Are Credit Unions a Safe Place for Money?

Posted by Credit Union of Texas on July 28th, 2017

Building a nest egg for the future is smart. Savings accounts can help people gradually build up a surplus to help them buy a car or home, pay for college or even prepare for retirement. Ensuring the money put away for a rainy day is safe, however, is wise. While most people are familiar with the built-in safeguards traditional banks have to offer thanks to FDIC insurance, they may wonder if their money is just as safe if deposited in a credit union.

The answer to this question is a resounding yes. Credit unions are governed by the National Credit Union Administration and offer their  members access to the same level of security that traditional banks  provide. NCUA membership provides credit unions the ability to insure deposits up to 0,000 – the same amount covered by the FDIC. That means credit union members do enjoy the same level of security and protection banks provide if the unthinkable happens to an institution’s assets. Going beyond NCUA deposit insurance, credit union members are also likely to enjoy other benefits that make credit unions a sound one for those hoping to build up their savings. Here are just a few of the unique ways credit unions can help their members save for the future:

• By offering lower entry points – Credit unions often allow members to open accounts with very low initial deposits. A deposit as small as , for example, may open the door to begin regular savings while providing all the benefits of credit union membership.
• By offering higher interest payouts – Credit union members often enjoy higher interest rates on their savings. This is because credit unions’ profits are channeled back to individual members instead of to their shareholders. That means money saved is likely to earn more over the long run.
• By charging lower fees – The cost of doing business with a credit union tends to be much lower. From lower service fees to other perks, credit union customers are often able to hang on to more of their hard-earned dollars.

Credit unions tend to be more service focused than traditional banking counterparts. These distinctions, however, do not mean that members give up security in the process. Thanks to the NCUA, credit union members often enjoy the same level of protection that banking customers are afforded, with benefits that go beyond the norm.

About Author

Serving our community since 1931, CUTX is owned by its members and operated in accordance with the laws governing credit unions in the State of Texas. As a member, your deposits are federally insured by the National Credit Union Administration, a United States government agency.