10 Facts About Credit Unions

Being a member of a credit union is a coup for your finances for many reasons. Here are a few facts that show how a credit union is a great option.

  1. President Franklin D. Roosevelt signed the Federal Credit Union Act in 1934 to promote thriftiness and prevent usury (lending at unreasonably high rates) during the Great Depression.
  2. Credit unions are insured by the federal government. Most are insured by the National Credit Union Administration (NCUA), which provides essentially the same coverage on funds as the FDIC. City CU is federally insured by NCUA.
  3. Eligibility is fairly flexible at most credit unions. Most require residency in a certain community, city or state, or eligibility through your employer or career. Most requirements are pretty broad, making eligibility a possibility for almost anyone.
  4. Credit unions are not-for-profit institutions and are owned by the people they serve (their Members), not by a few shareholders.
  5. Credit unions can offer better rates on savings accounts, lower interest rates on loans and little or no fees on accounts because they are exempt from federal taxes. Credit unions still pay state taxes.
  6. The credit union’s board of directors, which is elected by members, can set loan limits in an effort to help the credit union grow.
  7. Credit union members have democratic control of the credit union and can attend and participate in regular and special membership meetings.
  8. Nonmembers benefit from credit unions, too. Competition for low rates keeps banks’ fees in check, thereby benefiting nonmembers.
  9. With more than 5,000 credit unions across the globe and access to tens of thousands of ATMs, credit unions are increasingly convenient on a national scale.
  10. Once you are a member of a credit union, you stay a member for as long as you maintain your deposit account, whether you continue to meet the original eligibility requirements.