Credit Unions
Credit unions offer the same services as a commercial bank; services such as ATM cards, savings and checking accounts, mortgages, and CDs. However, credit unions are non-profit organizations so they do not have to pay federal taxes. Because of that, credit unions are usually able to offer you a better interest rate than commercial banks. This usually means higher interest rates on savings accounts and CDs, and lower interest rates on mortgages. If it is a federal credit union, you should always check to make sure that it is FDIC insured so that your money is safe.
People who have accounts at credit unitions are known as members. In fact, their membership in the credit union makes them limited owners in the financial institution.
Do you have to belong to an organization to join a credit union? Yes. You may join through a school, church, or another group. Perhaps your parents are current members of the local credit union. This may enable you to open a savings account there as well. The Credit Union National Association provides instructions on how to find a credit union that you can join.
