Every financial crisis comes with its share of conspiracy theories and false news. There’s a misconception that credit unions aren’t as safe as banks, and, sadly, it’s something people continue to believe.
This can cause people to take drastic measures, such as removing all their money from their savings (and sometimes their 401(k) plans) and putting it somewhere they think is better, like their mattress.
This isn’t a good idea. No matter how afraid you are of a recession, the fact is that credit unions are the best places you can store your money and they provide incentives you won’t get if you hide your money in your mattress.
Credit Unions are Insured
The best reason to put your money in a credit union or bank is simple — they’re insured. In the case of credit union accounts, assets are covered by the National Credit Union Administration or the Federal Deposit Insurance Corporation, which is backed by the U.S. government.
What exactly does this insurance policy guarantee? You have insurance if there is a failure of the credit union. RMLEFCU is covered by the FDIC. The FDIC is liable for taking stock of bank assets and selling them in order to settle its debts. This covers compensation for bank deposits, and deposits in excess of the $250,000 insurance limit if needed.
Credit Unions and Banks Pay Interest
When you keep your money in your savings account, the money is going to gain interest. That interest is what a financial institution is paying you to keep your money with it. Though you’re not going to get rich off interest, you’re probably going to get more cashback from your savings account than your mattress.
Online Payments Are More Common
Nowadays, most people aren’t using cash or checks to make payments and person-to-person mobile payments are becoming increasingly common, particularly among young adults.
Like it or not, cashless transactions will always be here. When you combine this with the fact that physical money can easily be infected with bacteria and viruses, it’s not hard to see how cashless transactions are more commonplace than ever before. However, if you want to use cashless transactions, you would need to have a checking account to process mobile payments.
Keep Your Money Safe with RMLEFCU
When the world is going through a recession and markets are uncertain, wanting to feel like your money is secure is only normal, particularly considering how many banks collapsed during the Great Recession. However, financial services are by far a better option than squirreling the money away. Want more information? Reach out to us. We’re here to help.