Banks. A necessary evil.

But are they?

I’m not suggesting that you keep your cash money in your house. That’s silly. But you don’t have to use a big bank. I don’t know about you, but I got my first real bank account when I started college and I chose US Bank because it had a branch on campus. These were the olden days before online banking was the norm, cash was still a thing, and I didn’t have a car. In other words, I did not spend any time looking at options because convenience was my highest priority.

About eight years later, my wallet was stolen with my checkbook inside. I reported it immediately and closed the account – stopping payment on anything except my rent check that had yet to clear. Well, lo and behold, someone else thought it would be nice to use my checks to pay their rent and that check cleared first (even though it wasn’t on my approved list of transactions). When I tried to get my money back, US Bank told me it was my fault because my checks were not kept at home locked away somewhere safe, despite the fact that I had effectively closed the account prior to the fraudulent check. It was all very absurd and took way too much time and effort to eventually get my money back. Around the same time, they decided to start charging fees for my checking account, which I could avoid if I had a certain number of specific transactions (like direct deposits) but I was quitting my job and frankly didn’t like the concept. I was done with the bank and easily moved my money to a credit union.

There are plenty of reasons to avoid big banks, certainly not limited to poor customer service* or fees. Wells Fargo’s recent scandal (creating unwanted accounts for customers without their permission and then throwing lower level employees under the bus) is just one example. The whole financial crisis might be another. I don’t know. But here’s one you might not have thought about. Banks provide credit to corporations. Some of these investments are probably not questionable, but the Dakota Access Pipeline specifically is being funded by credit from many big banks. I’m not going to get into the details of the pipeline and protests now – that’s a whole other post – but I’m just saying that now is a better time than ever to move your money from a bank to a credit union, especially if you support the Standing Rock water protectors.

But let me make a quick case for credit unions.

Credit unions serve [their] community by providing financial products to their members with the most favorable terms they can afford to offer. Instead of offering accounts to customers and large dividends to a small group of owners, as banks do, credit unions offer small dividends — and discounted loan rates, reduced fees and other benefits — to a large group of members. Credit union members are, in that sense, both customers and owners.  (NerdWallet)

They are safer. Because credit unions aren’t trying to make a profit, they aren’t making risky investments with your money.

You save money and make money. Again, because they aren’t trying to make a profit, most credit unions have lower fees (or none at all) for checking accounts and can offer more competitive loan rates. They also typically have higher checking and savings account interest rates so you can make money even if you don’t have much in your account. Personally, I didn’t make any money in interest when I had checking and savings accounts with a bank. 

Ok, now that I’ve convinced you, how do you choose? If you’re like me, you might delay making changes or decisions because the options require too much research. NerdWallet has an excellent resource on how to choose depending on your priorities. And another on the best credit unions based on those priorities. 

And now that you’ve chosen a credit union, how do you actually move your money? Here’s a step by step guide.

Congratulations and welcome to the Cool Kids Club!

*I should say that the customer service I received in person at the US Bank branches was great. But their customer service policies left much to be desired.

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