I touched on this briefly in my first post with Servus Credit Union, but really what is the difference between a bank and a credit union? We’re all familiar with Canada’s major banks, but credit unions seem smaller and more local, why is that?
Well in this blog post I’ll break it all down for you.
What is a Credit Union?
Credit unions were started to give regular working-class people easy access to the same services as banks. If you were a tradesman or teacher, for instance, it was hard and/or intimidating to get started with a bank. Because of that, groups got together and decided to pool their resources to create credit unions.
Credit unions are financial institutions that are owned by their members. Because of that, it’s possible for you to sit on the board of your local credit union, attend meetings, vote and generally steer the direction of the credit union. This is next to impossible with a major bank.
Additionally, as I mentioned in my first post, credit unions are not-for-profit. That means that, unlike a major bank that is privately owned, profit-driven and publicly traded, credit unions are non-profit and share their profits with members. For Servus customers that comes in the form of their Profit Share® Rewards cash. Generally speaking, the more you bank with them the more you earn.
As an example, for a $300,000 mortgage, you could expect approximately $500 a year in profit share.
Advantages of a credit union
Credit unions offer a range of services just like big banks including chequing and savings accounts, loans, investments and more. Also, because credit unions are driven to provide the best value to their members, members can generally get lower rates on loans, pay fewer (and lower) fees and earn higher rates on savings products than bank customers. Lower fees and interest rates are huge over the life of a loan as big as a mortgage and who doesn’t want higher rates on savings??
With Servus Credit Union, deposits are 100% guaranteed by the Credit Union Deposit Guarantee Corporation. This means the money you put in and the interest it earns is safe and secure no matter what (say a financial crisis hits) – and up to ANY dollar amount.
Getting started with a credit union
Whether for savings, investing, or day-to-day banking getting started with a credit union like Servus is easy – just click here. And if you’re expecting a tax refund this year, there are three great reasons to make the most of your money by investing it!
First, having a plan to invest before your refund arrives means you’ll be less likely to spend it. Second, you can use that money to boost your emergency fund. This last year has taught us how volatile life can be, we should all have an emergency fund if possible. Third, your money is most powerful when it’s working for you by earning interest. Get your money soldiers working hard today and maximize that growth!
Servus Big Share Contest
Time is running out to get your entries in for the Servus Big Share contest! The contest closes April 30 and you can still earn entries by investing your tax refund, transferring savings from another bank, or continuing to save in your account. By helping your money grow you could REALLY help your money grow by winning 1 Million Dollars! Could you imagine??
Leave a Reply