Friday, January 21, 2011

Up On My Soapbox or NOT the End of Free Checking....

"Ike aku, 'ike mai, kokua aku, kokua mai; pela iho la ka nohana 'ohana "Recognize others, be recognized, help others, be helped; such is a family relationship."

--A Hawaiian proverb as recorded by Mary Kawena Pukui from Verity Credit Union's 2009 Annual Report

As long as we are talking money this week I might as well give you my credit union spiel....

With all the talk of "the end of free checking" and all the new fees that the "big banks" are levying - many times aimed at those who can least afford it - I feel like now is the time to shout from the rooftops: HAVE YOU CONSIDERED A CREDIT UNION?!?!

When I first went to work for Verity Credit Union in March of last year I already had a credit union account, not out of any strongly held personal beliefs, but because that was where my husband had his money before we got married and he felt very strongly about not having his money in a "big bank."

One of the first staff events held after I was hired was the Quarterly Breakfast where the Annual Report from the previous year was unveiled and discussed. 

Like many financial institutions, 2009 had been a precarious year for Verity, but they had come through it pretty well and were going strong and ready to weather whatever changes lay ahead. 

The above quote was on the cover page of the Annual Report and I was both impressed and skeptical. 

Impressed because this kind of attitude was just what I was looking for in both a financial institution and a workplace and skeptical because I have worked at other places which purported to hold certain values, but didn't always live up to their assertions.

Almost one year later I can honestly say that I am still impressed with Verity and the degree to which they (we) live up to what we say we value.

Which brings me to my real point: If you are still banking with one of the "big banks" and you aren't a shareholder, my question is WHY? 

Here are just a few reasons to switch to a credit union instead:

1) Credit Unions are co-ops. You are not a customer, you are a member. It is YOUR credit union and YOUR money

2) Credit Unions are not-for-profit. This doesn't mean that they are not trying to make money, they are, but they are not making money to pay the shareholders, but to pay the members (see #1). All profits go into higher interest rates on deposit accounts and lower interest rates on loans

3) Free Checking. Not only are checking accounts free at most credit unions, you actually earn a bit of interest on the money in your checking account - yes, your CHECKING ACCOUNT. Rates on other deposit accounts are often higher than at the "big banks" as well (see #2).

4) Lower Interest Rates. On all kinds of loans, but especially on credit cards. You are not going to find a 20-25% interest rate on a credit card at a credit union, at least not any that I know of. Current rates for a credit card at Verity are between 8.63 and 17.63% APR. 

5) We're a family. Really. If you become a member and stop into your branch a couple of times a month at least, the staff will start to remember you and will make an effort to get to know you. They will ask you about your job and your kids and they will really want to know. A long-time member of ours died recently and his wife said that Verity was like his "Cheers," he looked forward to going in and seeing everyone he knew. How many people can say THAT about their bank? 

This is not to say that credit unions are perfect. There are fees for certain services (bounced checks, overdraft protections, late payments, etc.), but in most cases these fees are much lower than the big banks and in the case of credit union error there is someone you can talk to directly, someone who knows your history with the credit union and who will listen to you.

What about stability? Are credit unions stable? Most credit unions carry the same level of protection on deposits as the big banks ($250,000) and Verity actually carries an additional $250,000 so your deposits are insured up to $500,000. 

Of course, no financial institution is invincible and these are uncertain times, but I would assert that the big banks are no less vulnerable than the credit unions and small banks. Can you say WaMu?

In the meantime, why not put your money where your values are and check out your local credit union?

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