Ah, credit unions. The financial unicorns of the world. They're everywhere, yet nobody seems to know what they are. Are they banks? Are they clubs? Are they some sort of underground cult where everyone whispers about “low loan rates” and “member benefits”? I thought I’d pull back the curtain on the answers I’ve given a handful of queries sent my way over the years; and yes, some of these questions were asked by family and friends. I don’t work for a bank, Mom, I’ve told you this many, many times.
"Wait, it’s not a bank?"
The most common reaction when you mention a credit union is a puzzled squint, followed by, “So, it is a bank? Or it’s not a bank?” No, it’s not a bank. But try explaining that without sounding like a financial hipster.
“It’s like a bank,” you say, “but it’s owned by the members.”
“Oh,” they reply. “So, like Costco?”
Uhhh…kind of? Except you don’t have to buy a pallet of loan applications to get in. Pretty positive on that one.
"Can anyone join or do you have to be in a secret club?"
A secret club? A lot of folks assume you need to pass some kind of financial hazing ritual to join a credit union. “Do I have to be part of a specific group?” they ask, envisioning secret handshakes and decoder rings (actually that would be kind of cool). And while credit unions do have eligibility requirements, they’re often not as strenuous as some have been led to believe. Live in the area? Work in this industry? Have a pulse? Welcome aboard! Well, maybe not the have a pulse part, but that’s generally mandatory for most things in life.
Still, try telling someone you’ve joined a credit union with ease, and every now and then they’ll look at you like you’ve discovered a glitch in the financial matrix. It’s true, I’ve seen the look.
"Do they even have ATMs?"
Another favorite: “But what about ATMs?” As if credit unions are operating out of someone’s basement with a cardboard sign that says, “Cash Only.” Not only do credit unions have ATMs, but many belong to giant shared networks that give you access to tens of thousands of fee-free machines nationwide. That’s more than most banks can boast.
But yeah, whatever, Greg, keep withdrawing $40 from your bank’s ATM and paying $4 for the privilege. I’ll wait.
Still waiting.
"Oh, they’re for poor people, right?"
This one’s a classic, and I have heard it multiple times. People often think credit unions are where you go if you can't “qualify” for a real bank. Like the dollar store of financial institutions. But here’s the truth: Credit unions serve people from all walks of life. In fact, credit unions regularly offer better rates and fewer fees than traditional banks. But explaining this can feel like convincing someone to trade their designer handbag for a sturdy, practical backpack that might even pay for itself one day. (Oh, and the backpack has secret compartments, Aunt Sharon! You’re missing the boat!)
"Is it safe to keep my money there?"
Yes, Tanner, it’s safe. Your money is federally insured, just like it would be at a bank. The National Credit Union Administration (NCUA) makes sure of that. But there’s something about the word “union” that makes people picture a wooden box buried in the backyard. Maybe we should rebrand: “Credit Clubhouse”? “Money Treehouse”? “Union of Marvelous”? Just spit-balling here.
"So…why should I care?"
If you’ve ever tried to sell someone on joining a credit union, you know the look. No, the other look. That glazed-over expression that says, “This sounds like work.” People are creatures of habit. Switching financial institutions feels like trying to leave a bad relationship—you know you’ll be better off, but it’s a hassle.
But here’s the thing: credit unions are worth it. You know it and I know it. They’re not just about holding your money; they’re about helping you grow it (and not in the “buckle up, we're-going-to-charge-you-for-breathing” way banks sometimes do). They’re community-focused, member-owned, and truly want you to succeed financially. Imagine that. Crazy.
The credit union challenge
So, here’s your challenge: find a friend or coworker (yes, I have had credit union employees who still don’t know the difference) who doesn’t know what a credit union is. Tell them about it. Watch as their face contorts into confusion (results may vary). It’s a rite of passage for any credit union member. Just don’t forget to squint back when they finally ask the inevitable: “Okay, but can I still use Venmo?”
Is this thing on?