Show #285 Airing Sunday, February 20, 2005
It’s time to give credit where credit is due. Credit unions offer many benefits that most people just don’t know about. Here to share the in-credible reasons for joining one is Jan Thomas, CEO and president of PSE Credit Union.
Question: What is a credit union? How is it structured?
Answer: A credit union is member owned and member run. It has a volunteer Board of Directors.
There are two insurance alternatives for credit unions:
1.) Federal: Federally-chartered credit unions and half of Ohio's state-chartered credit unions are insured by the National Credit Union Share Insurance Fund, backed by the credit of the U.S. government. The fund that insures credit union deposits is run on a "pay-as-you-go" system, so losses cannot build up. This fund, like the FDIC, insures each account up to $100. It is so secure that it has never had to use taxpayers' money.
2.) Private - American Share Insurance: Nearly half of Ohio's state-chartered credit unions are privately insured by American Share Insurance (ASI), the nation's largest private provider of deposit insurance. Unlike federal insurance that provides $100 of coverage on a per-member basis, ASI insures each account a member may have in an insured credit union up to $250,000. Providers of private share insurance are supervised and regulated by the Ohio Department of Insurance and the Ohio Department of Commerce's Division of Financial Institutions.
Question: Can you give us an example of how a credit union might be a good alternative?
Answer:
- Better savings rates: 6 months CD pays 2.1%, compared to 1.2-1.8%.
- Lower loan rates: car loan 2.99% comparted to 5.9% from bank.
- Lower credit card rates: 9.99% vs. 13.5%. If you pay your credit card every month, no balance, then go with the bank card that gives points/miles/gifts. But if you carry a balance, go with the lower rates on credit union cards.
Question: Can anyone join a credit union?
Answer: Members of a credit union share some kind of common bond, such as working for the same employer, belonging to the same organization, or living in the same community. Each credit union's "field of membership" is defined in its charter.
For example, anyone who works, worships, resides or goes to school in Cuyahoga County can join our credit union. Other counties have their own.
Question: is there a fee to join?
Answer: Ours is $5, and you get that back when you leave.
Question: How can someone who is interested find one?
Answer: Go online at www.creditoption.com.
Question: If you want to learn more about credit unions to decide what is the best financial decision for you, what can you do?
Answer: Members can be educated through newsletters, educational programs, and partnerships, such as the one we have with Lineweaver Financial Group.
Could a credit union be right for you? To find out, give PSE Credit Union a call. You’ll not only earn extra credit, but you may save money, too. My thanks to Jan Thomas, a “credit” to her profession.
