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Banks are not America’s most popular institution at the moment. Between the swelling Occupy Wall Street protests and plans by some banks to start charging debit card usage fees, the tension in the air is palpable.So if you’re tired of being gouged by the same people that pay their CEOs seven or eight figures, but you’re not the type to sleep in New York City parks, how can you express that frustration?
Perhaps it’s time to switch to a credit union. Credit unions are non-profits, owned collectively by their members, that offer many of the same services that banks do. More and more, credit unions are looking like a viable alternative, with none of the gouging and fine print that many banks use to grab your cash.
So consider moving your money from your current institution, or out from under your mattress, and let’s check out the perks that credit unions offer.
Firstly, as opposed to Bank of America and possibly Wells Fargo, credit unions won’t charge you for using your debit card. In fact, some will pay you for using your card. Randolph Brooks Federal Credit Union in Texas used to pay checking account customers 10 cents per purchase, but recently upped the pay out to 15 cents per purchase, according to MainStreet. A reward credit card may put more money back in your pocket, but there are no strings attached to this deal — just nickels and dimes.
At banks, you’re always getting hit with fees — ATM fees, overdraft fees, etc. Since credit unions aren’t out to make money on you, some will reimburse your ATM fees, and you’ll be notified if you’ve over drafted quickly, so you can rectify the situation, notes MSN. You also only pay overdraft if you’re a repeat offender — a nice change of pace from having to beg for a fee removal over the phone.
Though they may have the connotation of being the kind of thing you do for your brother-in-law, payday loans — small, short-term loans (usually around $500) that are meant to last until the pay check comes in — are pretty popular among banks like BoA and Wells Fargo. In fact, MainStreet reports they make a killing with a 650% interest rate. But North Carolina’s State Employees Credit Union offers payday loans with an interest rate around 12%. Instead of paying hundreds in interest, this union helps you pay off the loan quickly and learn to save at the same time.
If you’re thinking about a mortgage, you may want to consider a credit union. The APR’s at banks and credit unions are nearly identical, says MainStreet, and credit unions will usually wave the 1% origination fee, which could cost you thousands. And they’re no different in their handling of your account if you miss a payment.
Finally, converts to credit unions are happily reporting better customer service than they ever got from their banks. Mike Phinney from Baltimore is one such customer.
“They couldn’t make the simplest decisions without calling the head office … At the credit union, though, it feels like the good, old-fashioned customer service that people long for,” he told MSN.
The trend of leaving a big bank for a credit union is becoming popular, says the News-Journal. Consider the above when deciding where to put your hard earned cash.