Credit Union Advice & Articles

The huge difference between a credit union and a big bank is who actually runs the show. Credit unions follow this simple rule: "one member, one vote." That means everyone who has an account - even if you just have five bucks in savings - gets an equal say in what the CU does. Pretty democratic, right?

This whole setup really affects who’s in charge. The board of directors is made up of volunteer members who are voted in by the other members. They usually live right in the community, so they represent what their neighbors (the account holders) actually want, not some far-off stockholders just looking for the biggest possible profit.

Since the leadership is local, they focus a lot on the community. Credit Union often fund local initiatives, they often teach people how to manage their money, and try to make loans that help the local economy and community stay strong. This commitment means they act like a community partner instead of just some large banks that only care about your fees and their profit margins.

Okay, so the most important thing is knowing your cash is safe. For credit unions, that safety net is provided by the National Credit Union Administration (NCUA). They run this thing called the National Credit Union Share Insurance Fund (NCUSIF).

This insurance is basically the same thing as the FDIC insurance that banks use. To put it simply, almost all credit unions insure member deposits up to $250,000 per share owner, per insured credit union, for each account ownership catagory. That is a lot of protection, same as FDIC backed banks.

It means the US government completely backs your funds. This lets members to save and transact with confidince, knowing their money is safe, even if the credit union hits a rough times or fails. Always look for the NCUA insured sign when choosing a Credit Union.

Unlike big banks, credit unions have a "common bond" rule. This rule says who can join and who can'r, usually based on things like where you live, where you work, or some other group you're part of. This keeps the credit union focused on the actual financial needs of its specific member group.

Applying to join is usually easy and you can often do it all online. You'll generally need these things:

• Valid photo identification (like your driver's license).
• Social Security number or other tax identification number.
• Proof that you're eligible for the credit union’s common bond.
• A small first deposit (like $5 to $25) to start a share savings account. This deposit is what actually makes you a member and part owner of the place.

Once you meet the "common bond" and put in that first deposit, you're a full member and can use all their services.