Credit unions are popular financial institutions that seek to serve their members, rather than earn a profit. Each member of a credit union owns a share of that entity. Furthermore, credit unions tend to offer better savings rates, lower loan rates, and reduced fees. There are certain conditions to be met before you can become a member of a credit union. Now let’s discuss what is needed to become a credit union member and how you can benefit!
Why You Should Join a Credit Union
Here are some of the advantages of joining a credit union – like Riegelwood Federal Credit Union:
- Higher to competitive dividend rates on savings and investment accounts
- Attractive lower rates on loans and credit cards
- Personalized credit assistance
- Accounts are available for all age groups and a variety of financial goals
Becoming a Member of a Credit Union
There are three main ways that you can join a credit union:
- Geographic Location: RFCU offers membership to all of Columbus County, NC, and Northern Brunswick County. If you live, work, worship or attend school in these specific geographic areas we welcome you to open an account. During COVID-19 you must call one of our branch locations to make an appointment to come in and open your new account.
- Family: RFCU encourages members to recommend their loved ones to join the institution. Family members have the same benefits and opportunities as a primary member.
- Special Group Membership: RFCU offers businesses in the geographic locations (described above) to offer RFCU benefits to their employees. This benefit for the business is an added asset to the company’s benefits package. Employees will love our credit union’s personable service and benefits. Businesses may include but are not limited to schools/universities, places of worship, labor unions, or even homeowners’ associations.
Credit Union Membership Requirements
At Riegelwood FCU, if you meet the requirements above, we welcome you to call or make an appointment to come in and open a new account. At the time of opening your account, you must present us with a government photo ID or similar, and make a deposit of $25. This $25 makes you a member of the credit union with access to all the products and services we offer. You can always remain a member as long as you stay in good standing with the credit union. If you decide to close your account after six months, you will receive your full $25 balance back.
Do You Have to Keep a Minimum Account Balance?
Yes, you must keep a membership balance of $25 in your savings account at all times to remain a member of RFCU.
Do Credit Unions Check My Credit Worthiness?
Credit unions are a part of the financial landscape so they may check your credit report when you open a new account. If they do, they will conduct a “soft pull”, which means that although they check your credit, the query doesn’t affect your credit score. RFCU encourages members to use all of our loan services. Yes, RFCU will check your credit score (just like any other financial institution) when you apply for credit. Note, if you have poor credit you may still open a savings account with RFCU as long as you meet the eligibility requirements. You will get access to the financial products and services that you need once you become a member, assuming you qualify for each.
How a Credit Union Can Help You
Traditionally, credit unions had fewer financial products than larger banks, fewer locations/branches, and poor online services. But this is no longer true! Credit unions like Riegelwood Federal Credit Union are competitive in the quality of products and services that they offer to their members. Credit unions tend to offer a more personalized service experience. And credit unions are owned by their members, so all decisions are made in the best interests of all. Joining a credit union can provide access to higher returns on your savings and lower interest rates on loans. These institutions are not as focused on making profits, as they only seek to cover their operating costs. Credit unions also promote financial literacy, as they provide programs on money management for all ages. So joining a credit union can help you to achieve certain key financial goals. RFCU offers credit union services for the students of Acme Delco Elementary School and the Roger Bacon Charter Day School.
How Do Credit Unions Make Money?
You may have wondered how credit unions make money. Credit unions make loans to their members and earn money by charging interest on these loans. They also collect account fees, and then reinvest those funds to earn more profits. Furthermore, as not-for-profit financial institutions, credit unions pay no state or federal taxes. Keeping operating costs down helps RFCU to charge lower interest rates on loans.
Is Your Money Safe in a Credit Union?
Bank accounts are insured by the Federal Deposit Insurance Corporation (FDIC). The FDIC offers up to $250,000 of insurance per depositor, per insured bank for each account ownership category. Did you know that a similar coverage applies to credit unions? It’s true! RFCU is regulated by the National Credit Union Administration (NCUA). That means all funds in such credit unions are covered under the National Credit Union Share Insurance Fund (NCUSIF), which is fully backed by the US government. So individual accounts are insured up to $250,000, making your money safe in federally insured credit unions like Riegelwood FCU.
Banks vs. Credit Unions
Credit unions and banks operate similarly, but they have different goals. When you open a bank account and make a deposit, you become a customer of the bank. But a bank’s primary obligation is to its shareholders, not their customers. When you open an account with a credit union, your deposit represents your part ownership (or shares) in that credit union. So your credit union works in your best interests, because you are a shareholder or an owner of that institution. Banks tend to offer lower interest rates on savings and higher interest rates on loans. But the reverse is true for credit unions. As well, there is a great difference between the interest rate a bank charges on loans and the interest rate the bank pays on savings. This spread is one of the many ways wherein a bank makes its profits. However, as mentioned, credit unions are member-owned. Every depositor in a credit union has a stake in ownership. So when a credit union uses the deposits from you and other members to make loans, as an owner, you benefit from those loans as well. Banks are driven by the profit motive, but credit unions are not-for-profit financial institutions. Therefore, a credit union’s profits above its operating costs and reserves are distributed back to its members with better products and services, along with good returns on savings, lower interest rates on loans, lower fees, and financial literacy for our school partnerships.
Join Riegelwood Federal Credit Union Today!
Now you know what is needed to become a credit union member and how you can benefit from your membership. Riegelwood Federal Credit Union is here to help you achieve your financial goals and wellbeing for both yourself and your family. We have several accounts and programs that are designed with your best interests in mind. Contact us today to discuss how you can become a member of our Riegelwood FCU family.
At Riegelwood Federal Credit Union, we are more than a bank.