Credit unions are nonprofit institutions created to serve certain groups of people based on their employer, location, association with a certain college, or other factors. When you join a credit union, you become one of the people that control the institution through voting and electing volunteer members of the board of directors. While banks exist to make a profit, credit unions exist to serve a community. Credit unions often offer dividends, better interest rates on loans, and higher interest rates on checking and saving balances.
In some cases you’ll get better customer service at a credit union than you would a bank. although Banks and smaller networks tend to rank well in customer service. While Bank deposits are FDIC-insured up to $250,000 per account, Credit Union deposits are also insured for the same amount by the NCUA.
Best Credit Unions
- Consumers Credit Union
- PenFed
- Navy Federal Credit Union
- Alliant
- Connexus Credit Union
- First Tech Federal Credit Union
Consumers Credit Union
MONTHLY FEES
None
INTEREST RATE ON ACCOUNTS
Up to 4.09% APY on checking account balances if you meet transaction requirements
Consumers Credit Union branches are located in the Chicago area. You can become a member no matter where you live in the United States. Consumers Credit Union has relationships with a network of 1,800 branches where you can get in-person help if necessary.
You can open an account with Consumers Credit Union with just $5. The savings account earns 0.05% APY. Consumers Credit Union Free Rewards Checking accounts pay as much as 4.09% APY with a zero minimum balance. When you make at least 12 monthly debit card purchases and have at least $500 per month worth of electronic transactions you’ll get 2.09% APY on balances under $10,000. Add $500 in Consumer Credit Union credit card purchases each month and your APY gets bumped up to 3.09% of $10,000. Make at least $1,000 per month in Consumers Credit Union credit card purchases plus meet all other requirements to get 4.09% APY on balances up to $10,000.
Consumers Credit Union has a network of 30,000 free ATMs available nationwide. They also refund fees for non-network ATM use if you meet the monthly rewards requirements.
PenFed
MONTHLY FEES
$0 if you have a monthly direct deposit or daily balance of $500 or more
INTEREST RATE ON ACCOUNTS
0.20% APY if daily balances are less than $20,000; 0.40% APY if daily balances are $20,000 to $50,000
You don’t have to be a member of the military to join PenFed Credit Union. They offer an ATM network that includes 85,000 fee-free machines. The access America checking account automatically pays 2% cashback on purchases made with your PenFed Power Cash Rewards Visa Signature card. This card is available to applicants who are serving in the military on active duty, in the reserves, have been honorably discharged, or are retired members of the military.
Navy Federal Credit Union
MONTHLY FEES
None
INTEREST RATE ON ACCOUNTS
Up to 0.05% APY
Navy Federal Credit Union offers membership to anyone in the United States with ties to the Department of Defense, National Guard, or Armed Forces. Free Active Duty Checking participants get $240 per year of ATM fee rebates, early access to military pay when you choose direct deposit, and your balance earns 0.05% APY.
With the Free Easy Checking account you’ll get up to $120 per year of ATM fee rebates and 0.05% APY on your balance. You can earn even more interest with Flagship Checking. With this account there’s no monthly service fee if your average daily balance is more than $1,500 throughout the month. You’ll earn between 0.35% and 0.45% APY on your balance, depending on your average daily balance.
Alliant
MONTHLY FEES
None
INTEREST RATE ON ACCOUNTS
Up to 0.25% APY
When you open a checking account with Alliant Credit Union you’ll earn up to 0.25% APY on your balance if you choose electronic statements and have one monthly electronic deposit to the account. Alliant ATM fee free network includes access to more than 80,000 ATMs. Plus, Alliant will rebate you up to $20 per month in ATM fees if you use an out-of-network ATM machine.
