Credit union

At a credit union, an eligible account holder joins as a member rather than remaining only a customer. Deposits may be called shares, and a checking account may be called a share draft account. Member ownership does not guarantee a lower loan rate, a higher savings rate, or fewer fees. You still compare the account's terms, access, and insurance with the alternatives.

In a sentence

• "I keep $2,000 in checking and $8,000 in savings at my credit union."
• "The credit union is member-owned, unlike the stockholder-owned bank I also use."
• "Before joining the credit union, I check its membership requirements and deposit insurance."

How it works

A US credit union's field of membership defines who is eligible to join. Opening an account involves checking that eligibility as well as the account's own requirements.

1. Check the membership criteria. Eligibility may come through an employer, an association, a geographic community, or a family connection, depending on the credit union's rules.
2. Establish membership. This commonly involves opening a share account and keeping the credit union's required minimum deposit in it; check the institution's terms.
3. Choose the products you need. Membership does not automatically qualify you for a loan, and account features vary by institution.

Not for profit describes the institution's structure, not a promise that every service is free. A credit union can earn a surplus and use it to support operations, reserves, and member services.

An example

You qualify for membership and move $10,000 from another institution into a credit union. Assume this credit union requires you to keep a $20 membership share within your savings account, and the move incurs no fees.

The $20 membership share is already inside the $8,000 savings balance, leaving $7,980 above that assumed minimum. Do not add the share again as an extra asset or subtract it as a fee; your total deposits are still $10,000.

Why it matters

Choosing a credit union requires two separate checks: whether you can join and whether its products fit your needs. Compare fees, minimum balances, branch and ATM access, transfer timing, and rates rather than treating the ownership structure as a recommendation.

A low advertised loan rate does not tell you whether you qualify for it. A higher savings rate also needs to be weighed against balance requirements and how readily you can access the money.

Credit union versus bank

A credit union is member-owned and operates not for profit; a bank may be stockholder-owned or mutually owned. Both can offer a checking account for everyday payments and a savings account for money you keep aside, so the institution type alone does not establish which account works better for you.

Deposit insurance uses different federal systems. FDIC insurance protects covered deposits at insured banks, while federal credit union share insurance is administered by the National Credit Union Administration (NCUA).

Common questions

Can anyone join a credit union? Not necessarily. You must meet that credit union's membership criteria, which can be broad or narrow. Check the eligibility requirements before comparing account-opening offers; an attractive account is not an option unless you qualify to join.

Are credit unions federally insured? All federal credit unions carry federal share insurance; state-chartered credit unions may have federal or private insurance. The standard federal share-insurance limit is $250,000 per share owner, per federally insured credit union, for each account ownership category. Two accounts in the same ownership category at one credit union do not each receive a separate limit, so verify both the institution's insurance and how your accounts are grouped.

Are credit unions always cheaper than banks? No. Compare the specific account or loan, including fees, rates, minimum balances, and access costs. Member ownership does not settle that comparison, and an institution can offer a competitive savings account without offering the best loan terms for you.

Is the membership share a fee? Not by itself. A required share deposit remains part of your account balance; separate membership or account fees are charges. Check the credit union's minimum-balance and account-closing terms before treating the entire deposit as available to withdraw.

Go deeper

• How to track a small bank or credit union that isn't supported covers search checks and manual tracking when a connection is unavailable.
• How to switch bank accounts without missing a bill walks through moving deposits and payments before closing the old account.
• Savings goal calculator works out monthly contributions for a target and date, with account interest included.

Where it shows up in Zypper

If your credit union does not appear in Zypper's connection search, try its full legal name, an abbreviation, or its parent company's name; Bank not listed explains the checks. An unsupported account can be tracked as a manual account, with a balance you update yourself that still counts toward net worth. You can choose whether to include it in your budget; get started with Zypper to track it alongside your other accounts.