The first-ever credit union opened in April 1909 in Manchester, New Hampshire. Since then, these lending institutions are only growing in popularity. Between year-end 2019 and Sept 2020, memberships increased by 3.37 million or 2.8% to 125.11 million. In fact, loan portfolios at credit unions rose 6.6% in the 12 months ending in Sept 2020 which is higher than the previous year’s annual rate of 6.5%. There are multiple good reasons why shifting to a credit union from a bank would be a smart financial move.
They are non-profit business structures with a tax-exempt status which ensures affordable fees. Members create policies and take major decisions. You get lower interest rates on loans due to a customer-centric model which is not focused on generating profits for shareholders but creates value for members. Friendliness, accessibility and a democratic structure are other excellent features of credit unions. But there are a few golden rules that you may want to follow before putting your money in a credit union.
1. Check the Facilities Offered
Credit unions come with high-end facilities for a positive experience. Each one might serve a different subset of people or membership field depending upon specific employment or geographical location. It is an extremely viable option and helps ensure a great personalized service. No wonder the market size measured by revenue of the credit union industry is $90.8 billion in 2022. Try to tick off a few common perks like checking accounts, savings accounts, digital banking, share certificates, money market account, vacation and holiday club account and youth club account. Make sure the institution offers MasterCard and Visa Gift Cards along with auto loans, personal loans and home equity loans. Having these in place makes quite a financial sense to shift to a credit union.
2. Digitized Processes
It is one of the convenience factors that add to a quick and comfortable experience. The union must offer online joining facilities via a simple call or email. Further, it must have a robust mobile banking option. This helps you bank from anywhere if you have a secure internet connection. Now members can easily pay bills, receive electronic statements and check balances, transfer funds, schedule bill payments, view e-statements and manage their money without time-consuming complex procedures. The top credit union of New Jersey will also allow electronic deposit of checks from your smartphones. You are able to enjoy secured 24/7 on the go access to all your accounts with a banking app. Check if you can set up auto-payments which helps clear EMIs, utility bills and credit card bills without delays. Below are a few added pros:
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3. Easy Account Access
It is not always possible to get to a branch. So, look for a credit union that will give access to your account at over 30,000 surcharge-free ATMs and 5,000+ shared branches nationwide. The best unions strive to serve people according to where they live, work or worship or any clubs and associations they might belong to. So, it is no surprise that the total number of credit unions in the US grew steadily in the past 8 years and reached more than 126 million in 2020. A reputed union will use a Co-Op financial services network so members can use any ATMs in their network. This gives you better access to your money than any commercial bank. In fact, this facility eases your hassle and keeps you from paying fees.
4. Switch Kit for an Easy Transfer
This can ease the transfer process from a bank to a credit union and reduce the risks of major errors. The kit usually contains all the forms, paperwork and identification requirements. You might have to present this before your old institution. Further, there could be other packages to help you set up your accounts, fill the minimum deposit or pay the bills smoothly and conveniently. All of this can limit the hours spent in the switch and help you to start reaping the benefits of a credit union membership as soon as possible. Further, make sure to list all the payments and withdrawals which need to be changed over to your new account.
The Consumer Financial Protection Bureau suggests getting a written document confirming that your old account has been closed. You can do it either over the phone or in person. Don’t forget to update your credit card providers, cable companies or phone carriers about the shift.