No catch really. CUs tend to have little to no fees and offer far better customer experiences than big banks. They're great for almost everyone. Just watch out for any fees, but you may not see much.

>Is there some kind of catch?

No, they're non profits.

That said, their technology may be quite behind the times.

Some banks may be 'worse' due to greed, but some credit unions can be bad due to a lack of proper board or regulatory oversight

I recently switched to a credit union and honestly have no clue how regular banks stay in bussiness. Amazing customer service and great interest rates on everything.

Credit Unions differ from other banks in that they are owned by the shareholders (account holders, aka you if you are a member). They don’t report to a corporate overlord that demands a quarterly dividend and good stock performance. So most of the time their costs are low. My experience with big normal banks and CUs is that I get better service at a CU and their loan rates are usually less.

Not all CUs are awesome, but in general they are good.

Okay thank you! I will keep this in mind

I’d recommend SoFi banking instead of a credit union as their rates are currently 3.75% on saving and 2.5% on checking when you set up direct deposit. Most checking accounts are 0.01% so their 2.5% is subject to change as they gain market share.

Look into nerdwallet and see how the best ones compare.

Credit Unions are genuinely great. They are structured where you are a "member" instead of a "customer". Many credit unions also have everything you need in terms of products and value.

I think credit unions are better for everyone. I will never go back to a big bank. There is no point.

Good to know. I think I just might check one near me out. Thanks for the comment!

Big banks do have 1 advantage over credit unions

My bank has a 7 state if not more footprint My CU is like 6 counties

For purposes of "a place to keep your money", there is very little practical difference. Both types of institution provide checking / savings accounts, both insure your deposited money against bank failure (though through different agencies), both tend to offer loans and other financial services, etc.

The main underlying difference is who "owns" the institution. Those owners want a return on what they put into it. A bank is often part of a publicly traded company, so it's owned by the various people (or institutions) who have bought shares in that company. A smaller bank might be privately owned by a few individuals.

But a credit union is owned by its members: everyone who has an account with them. So the "return" those members get can be through things like lower / no account fees, higher savings interest (though still smaller than you'd get through an online HYSA), lower rates on loans, etc.

Since account holders are owners, you tend to get better treatment at a CU. As a bank customer, you're ultimately a commodity and might get treated as such.

One drawback to a credit union can be (though not always) that as a smaller institution it may have things like the latest online technology for things like bill payment. And a credit union may have particular criteria you have to meet in order to join: live in a given city, go to a given school, member of armed services, etc. Both of those are much less of an issue nowadays, but was a quirk with my own CU 10-15 years ago.

TL/DR: you'd likely get as good (and usually better) services for lower cost at a credit union compared to a bank. Just look for "NCUA insured" (a CU's equivalent of FDIC for banks), though I don't imagine uninsured CUs would be that common.

Regular banks make money from investments and loans. Regular checking/savings are just a bonus feature to stay feature competitive. They could care less if a checking customer left

They could care less if a checking customer left

Fair.

To be clear, I dont think my old bank is missingmy money lol. I understand that most banks dont make money off of people whonare just using checking accounts etc....but for many people thats pretty much the only way they interact with a bank.

Im just saying it doesnt make sense to me why anyone would go out of their way to take out a loan or open a checking or savings account with a regular bank.

Convenience i guess. One stop shop. Usually is never the best rate or service