Have you ever wondered what the actual benefits of joining a credit union? In the US, there are nearly 7,000 credit unions, with more than 100 million members, according to US News and World Report, so there must be some advantage to opening an account with a credit union such as Coosa Valley Credit Union, instead of a bank.
As it turns out, there are hard facts and figures that back up the claim that credit unions offer more to their members than many other financial institutions. The Georgia Membership Benefits Report, published in December 2015, estimates that credit unions in the state offered their members (more than 2 million statewide) a total of $184,788,010 in direct financial benefits throughout 2015. Those benefits came in the form of lower interest rates on loans, higher rates on accounts and lower fees, compared to banks.
Lower Interest Rates on Loans
The benefits report looked at the average interest rate on loan products offered by George credit unions and compared it to the rates offered by banks. Pretty much across the board, interest rates offered by credit unions were lower.
For example, the average interest rate on a standard credit card offered by a credit union in 2015 was 11.57 percent, compared to 17.36 percent on a card opened with a bank. The average rate on a 60-month car loan from a credit union was 2.69 percent, compared to 3.75 percent from a bank. Credit unions offered average interest rates that were higher than banks for just one type of loan, an unsecured personal loan. In that case, the average from credit unions was 9.33 percent compared to an average of 9.21 percent from banks.
Higher Interest Rates on Savings Accounts
While interest on loans costs you money, interest on savings accounts helps you make money. The higher the interest rate on a savings account, the more you stand to earn. Georgia credit unions had higher average interest rates on a variety of savings accounts, compared to banks, in 2015. For example, the average savings account with a balance of $1,000 earned 0.07 percent interest at a bank, compared to 0.19 percent interest at a credit union. In 2015, Georgia credit union members ended up earning a total benefit of $7,365,907 from general savings accounts.
Members of credit unions also tend to see higher interest rates on retirement accounts. In 2015, IRA accounts at credit unions in Georgia offered an average rate of 0.38 percent, compared to 0.16 percent from a bank.
Lower Fees
Credit union members also paid fewer or lower fees than people who had accounts at banks, according to the Member Benefits Report. If a credit union member had a check bounce due to not sufficient funds, the average amount charged by credit unions was $29.50, compared to $32.18 charged by the average bank in Georgia.
People looking to buy a home in the state also saved money if they got a mortgage from their credit union, instead of a bank. Banks charged an average of $1,361 in closing costs, compared to the average of $1,151 charged by credit unions.
All in all, the average credit union member in Georgia received about $90 in benefits last year, or $171 in benefits if their entire household was a member of a credit union. If you are ready to start having your money do more for you, find out more about the benefits of opening a savings account or applying for a loan with Coosa Valley Credit Union today. We not only offer better average rates than a bank, we also provide a number of conveniences, such as mobile banking and e-billing, to make managing your money even easier.
This report has a lot of valuable information in it. We suggest taking the time to look it over. Remember that Coosa Valley Credit Union is experienced, always nearby and anyone can join.