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What’s the difference between banking with a regular bank and credit union?

What’s the difference between banking with a regular bank and credit union?

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I was suggested to get a savings and checking account at a credit union, and there is one in my city called American’s first credit union. My question is, what is the difference between banking at a regular bank and a credit union?

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Posted by (Questions: 6, Answers: 6)
Asked on October 17, 2023 9:52 am
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Differences Between Credit Unions and Banks

If you're considering opening a savings and checking account, you may have been suggested to explore options at a credit union. One such credit union in your city is American's First Credit Union. But what sets credit unions apart from regular banks? Let's explore the key differences:

Ownership and Structure:

  • Credit Union: Credit unions are not-for-profit financial institutions owned and operated by their members.
  • Regular Bank: Traditional banks are for-profit institutions owned by shareholders or investors.

Customer-Member Relationship:

  • Credit Union: Credit unions often emphasize a more member-centric approach to banking.
  • Regular Bank: Traditional banks serve customers, and their primary goal is to generate profits for shareholders.

Account Costs and Fees:

  • Credit Union: Credit unions often offer lower fees and better interest rates on savings and loans than traditional banks.
  • Regular Bank: Banks may charge higher fees for various services, and interest rates on savings accounts or loans may be less competitive.

Branch and ATM Accessibility:

  • Credit Union: Credit unions typically have a smaller branch and ATM network compared to larger banks.
  • Regular Bank: Traditional banks often have a broader network of branches and ATMs.

Service Quality and Personalization:

  • Credit Union: Credit unions are often praised for their personalized service and the ability to work closely with members.
  • Regular Bank: The service quality at banks can vary widely.

Technology and Online Services:

  • Credit Union: Credit unions may offer online and mobile banking services.
  • Regular Bank: Larger banks often have more advanced online and mobile banking platforms.

Insurance and Regulation:

  • Credit Union: Deposits in credit unions are typically insured up to $250,000 per account by the National Credit Union Administration (NCUA).
  • Regular Bank: Deposits in banks are insured up to $250,000 per account by the Federal Deposit Insurance Corporation (FDIC).

When deciding between a credit union like American's First Credit Union and a regular bank, consider your specific financial needs, preferences, and priorities.

It's also a good idea to compare the specific products and services offered by the credit union to those of regular banks in your area to make an informed decision.

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Posted by (Questions: 6, Answers: 6)
Answered on October 17, 2023 9:57 am