You have a few options when choosing where to store your cash – a credit union, a traditional bank, or stuffed inside your box spring. We highly recommend you do not do option three. This leaves us with a credit union vs a traditional bank. Which is better? We’ll dissect the differences and let you decide!
What is a Credit Union?
A credit union is a non-profit money organization where members can borrow money from pooled deposits at a lower interest rate than typical banks. Credit unions exist to serve their members rather than maximize corporate profits. They can range from small, volunteer-run organizations to quite large with thousands of members run by a professional board.
Take for example RMLEFCU: Originally founded by the Denver Police Department, RMLEFCU has proudly served law enforcement professionals and their families since 1938. Over the years, we have grown to include a membership of more than 14,000 members and assets in excess of $220 million.
Credit unions offer the same core products that banks offer; checking and savings accounts, home, auto, and personal loans, debit cards, online bill pay, paper checks, certified and cashier’s checks, money orders, and more.
How do Credit Unions Differ from Traditional Banks?
With RMLEFCU, every member is not just a customer, but an owner of the credit union. In fact, member ownership is one of the key differences between credit unions and other financial institutions.
The credit union is 100% owned by its members. The credit union pays operating expenses and sets aside reserves. Earnings are then returned to members as competitive dividend rates on savings, lower rates on loans, and additional services. Dividends are paid from current income and available earnings, after required transfers to reserves at the end of a dividend period.
With traditional banks, investors own banks and banks have a responsibility to make money for them. That might be through legitimate means like loaning money and earning interest or illegitimate means like opening fraudulent accounts. It can also mean earning money by charging customers outrageous fees.
Credit unions exist to serve their members. That means that credit unions often offer better interest rates both on checking and savings accounts and on loans.
How Do You Join a Credit Union?
Anyone can join a credit union! Membership is determined by being a part of a specific community such as profession, college, or membership in an association or organization.
At RMLEFCU, we serve law enforcement officers and their families. Eligibility is open to current or retired employees of the below-listed law enforcement organizations in the state of Colorado, as well as the family of our current members.
- Federal Police Services
- Highway Patrols
- Government Marshals Offices
- Sheriffs and Constables Offices
- Emergency Dispatch Departments
- State Police
- Park Police
- Correctional Facilities
- Transportation Security Agencies
- Division of Gaming Security Officer/Guard (has completed POST)
- Government Criminal Investigation Offices Police Departments
- Drug Enforcement Agencies
- The FBI
Once you’re a member of Rocky Mountain Law Enforcement FCU, you are a member for life, even if you or your family member no longer works in law enforcement.
To establish membership, either open a regular savings account online in minutes or apply in person at your local branch.
If you need help transferring any existing accounts or would like more information on becoming a member at RMLEFCU, please give us a call at (303) 458-6660.