The days of free checking, unlimited ATM use and no annual fee bank credit cards are on the way out. It does not matter if you are a good customer or you're a hope-and-pray depositor (You hope and pray you can get to the bank before the payment is processed).
Credit Image: edenpictures on Flickr
All accounts, including student, senior and that little secret account for a rainy day are going to be affected. Not knowing your bank’s fees and service charges can be costly.
Banks have to let you know what the fees and service charges are relating to your account. You might have to spend time digging into their web sites or getting a magnifier glass to read the three point type of legalese that came with your statement in January.
There are more financial services options than a check cashing store or a bank.
Have You Thought About a Credit Union?
Mia Neidhardt does a good job of explaining the differences between the two institutions.
I like the video, but to be fair there are for-profit banks that make contributions to local communities and charities. There are banks that provide good customer service but that might have to do more with the branch manager than the philosophy of the bank.
Another option are small community-based banks that honor the relationship with their customers. If you don’t have a community bank near you, then a credit union can be a good alternative.
5 Reasons to Switch to a Credit Union
Most full-feature credit unions have the same products and services of a traditional bank, such as ATM access, online bill payments and financial calculators. Some of the credit unions will reimburse ATM fees if you have to go to a non-network ATM.
You can earn higher rates on your deposits at a credit union than you will at your bank.
Make no mistake, the bank does use the money in your accounts to make loans and generate income. That is the nature of the being a bank. What is not acceptable is not being fairly compensated with interest for the use of your money.
How is that nickel worth of interest payments working out for you?
Your funds as federally insured up to $250,000 per account by the National Credit Union Share Insurance Fund (NCUSIF). There are state chartered and federal credit unions. You want to make sure the one you join is NCUSIF insured.
Credit union profits go back to members via higher interest rates on savings, access to loans or to provide accounts features like an IRA, 401K or long-term care insurance.
Should you happen to need a loan, you might find it easier to obtain one from a credit union than from your bank. No, they won’t just give you a loan because you asked for one, but they would be willing to talk with you about it.
So I Just Walk In and Sign Up?
Not exactly. You have to qualify to be a member. That can be as easy as living, working or going to school in a certain area of town. Or being a court reporter, ditch digger or related to one. It depends on the type of credit union; you are more likely to qualify than not qualify.
On The National Credit Union Administration (NCUA) Find A Credit Union page, you can search by state, by ZIP code or the type of desired membership. This site gives a lot of information about a specific credit union, but you don’t get to see all the possible locations that are available.
When you are ready to relocate, review the Move Your Money Checklist so that you can transfer your funds in a safe and non-punitive manner.
You don’t have to take higher fees and bad service. Consider making a change.
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