I opened my very first bank account when I was seven years old. My father helped me set up a savings account at American Savings Bank and I got a bright red passbook with an eagle on it1. And then American Savings was bought by something else, which was bought by Washington Mutual, which was acquired by Chase. Story of a thousand small banks across the US. And I never switched banks because, well, why bother.
At least, until 2008, when two things happened. The first was that I financed a car, and the local credit union offered me far and away the best rate, as long as I was willing to maintain a membership there. Since that required keeping $25 on deposit, I felt like that wasn’t too much to ask for an interest rate a point lower than anyone else could offer, but I didn’t think about moving my accounts. For a while, I was banking at both Chase and the credit union, and it worked out okay.
And then I got an overseas wire transfer. Like a lot of freelancers, I get a lot of payments through direct wire transfers, rather than checks, especially when it comes to payments coming from international sources. I was appalled to find that Chase wanted to charge me $80 for receiving the wire transfer, plus another $20 “processing fee.” I had a little chat with one of the nice ladies who worked there and she agreed to waive the fees “this time” and I said “Well look, see, the thing is that I get wire transfers all the time and I can’t really have y’all taking $100 for the privilege.” And she shrugged and said something about “company policy.”
My car payment happened to be due, so I walked across the street to the credit union to pay it and I said “Hey, by the way, do you charge to receive wire transfers?”
“To receive? No, why would we do that?”
I asked the teller if, by chance, I could get a list of the credit union’s fees, and she kindly provided one. It was a short list, because the credit union doesn’t really charge fees. And that decided me. Chase had acquired Washington Mutual a few weeks earlier and I was already grumpy. So I marched back across the street and demanded the balance of all my accounts, in cash, and went back to the credit union and said “Set me up with a checking account. Let’s do this thing.”
This was before Move Your Money started getting big, and I didn’t realize that by joining a credit union, I was about to turn into a credit union evangelist. Because here’s the thing, people: I love credit unions.
It's kind of hard not to when you're a member. I love credit unions so much that I tell complete strangers on the Internet that they should run, not walk, to join their local credit unions, because credit unions are just that awesome.
And I’m apparently not alone. When I moved all my banking from Chase, the credit union staff told me that they were getting scores of new accounts. That trend, of a shift from banks to credit unions, has continued going strong. Last month alone, 650,000 people in the United States moved from banks to credit unions.
On Saturday, a day of solidarity for moving money out of corporate banks and into credit unions and local banks garnered national attention. Locally, our credit unions have seen a huge uptick in new accounts since the Occupy protests began.
In short, credit unions are the new black. And you wouldn’t want to be unfashionable, would you?
For me, it’s not just about taking money out of corporate banks that abuse their customers and engage in reckless behaviour and wait for handouts from the government.
It’s notable, though, that credit unions rank particularly low on the list of failed financial institutions in the United States. Their locally based mode of operations makes it easier to administer loans safely and logically, and they’re accountable to their members, the people who bank there, rather than shareholders, the people who want to make a profit off their operations.
Credit unions have been using money intelligently and responsibly while banks fail across the US, which is a pretty darn good reason to be a member.
It’s also about keeping my money local. Living in a rural area, I’m acutely aware of the massive flow of capital into urban areas. Banking locally keeps my money local, and benefits the people around me; the funds I have on account are the basis of car loans for other credit union members, for personal loans, for home refinancing.
I am directly investing in my community, simply because of where I’m keeping my money, which means I get to feel all warm and fuzzy about where I do my banking2.
It doesn’t hurt that all the tellers know me and that the credit union goes above and beyond in a way Chase never did. They’ve accidentally turned off my card a couple of times due to their tighter anti-fraud controls, and they are always immensely apologetic about it and very quick to fix the situation; when I call them I get an actual human being and a resolution to my problem in under five minutes.
When a wire transfer went astray, no less than three separate people worked tirelessly for two weeks, including placing calls to London, to figure out where the hell it had gone, and that was for a comparatively small amount of money. When I notify them that I’m traveling so they know not to freak out when someone’s using my card to buy Ethiopian food in Chicago3, they tell me to have a nice trip. When I walk into my credit union, I feel like a member of the community, and not a cow to be milked.
And I have the pleasant feeling of being able to give Chase the finger every time I head downtown to do my banking.
1. I was really hoping I’d have a picture of this, but apparently my father’s nostalgic stockpile of strange things stops short at banking passbooks for seven year olds.
2. Which is not really an emotion one expects to have at the bank, you know?
3. Y'all, the Ethiopian Diamond is sooooooo gooooood. I'm getting hungry just thinking about it.