From the outside, there doesn’t appear to be much of a difference between a bank and a credit union. Both offer savings accounts, checking accounts, loans and other financial products to help you achieve your financial goals. They have lobbies, drive-up windows, and ATMs.
But once you know a little more, the differences between banks and credit unions become clear.
Banks have been around for hundreds of years – the oldest existing bank in the world is located in Italy and has been operating since 1472. Credit unions, on the other hand, are relatively recent. The first credit union in the U.S. was founded in Manchester, New Hampshire, in 1908. That year, Congress passed the Federal Credit Union Act, enabling the creation of credit unions across the country.
Over the 100 plus years since the first credit union was founded, some things have changed. Others have not. Here’s something that hasn’t changed: Banks are for-profit organizations, owned by investors who are highly motivated by bank profits. Nearly everything a bank does is driven by the need to make a profit large enough to keep investors happy. Credit unions, on the other hand, are member-owned, non-profit organizations. Any profit the credit union makes is returned to members in the form of lower interest rates on loans; higher interest rates on deposits; community involvement; and other services not typically seen from a bank.
The University of Kentucky Federal Credit Union was founded 81 years ago as a local, community partner. As such, UKFCU gives back to the community by helping those in Central Kentucky and surrounding areas. For example, UKFCU donates school supplies to central Kentucky schools; works with the University of Kentucky’s Markey Cancer Center and Dance Blue to raise funds for cancer research and treatment; provides support to the Bluegrass Chapter of the American Red Cross; is involved in the afterschool program of the Lyric Theater and Cultural Arts Center; and provides free financial education to members and the community to help them achieve their goals.
Walk into any UKFCU office, and you’ll notice immediately that there is something fundamentally different about a credit union: from the teller behind the desk, to the branch manager and the loan officer, everyone is there to serve you!
You might think that a credit union would be limited in the financial products it could provide to its members. That belief would be incorrect! UKFCU is proud to offer its members:
• Completely free checking accounts – no minimum balance and no service fees
• Higher interest rates on deposits
• Lower interest rates on loans
• Visa Signature, Visa Platinum and Visa Business credit cards with perks such as CU rewards, extended warranty on purchased items; emergency money if your card is stolen; travel insurance; and auto rental collision damage waiver.
• Access to your money at over 65,000 ATMs nationwide – without fees
• Mobile and online banking
• Google Pay, Apple Pay and Visa Checkout for enrolled UKFCU accounts
In partnership with CUSO Financial Services, UKFCU offers full-service investment services and a wide array of investment products, including mutual funds, fixed and variable annuities, stocks, bond and life insurance. UKFCU can help you with pre- and post-retirement planning, investment strategies, long-term care insurance, and 403(b) and 401(k) guidance and management.
Need some help learning how to manage your finances? Members can take advantage of our partnership with Trinity Debt Management to assist its members with money management, credit and housing issues. And Googolplex offers age-appropriate (and interesting) information for children and teens to help them learn about money, life and much more.
Sound like UKFCU has a lot going on for you and the community? They DO! And you can be a part of it. Stop by any of our six locations, give us a call at (859) 264-4200 or visit us online at ukfcu.org to get started.
Discover the Credit Union Difference at University of Kentucky Federal Credit Union