Who owns a credit union?
Most financial institutions are owned by stockholders, who own a part of the institution and intend on making money from their investment. A credit union doesn't operate in that manner. Rather, each credit union member owns one "share" of the organization. The user of credit union services is also an owner, and is even entitled to vote on important issues, such as the election of member representatives to serve on the board of directors.
How did credit unions start?
The first credit union cooperatives started in Germany over a century ago. Today, credit unions are found everywhere in the world. The credit union movement started in this country in Manchester, New Hampshire. There, the St. Mary's Cooperative Credit Association, a church-affiliated credit union, opened its doors in 1909. Today, one in every three Americans is a credit union member.
What is the purpose of a credit union?
The primary purpose in furthering their goal of service is to encourage members to save money. Another purpose is to offer loans to members. In fact, credit unions have traditionally made loans to people of ordinary means. Credit unions can charge lower rates for loans (as well as pay higher dividends on savings) because they are not-for-profit cooperatives. Rather than paying profits to stockholders, credit unions return earnings to members in the form of dividends or improved services.
Are savings deposits insured?
Yes. Share accounts in federally insured credit unions (like TrueCore) are insured up to $250,000.00--just as with FDIC coverage at banks. Generally, if a credit union member has more than one individual account in the same insured credit union, those accounts are added together and are insured up to $250,000.00.
However, shares maintained in different legal ownership capacities may each be separately insured, which means that you may be able to keep substantially more funds at the credit union--conveniently and safely--and still have every dollar protected by federal insurance. Stop by or call the credit union today to maximize your NCUA insurance coverage.
Who can join a credit union?
A credit union exists to serve a specific group of people, such as a group of employees or the members of a professional or religious group. This is called a "field of membership." The field of membership may include where they reside, where they work, or their membership in a social or economic group.