If you have any amount of money, chances are you have a bank account. Having an account with major banks like Chase or Wells Fargo (or smaller, locally owned banks) lets you deposit and withdraw money from bank locations and ATMs around the world. It’s fast, easy, and a whole lot safer than, say, stuffing your money into a mattress.
Yet you don’t have to belong to a bank to enjoy these conveniences. Credit unions serve the same purposes as a bank, but the function a lot differently. In addition to letting you write checks or use ATMs, credit unions also let you (yes, you!) have a say in how their organization runs. Trying doing that at your local Chase!
To get an idea of how credit unions differ from traditional banks, Bobby Lee of 2 Minute Finance put together this amazingly informative video about the two financial institutions. When you realize just how different banks and credit unions are, you might even want to consider taking your business elsewhere.
Unlike banks, credit unions aren’t insured by the FDIC. However, the NCUSIF works in a similar way, and if your credit union is a member, then your deposit will be insured. For more on credit unions and why you might want to switch banks, see our primer on how to do just that.