Choosing a new financial institution is an important decision. When examining credit union versus bank benefits and drawbacks, you should consider the security and customer service that each of these financial institutions can offer. Choosing an intuition that provides better security can help keep your money safe in the event of a closure, and good customer service can make banking a more comfortable, stress-free experience.
Will your financial institution protect your finances? Will you be able to get good customer service and access to ATMs when out of town? These are important questions that should be answered before you open an account. Take a look at the last set of advantages of credit unions and commercial banks to determine which financial institution is best for you!
One of the biggest questions that emerge from commercial bank vs credit union debates is: How secure will your finances be with each of these types of institutions?
The Federal Deposit Insurance Corporation (FDIC) is a government agency that insures participating commercial banks, protecting the checking, savings and deposits of that bank’s account holders. If the bank unexpectedly closes or goes bankrupt, the FDIC protects bank member finances up to $250,000 per depositor.
Meanwhile, credit union benefits may include insurance through a different government agency: the National Credit Union Administration (NCUA). Like the FDIC, the NCUA guarantees the finances of account holders by up to $250,000. Like commercial banks, this insurance is used as a safety net in the event of a credit union’s bankruptcy or closure.
Note: Not every commercial bank or credit union is insured by the FDIC or NCUA, respectively.
When considering security in the decision between commercial banks vs credit unions, you must always check with an individual institution to make sure that they are insured – and that your money will be safe.
Excellent customer service is another common advantage of credit unions. Credit unions do not have as many members or profit goals that might otherwise get in the way of providing customers with better, more personal customer service.
That being said, commercial banks typically have more branch offices and more ATMs. This can make it easier for customers who often travel or intend to move in the future to continue to have seamless access to their finances.