So what is actually better? A credit union or a big bank?
What I want to talk about today is the two differences between the both, so you can really understand when you’re opening up a checking account, whether you’re going to a local credit union or you’re going to actually go to a big branch bank.
Now, part of this video is really a lot of it’s going to be educational, right?
So we’re going to talk about the differences and then I’m going to give you my opinion. I’ve been with both and I’m kind of a little bit here.
I’m not going to tell you which one that is, but here’s the deal and here are some of the faults of big banks, right?
So when we’re talking about big banks, like you know, Wells Fargo, right? They were sued for $185 million back in 2016. Creating … You guys remember this, it was Wells Fargo, right? They’re creating these fake accounts and they got busted, right?
$185 million. So obviously the trust over the years from these major banks has really diminished.
In fact, what the statistic is from the major banks to the credit unions is actually only 26% of Americans actually trust major banks.
26% of people actually trust a major big bank. On the other hand, 58% of people trust local credit unions.
So let me kind of share with you and I’m going to give you the Reader’s Digest version on this because I could talk on hours about this topic.
But what is the main difference between the two? Number one big banks are institutions where it is for profit. Okay?
So their shareholders that basically are the customers of big banks, right? So they’re going to try to sell you things, different products. It’s a for-profit business.
That’s the main difference between a big bank and a credit union, which is a nonprofit.
Okay. So credit unions being nonprofit don’t have any interest in selling you other products and throwing other things down your throat. Right?
So I’m going to give it a big thumbs up to the credit union side because that is actually members. So actually the member, because it’s a member-owned, it’s a nonprofit.
The members, whether it’s Navy Federal, local credit union, USAA, VyStar, some of these major credit unions, you’re actually part owner of these, right? So that is the biggest difference, right? Is from an operational standpoint.
Let me tell you some things. And what happens is this, so the leftover money on major banks, right?
Because it’s for-profit goes into investments, it goes into risky investments sometimes and then paying out bonuses to some of the high-end executives.
Whereas the leftover dividends from the credit union, any leftover money actually gets dispersed to its members, you guys, who are a part of opening up a checking account and being part of a credit union, which actually goes into lower interest rates, better savings plans and other things like this, right? So it gets spread out.
So any extra money because it’s nonprofit actually gets spread to the community, to the members themselves.
That’s the biggest difference between both. Okay. But here’s the deal, they’re both insured with the FDIC, right?
So either way, $250,000 you’re both covered. So if you’ve got money in the bank that exceeds the $250,000 mark, it doesn’t matter which, if you go with a big bank or a credit union, but they are willing to insure up to 250, so from the standpoint of safety with your money, probably not a big difference. Right.
As far as the fees and the ATM charges and the monthly charges that major banks have, a lot of the credit unions don’t have that.
In fact, most credit unions just don’t have that. Right.
So another big thumbs up to credit unions to keep your fees and your … Because you’re talking about a couple of hundred bucks a month.
You’re talking about, I mean, literally, it could be as low as 15 bucks a month all the way up to a couple hundred a month that you’re saving with a large amount in your bank account going with a credit union versus a major bank.
Now here’s where I’m going to give a thumbs up to a major bank and a major bank, okay, if you’re doing international traveling, if you got a company that’s maybe international, it’s a little tougher if you’re dealing with a local credit union to be able to get loans. Okay.
If you’re international, so a big bank gives a thumbs up on this site that if you are looking to do international wires or international loans or you’ve got business international because the branch is so small with the local credit union, it’s relatively difficult to get a large loan, a line of credit, something like this with a local credit union versus a bank that has much more availability and they’re nationwide.
Okay. Also give you a thumbs up to that big bank side is if you’re somebody who deals with apps a lot, like an app on your phone, the technology package, the tools and things with the major banks are a little bit more user-friendly.
Then they’ve got a little bit more money they can spend into the equipment and the apps and things like this than the local credit union where it’s, you guys know that you go to log in, there are always issues and it’s a little bit shaky in terms of your apps and the tools and stuff that’s offered through the local credit union.
Now, cool thing that a local credit union does is it takes the money also and diversifies into opening up supporting the local community, right?
So the extra money goes into helping out restaurants and helping out some of the local businesses in the area, right?
So that’s really cool that it putting it back into the community to grow the community, to grow our employment rate and things like this.
So again, that’s a huge, huge thing for me. I’m always supporting the local community and I go with the local credit union from the standpoint of being a community leader and ones that put the money back into our society.
Let me give you my opinion though because this is really more important. Now you kind of know the difference, right?
One’s nonprofit, one’s profit, one takes the money, better apps, things like this.
The other one takes money, puts it back into ourselves as members of a credit union they’re diversifying through us, so we do get better interest rates and better loan terms through a local credit union.
Now I’m going to flip back. Here’s where a bigger bank tends to do a little bit better.
Okay. What I found, and this is just in my opinion, a large major bank, typically it’s easier to get credit cards. Okay, so credit cards tend to come a little bit better from the major bank than a credit union.
Credit unions are very … They’re a little bit stick … they’re kind of a little bit of a stickler when it comes to the process that you have to go through to get a credit card.
Whereas a major bank, a big bank, tends to lend a little bit easier. Now, one other trick as well I want to share with you guys.
With a big bank, what we have found is that if you open up a checking account, it’s a little tip for you guys. Open up a checking account.
Okay, we’re going to call Bank of America, Chase tends to be my top two.
Go in, open up a checking account. After you open up a checking account with that bank, come back seven days later and once you’re in the system, apply for their credit card.
Okay? They are relationship banks.
So once you’re in the system, that’s why I say come back a week or so later.
Hey, I just opened up a checking account with you guys. I would love to open up a credit card with you as well. Okay.
Your chances of getting approved doing it this way versus just applying willy nilly online through a Bank of America credit card rewards card dramatically increases.
Okay, so that’s a little tip for you guys to be able to do that. Now, one other side of the union is this.
Loans are much easier in my opinion. Credit union. Okay.
Loans, not credit cards, personal loans, home loans, and car loans.
Okay, so for credit cards, I’m going to go with a major bank for home loans, car loans, and mortgage loans, definitely, I’m going to go with a local credit union. Okay.
Also, the local credit union, when you do get a credit card, it is much easier to get a line increase than through a major bank. Okay?
Don’t know why the rhyme or reason, give you my tips, my opinion on this.
Over the years I’ve taken this information and data.
I wanted to share with you guys, so go back to this video a million times if you need to.
I hope this helped and I hope it finds you well that you can find the difference, but I wanted to share this with you so you know the difference between a major bank and a credit union and really the benefits of both.
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