Joining a Credit Union: Are Credit Unions Less Expensive for Members?
A lot of the time, the idea of joining a credit union comes up as an alternative to opening a bank account or opting for a financial product offered by a bank or credit card company. The reality of the situation is that there are numerous advantages associated with credit unions, and if they suit you then you can greatly improve your financial standing with the help of these institutions.
Is Joining a Credit Union More Profitable?
If you ask financial experts whether joining a credit union or getting a loan or deposit from a bank might be better, many of them will point to credit unions as being superior. While banks do offer a more comprehensive set of services and products, and they are also somewhat more flexible, credit unions are actually much cheaper.
What’s truly great about joining a credit union is you won’t have to deal with the hefty fees and interest rates that a bank would charge you. They offer basically the same financial products as banks – including personal loans, credit cards, mortgage loans and car loans – but the overall fees and rates required when you benefit from these products will be far lower.
So, as soon as you become a member, you will gain access to financial products that can easily rival those that banks can provide. Even though you might have fewer options (for instance, only one type of credit card, as opposed to 5-6), those options will be enough to provide you with the kind of cheap and efficient service that you need.
Why Are Credit Unions So Great?
Joining a Castle Rock credit union is very straightforward. While smaller credit unions might have more restrictions – not just to protect themselves but also to maintain a cohesive and empowered community – many larger state and federal credit unions have actually resulted from the merger of smaller ones. This means their restrictions have lessened, so that they accept a greater diversity of members overall.
The fact that more members are being accepted means that there are more contributors and greater amounts of money available to the union. Since credit unions are nonprofit organizations, all that money goes back to its members with interest, and the only money needed by the union itself will generally consist of operations fees and amounts required to maintain the service or hire tellers.
Banks are subject to federal and income tax, and they tend to reinvest their money multiple times to try to make a profit. While credit unions still need money to operate properly, they don’t use the same business structure. Instead, they operate as a cooperative where the clients themselves are shareholders, and the only profit that the union makes goes to them.
So, if you choose to join a Castle Rock credit union, you won’t simply gain the benefit of a set of financial services that you could easily get from a bank. Aside from lower fees, you also become part of the union’s community and may even be able to influence the organization’s policies.