Thanks to rule changes that have loosened membership rules and opened the doors to more small businesses, more business owners now qualify to join a credit union (CU). Yet public perception of what credit unions are, what they offer and who can do business there is foggy at best. Credit unions work much like banks. Basically, CUs provide the same services but charge less for loans, pay more on savings and have far fewer fees. When you open an account you become a “member.” That’s why they talk about “joining” a credit union rather than simply opening an account at one.
And while you have to be “eligible” in some way to join a CU, there dozens of ways that can happen simply by living in a certain area, working at a certain business, attending a certain place of worship, or belonging to an organization. The biggest attraction is better rates and lower fees. Anything the credit union makes in “profit” is passed onto members (that’s you) through higher rates on savings, lower fees, and lower rates on loans.
Each credit union serves what’s called their “field of membership” – that’s the commonality between the members. You may be eligible to join a credit union based on your:
- Geographic Location: Many credit unions serve anyone that lives in a particular geographic area
- Family: Most credit unions allow members’ families to join. So if someone in your family is already a member of a credit union, you may be eligible too.
- Membership in a group: This includes churches, school s, alumni associations, and homeowners’ association.
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About the Author: Daniel Kehrer, Founder and Chief Content Officer of BizBest Media, is a senior-level leader in digital media, content development and online marketing with special expertise in startups, SMB, social media and generating traffic, engagement and leads. He holds an MBA from UCLA/Anderson and is a passionate entrepreneur (started 4 businesses), syndicated columnist, blogger, thought leader and author of 7 business and financial books.