It’s a question that we’ll face at some time in our lives. Perhaps we moved. Maybe we became disenchanted with the financial institution we have used for years. Or maybe our checking account experienced fraud twice in 30 days. The reasons are less important than the facts. We are choosing a new establishment in which to park wealth. Will we select a bank, or will we become a member of a local credit union? Gildshire investigated the question and found that there are advantages and disadvantages to each. Here is the result of our research.
Credit Union Pros:
With a smaller clientele, credit unions can offer some better deals. Interest rates are higher, while interest rates for car and home loans are generally lower. Also, you may find that credit unions can offer fee schedules that are more forgiving, as well as lower balances required for the waiving of fees.
However, you may discover convenience issues with a credit union. Your C.U. won’t offer the number of ATM’s as you are used to with a major bank. If this fact is a deal-breaker for you and your family, you can stop here. However, it may not turn out to be that cut-and-dried. Many (even most, nowadays) credit unions are part of a cooperative ATM system, so customers won’t experience out-of-network fees as long as they are at a network money machine. Also, just under half of the United States based credit unions offer reimbursement of ATM fees to their members.
Customer Service: Remember when “going to the bank” seemed like an enjoyable person-to-person activity? Did you enjoy that? If you answered “yes” then credit union membership might provide some of that to you again. There is less in the way of automation and more real-life customer service taking place.
Big banking centers with locations all over the place offer a wonderful convenience. For folks who like seeing their own bank throughout the countryside, there is comfort in knowing your financial institution is there for you when you’re on vacation. But the bank pros don’t end there. Banks offer more products as well as multiple product variations. Do you carry a high-balance savings account? In all likelihood, your bank will offer interest rate tiers and a few other specialized ways of keeping you, and your money, happy.
A bank will be quicker to offer high-tech improvements. That means powerful, up-to-date apps for online mobile banking pleasure. Finally, banks are the only viable option if you’re relocating to a foreign country. The bank you know may already have a location where you are going next.
Customer Service: Do you require help to solve an issue or concern? Prepare to spend some time (perhaps quite a bit of time) with a computerized voice. The upside? The service you receive (albeit through a computer interface) is likely to remedy the problem. Also, it is still possible to become friends with one’s banker, and that can lead to a better banking experience. It’s not uncommon for branch managers to increase ATM withdrawal limits for long-time customers.
What is the Verdict?
Shakespeare said it in the words of Hamlet’s Polonius. “Know thyself and to thine own self, be true.” First, understand what you need from your financial institution. Is a mostly impersonal money warehouse okay with you, as long as branches are everywhere, and the interest rates are acceptable? Or, is a partner for the sometimes scary finance world your desire? If so, and you were paying attention, your answer is clear by now.
One last word of caution, however. Settle on your banking personality type, and allow it to guide you to the answer. Don’t let other people’s, “I would NEVER,” or, “I would ONLY” sway you. There are tens of thousands of banks who hire excellent, conscientious employees. Credit unions have equally excellent employees. Your choice is the best choice for you, almost all the time.