However, before you choose one, it is best for you to weigh the pros and cons of each and decide what’s best for you.
Pros of Traditional Banks
When choosing a bank, you have more options which can be great depending on the services you need. There are several types of accounts you can choose from, such as a Roth IRA, checking account, savings account, certificate of deposit, or a trust fund.
It can also be more convenient to go with a traditional bank, as banks are usually spread out across the country. Meaning, you’re able to access your accounts from anywhere no matter where you are. That means you can easily make transfers and deposits, even if you move cross country.
Cons of Traditional Banks
Banks are known for having many fees that can be very pricey. There are fees that you will have to pay if you do not maintain certain balances on your checking and savings accounts.
There are also fees that you will have to pay if you overdraw your account. Additionally, banks operate on a for-profit basis, meaning they are looking to make money off of you.
Pros of Credit Unions
It is easier to open an account with a credit union. Even if you have had issues with bank accounts in the past, you may still be able to open a credit union account.
Credit unions also have fewer fees and lower interest rates on loans and credit cards. Additionally, credit unions can give you resources that will help you reach your financial goals. In fact, there are many credit unions that are geared towards people who have low incomes.
Credit unions are known for their friendly service. People like the fact that they can go to a credit union and not feel like they are just another customer.
Not only that but credit unions are board-run by local members of the community, meaning their interests are often aligned with yours instead of investors looking to make a profit.
Cons of Credit Unions
There are fewer credit unions than banks. That is why it may be harder for you to find one. You must also be a member of the community or a certain organization to join. Furthermore, credit unions do not offer as many financial services as traditional banks do.
Credit unions do not have as many branches as banks do either. If you go outside a certain area, then you may not be able to access your credit union as easily as you would a bank.
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Credit unions and banks are two options that you have for getting your financial needs met. Both of these options have their advantages and disadvantages. You should take the time to weigh all of the pros and cons before you choose one.
Image Credit: bank vs credit union by twenty20.com
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