If you're looking for an alternative to traditional banks, the best credit unions could be a good choice for you. Unlike with a bank, at a credit union, you're a member - which also makes you an "owner".
As such, credit unions have a reputation for taking care of their customers better, offering solid rates on loans, and not "nickel and dime-ing" their customers with fees.
We break down our favorite credit unions - with a focus on those that are available nationwide. Many credit unions are small, and focus on local customer areas. However, the credit unions below are available nationally, and some even have branches in most major cities.
Promo: Consumers Credit Union. Why? They offer Rewards Checking that pays up to 5.09% APY on your first $10,000! Plus, they don't charge any monthly fees, never have a minimum balance, and reimburse your ATM fees! Open an account at Consumers Credit Union here >>
Note: The savings offers that appear on this site are from companies from which The College Investor receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). The College Investor does not include all savings companies or all savings offers available in the marketplace.
Our Top Best Credit Unions Picks Of 2020
We evaluate credit unions on their annual percentage rate (the interest you receive), the minimum balance requirements, and the terms and conditions of having the account. We also look at their availability, products and services, and more.
1. Consumers Credit Union
Consumers Credit Union is our top pick because of their awesome Rewards Checking Account that offers an amazing interest rate on your checking account.
Right now, you can earn up to 4.09% APY on your checking account for the first $10,000. The account also has no fees, no minimum balances, and reimburses your ATM fees.
Consumers Credit Union also has a solid savings account, and offers a variety of competitive loan products.
Read our full Consumers Credit Union review here.
2. Navy Federal Credit Union
Navy Federal Credit Union is a popular choice for service-members and DOD employees - and for good reason! They offer everything that any major bank offers, but without the fees and gimmicks you find elsewhere. Plus, they have a nationwide footprint of locations - with branches around most DOD facilities.
Navy Federal offers free checking, loans, student loan refinancing (see our Navy Federal student loans review), and even business products like business checking and business savings.
If you're eligible to join Navy Federal, it can be well worth it. That's why we consider them one of the best credit unions.
3. Alliant
Alliant is another well known nation-wide digital credit union - with full service offerings of checking, savings, loans, and more.
They offer a solid High Rate checking account - which earns interest and has no monthly fees or monthly account minimums. They also offer up to $20/mo in ATM rebates, mobile deposit, and more.
Alliant also offers loan products, including credit cards, auto loans, mortgages, and even personal loans.
4. PenFed
PenFed (which stands for Pentagon Federal Credit Union) is another nationwide credit union that originally was focused on military members and their families. However, today you don't have to be in the military to join - and there are multiple ways you can do it.
PenFed offers the full range of products and services - checking, savings, auto loans, mortgages, and PenFed even has student loan refinancing.
PenFed checking also pays interest, has access to a large network of ATMs, and PenFed has physical branches in many locations. The only drawback to PenFed banking is that they do have minimums and fees. For example, their Access America checking requires $500 minimum daily balance, or a monthly direct deposit of at least $500.
5. Connexus
Connexus is one of the largest credit unions in the United States, with over 300,000 members across all 50 states. Like others on this list, they offer high yield checking accounts, savings accounts, and loan products. They are also a solid digital credit union.
They have two levels of checking account - one that is completely free but it doesn't earn interest. Their Xtraodinary Account also doesn't have any monthly fees, but does have some basic requirements (such as $400 in debit card spending or 15 monthly purchase) to earn interest.
Their savings account isn't as competitive as the top high yield savings accounts right now.
They also offer a variety of loan products, such as auto, mortgage, and more.
Best Credit Union And Savings Accounts
These aren't all necessarily credit union products, but if you want the highest yield savings accounts right now, check this out:
Credit Union FAQs
Here are some common credit union questions and answers.
What is the difference between a bank and a credit union?
A credit union is basically a member-owned bank. Banks have specific owners (shareholders or individuals) and customers, while the customers of a credit union are also the owners of the credit union. As such, credit unions have earned a reputation for superior customer service, more flexibility for small businesses, and in some cases, higher interest paid on accounts.
Are credit unions insured?
Yes! Credit unions are insured by the National Credit Union Association (NCUA). This is similar to banks, who are insured by the Federal Deposit Insurance Corporation.
Are credit unions worth it?
They can be – it all depends on what you’re looking for in a financial product. Credit unions typically offer fee-free checking products, low-interest auto loans, mortgages, and more.
What is a credit union membership?
Credit union customers are members – and that membership is restricted to the rules of the credit union. Many credit unions were designed to serve certain groups of individuals (such as the military, teachers, people in a local area). However, some credit unions have broadened their membership opportunities.
How to join a credit union?
Each credit union sets its own membership rules. Some credit unions require you to live in a certain geographic area, work for a certain employer (or type of employer), or be a family member of someone who meets that criteria. Other credit unions allow you to become a member simply by opening an account at their credit union.
Do credit unions have ATMs?
Yes. Most credit unions not only have their own ATMs, but they are part of a network of ATMs called CO-OP. This gives members access to a large nationwide network of ATMs.
Do credit unions pay more interest than banks?
Sometimes. Credit unions are known to pay higher interest than banks on checking accounts. However, the amount of interest is typically limited to lower dollar amounts of deposits (such as on balances below $10,000). When it comes to savings accounts, credit unions can’t really compete with the best online savings accounts available today.
Final Thoughts
A credit union is very similar to a bank, so you really shouldn't think of banks and credit unions as different. What you should be looking for is an account that matches your needs. Whether you need a checking account, savings account, auto loan, mortgage, or other type of financial product, you should look to see if credit unions can meet your needs, while also not charging you excessive fees or having tough requirements to meet.
Robert Farrington is America’s Millennial Money Expert® and America’s Student Loan Debt Expert™, and the founder of The College Investor, a personal finance site dedicated to helping millennials escape student loan debt to start investing and building wealth for the future. You can learn more about him here.
He regularly writes about investing, student loan debt, and general personal finance topics geared towards anyone wanting to earn more, get out of debt, and start building wealth for the future.
He has been quoted in major publications including the New York Times, Washington Post, Fox, ABC, NBC, and more. He is also a regular contributor to Forbes.
Leave a Reply