship or in your neighborhood doesn't matter."
Even if you conduct all your checking account business remotely, before deciding on a credit union, you should at least make an initial in-person visit to a branch.
If you travel frequently, you'll want to choose a credit union that subscribes to shared branching so that wherever you go, you'll be able to access your money.
"Shared branching makes small credit unions seem infinitely larger because you can get the same service at any member credit union that you do from your regular one," says Bruce McClary, spokesman for ClearPoint Credit Counseling Solutions in Seattle.
Shared branching refers to a network of credit unions nationally that share information so credit union members can have thousands of convenient locations to conduct transactions.
You can use their ATMs without incurring a fee and even make transactions and withdraw cash from ATMs in 7-Eleven stores. A teller in another credit union can pull up your account and help you with your transaction, McClary says.
"This is what's gotten me through a recent move without having to switch credit unions," McClary says.
McClary says educational opportunities are abundant. Topics covered include basic budgeting, dealing with debt problems, investing, credit scores, buying a car and housing issues.
"Seminars are offered on site, at other local venues and can be conducted online as webinars, too," says McClary. "And they are free to members."
Many credit unions have programs to coach you through saving, reducing debt, saving for short-term and intermediate goals, and investing for retirement, says Shay Olivarria, author of "10 Things College Students Need to Know About Money."
"Not only will they help you get where you want to be, you'll understand how you got there and why it's important to stay there," Olivarria says.
Credit union employees may conduct the seminars or seek the assistance of a credit counseling agency.
Not all consumers are looking for advanced technology tied to their checking accounts, but many are. Some credit unions have the same technology as big banks and will send a text message to your cell phone when your checking balance is low so you can transfer money to your account. There are also apps for your iPhone, Olivarria says.
"Google the credit union you're interested in and see what they have to offer in the way of technological advances. See if they have a Facebook page," says Olivarria.
Also, do they offer online bill paying, direct deposit and online statements? And can you take one of their education courses online?
Make sure your potential credit union has the services you need.
As a whole, credit unions have shown more stability than banks, says McClary.
"Even though, in general, credit unions are smaller than banks, stability is not relevant to size," McClary says.
Credit unions have a stronger relationship with their customers, which makes a good case for credit unions staying in business.
Ask how long your credit union has been up and running and how it manages investments, and verify that it is growing responsibly.
"Measured growth is a sign of stability and profitability," says McClary. "They shouldn't be branching out so quickly that they can't effectively service the customers they have."
"You're starting a new relationship, so you should find someone you feel comfortable with," says Olivarria. "If the person you're talking with isn't listening to you and answering your questions, don't give them your money."
Beware of a credit union representative who tries to rush you into signing up for an account. They should take time to explain everything to you.
"Make sure you understand the fees and when they will be assessed," Olivarria says.
Credit union representatives should want to partner with you so you'll get the most out of your money. They also can be more forgiving and waive fees that banks won't.
Identity theft and bank fraud are all over the news these days. You'll want to make sure the credit union you select does everything it can to prevent unauthorized access to your personal information.
"The type of online security protection varies between financial institutions, and some of that security isn't even visible to the consumer," says Terri Stonebraker, vice president of Bellco Credit Union in Greenwood Village, Colo.
Besides a user's name, PIN and password, Bellco has a biometric security layer that tracks the way the member types his or her login credentials. "If someone steals your login information, they won't be able to type it just like you do," Stonebraker says.
Make sure your credit union has a policy about how it contacts you. Financial institutions shouldn't e-mail customers and ask them for their passwords, credit card numbers or other sensitive information.
"Low- or no-minimum-balance checking accounts are abundant among credit unions," says Dusch. "Affordable pricing on checking accounts is a hallmark of the credit union movement."
The typical credit union offers a free checking account or provides several options to help customers avoid a monthly fee, Dusch says. For example, a member can keep a specified minimum balance in a savings account, have an auto loan at that credit union or opt for direct deposit of his or her payroll check to avoid a monthly fee.
Still, federal regulations such as restrictions on courtesy overdraft fees continue to impact credit unions, and could put pressure on them to eventually end free checking.
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