Understanding the best place to store your money can be a little tricky.

A piggy bank just won't cut it anymore.

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In the U.S., you have two main options: using a bank or a credit union, to help make your financial life easier.

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Smart Money

While banks and credit unions are both places to store and access your money, so what's the difference?

Understanding which one is best for you will help you maximize your money.

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Banks: Pros

Banks are for-profit and some are large national companies, while others are state or regionally based.

Banks are easy to join and use.

They have more financial options, more branches, more ATMs, and more digital services.

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Banks: Cons

Banks usually have more minimum balance fees, overdraft fees, and even some sneaky hidden fees.

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Credit Unions: Pros

Credit Unions are nonprofit, cooperatively owned, and locally based.

This means credit unions usually get you a better deal on savings rates, lower loan interest, and less fees.

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Credit Unions: Cons

Credit Unions often have entry requirements for joining like being of the same faith, job, or community.

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Also, credit unions usually have fewer branches, ATMs, and digital services (e.g. a less user friendly app).

Quiz

Emma is a college student in her hometown who doesn't travel much and really needs to be careful with her spending. Where is the best place for her to open an account?

Know The Differences

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Summary

Look into the specific options where you are living, but know that you have a choice.

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This Byte has been authored by

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Sam Schmoker

International Educator | Academic Advisor