Is it better to having a savings account at a credit union or at regular bank?

Question

Is it better to having a savings account at a credit union or at regular bank?

Answer 1

Depends on a couple of things. I'd personally lean to the credit union because I'm in two of them.

1. Interest rate on savings. Which is higher, the CU or the bank you're considering?

2. Fees. Some banks charge fees unless you maintain a certain balance in your account. Credit unions frequently have no fees or much smaller ones.

3. Opening balances. Some banks require more to open an account than a credit union. Most credit unions allow you to open a savings (called a "share" account) with as little as $5.

There are some other advantages to the CU. Their interest rates on loans are frequently lower or at least competitive with the banks. And once you're a member of a CU, you'll find it easier to get a loan (for a vehicle, for example), especially if you're just starting out in life.

I've been a member of a certain CU for nearly 25 years. They started with a focus on the local military community, and I've seen them offer low-interest loans to young military guys and gals to purchase used cars. Without this program, these kids would frequently get victimized by the local used car "gravel" lots that seem to spring up near military installations. These places sell this folks clunkers for inflated prices, then they offer to "tote the note" and finance the vehicle at some usury rate with weekly payments.

I know this is beyond the scope of your question, but I think the CU is the way to go.

Answer 2

Whatever you'll be comfortable with. Just start saving and put something way regardless of the amount. My wife and I  been doing it for 35 years