Business

The Joy and Pain of Credit Unions

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Recent high-profile failures by “big banking” are causing many financially wary consumers to turn their eyes to the non-profit alternative banks: their local credit unions.

If you are considering a change, here is a list of credit union pros and cons that may help you make a decision.

PRO: Customer Focused
Credit unions are praised for superior service. Because their goal is to provide services to their members (unlike banks, which as businesses are primarily focused on profits) they are more likely to help members in difficult situations.

PRO: Low Rates
A recent study by Pew Charitable Trusts revealed that credit unions charge lower fees, offer higher returns on savings, and provide better terms and lower rates on credit cards and mortgages.

CON: Access
Not everyone can gain access to the credit union of their choice. Membership is restricted by employee groups, military status, or other affiliations. Also, being smaller, credit unions cannot always provide the ATM access or mobile and online services available at larger banks.

CON: Vulnerability
Although they have survived the last several storms, credit unions are often affected by economic slowdowns because their assets are closely tied to the community and/or industry in which they operate.