Personal Finance and Family Finance ideas and articles from an LDS perspective.

Credit Unions

A friend recently asked me what he should look for when selecting a credit union. My first response was to tell him ‘any credit union is better than any bank’ - but at second thought, I realized there are some important criteria that should be considered when looking for a credit union. Here’s my Top 5 Things to Look for in a Credit Union:

1. Stability
Nobody needs to be reminded these days that not every financial institution is as sound as they might seem. Credit unions aren’t any different. The first thing you need to make sure of in the credit union you consider is that they are insured by the NCUA (National Credit Union Administration - a federal agency that insures credit union deposits, among other things). Visit one of their branches or their website, and they’ll have the NCUA logo clearly displayed. If not - run for the hills!

Another important consideration regarding stability is how they’re running the business. What kinds of loans they’re doing, the amount of debt they have, and how well the credit union is performing financially is very important. You want to make sure the CU you’re dealing with today will still be there tomorrow (and not all of today’s CU’s will be!)

Bauer Financial is a well respected firm that rates the stability of credit unions - look up your credit union’s rating here at the Bauer Financial website. You can also find ratings and detailed financial information about your credit union at Bankrate.com.

2. Location
If you like to walk into the branch regularly, location is another key consideration. Make sure they’re accessible. Not only their branches, but their network of ATMs. One downside to some credit unions is limited and sometimes inconvenient locations. That being said, I haven’t walked into my credit union to take care of business in probably over a year. I do all my banking online these days.

You can find a credit union near you at the NCUA website. You can also type in the state you live in followed by ‘credit unions’ in Google and usually find the credit union league website for that state - which will have a detailed list of credit unions in your area.

3. Size
Size matters in two ways. If you’re like the older lady down the road - you’re looking for a small credit union where the guy at the desk knows your name, your dog’s name, and both your shoe sizes. That’s nice sometimes.

However, it’s important to make sure that your credit union is large enough to have all of the services and products you’re looking for. The smaller the credit union, the fewer their offering of services will be. The smaller credit unions are also at risk of being gobbled up in a merger, or crashing when times get tough.

4. Field of Membership
Credit unions, in case you didn’t know, all have required fields of memberships - like a club. For example, some CU’s require you to live in a certain place, work for a certain company, or even be a member of a certain club or religion. Yes! You can find LDS Credit Unions in both Utah and Idaho.

Once you find a CU that is stable, has a location that works for you, and is big enough to fulfill your wildest dreams, make sure you can actually join that credit union.

5. Services
Now that you know you can join the CU - it’s time to look at its services. Consider and compare the things most important to you. What will you use? If you’re young and busy like me- you want online banking, email statements, a checking account with unlimited transactions and no minimum balance required, and no ATM fees. If you have trouble handling your personal finances and planning your budget - look at overdraft protection. If you’re planning on buying soon - check out their loan rates.