Connexus Credit Union
MONTHLY FEES
No Fees but they have monthly requirements
INTEREST RATE ON ACCOUNTS
Maximum of 1.75% APY on balances held in a checking account up to $25,000
You can join Connexus Credit Union if you are a retiree or employee of a participating group of employers, or if you are associated with Northcentral Technical College in Wausau, Wisconsin. Otherwise, you can simply make a $5 donation to the Connexus Association to gain membership in Connexus Credit Union.
There are no ATM fees and you’ll have access to 54,000 surcharge-free ATMs across the country. Opening a Connexus Checking Account is free. Xtraordinary Checking accounts pay up to 1.75% APY when you use the debit card to make at least 15 purchases or spend $400 with the debit card each month.
First Tech Federal Credit Union
MONTHLY FEES
None
INTEREST RATE ON ACCOUNTS
Maximum of 1.50% if you meet certain criteria
First Tech memberships are available to anyone in the United States who works for the state of Oregon or another participating telecom or high-tech company. You can also get a membership by joining the nonprofit Financial Fitness Association, for an $8 fee.
The credit union is headquartered in California. There are no monthly fees for the Union Dividend Rewards Checking account or Union Carefree Savings account. There are 26 branches where you can bank in-person in the Portland area.
Still have questions about the best credit unions? FAQs
What features should I look for in a credit union?
The best credit unions have free checking and savings accounts that pay higher than average interest rates on your balance. When you bank with a credit union you should get a variety of useful no-fee services, lower interest rates on loans, and help with financial literacy. Credit Unions typically charge lower fees than banks so look for an account that doesn’t charge monthly maintenance fees or minimum balance fees.
If you are working to rebuild your credit, choose a credit union that has a Credit Builder program like a secured line of credit or credit cards to help you boost your scores.
Be sure to check online reviews from current customers. Your credit union should have a reputation for being friendly, offering personal service, and for being easily accessible both online and in-person.
Not every credit union offers cash back rewards credit cards or high interest checking accounts. Don’t be afraid to hold out for a credit union that meets every one of your needs, including a well-developed app that helps you access your accounts on the go.
Can you do everything at a credit union that you can do at a bank?
Yes. The big difference between credit unions and banks is that credit unions are nonprofit organizations that exist to serve a community of people. Credit Unions offer the same type of accounts as Banks, including checking accounts savings accounts the opportunity to invest in Certificates of Deposit, health savings accounts (HSA), and credit card accounts.
Credit Unions have online apps to help you manage your money, they accept automatic payroll deposits, and issue debit cards that work at retail locations and at ATMs.
What are some of the reasons to choose a credit union instead of a bank?
Credit Unions may offer more education and help with financial literacy than your average bank. They may be able to hope you understand your credit report and offer tips on how to improve your credit scores. In general, their loan rates may be lower and their interest rates on checking and savings accounts may be higher than banks.
Your credit union may also offer help with debt management through low-interest debt consolidation loans. Many credit unions offer personal finance education courses to help their members learn how to handle money.
Since credit unions are not-for-profit institutions, they may also pay small dividends to their members.
Where should I look for a credit union if none of the options on this list to meet my needs?
The credit unions highlighted here have memberships that are open to anyone who meets their requirements and lives in the United States. Many credit unions only serve customers in their regional area. You may find your perfect Credit Union close to home. Check out your local credit unions and see what they have to offer.
Does every credit union offer fee-free checking accounts?
No; like banks, every credit union sets their own rules and fees for accounts. If having a fee-free account is important to you, be sure to verify that the credit union doesn’t charge monthly fees for checking accounts before you move forward with membership.
Pay attention to ATM fees, as well. While many credit unions have a robust ATM network, others have a smaller number of ATM machines where you can get cash without having to pay a fee. Before you open an account look at the credit union’s website to make sure that there are fee free ATM machines in areas where you live and travel.
Bottom Line
Many credit unions no longer have strict membership requirements, but it’s not hard to find a credit union that you can join. Some of the best credit unions operate all over the country and have a wide network of fee-free ATMs. You should be able to find a credit union that meets all of your financial needs with a little bit of research.
