According to the experts at Bank-rate, both institutions have pros and cons. I will get to that later.
When the uproar surfaced regarding the maltreatment of customers at most big banks, I found myself in a quandary. I knew, I could listen to some of the many pundits in the financial field, and make my decision based on their information. However, that is not my style. In making personal decisions, if possible, I will personally pursue all aspects of a situation prior to making a decision.
As a former investigator in the law enforcement field, I knew, I had to get as many facts as possible, which would enable me to make a comparative analysis. In cases like this, to the best of my ability, I will put all biases aside and approach the situation as if I knew nothing about either institution. I decided to visit one of the big banks first.
My primary objective was to ascertain which institution would benefit me the most. Therefore, I would ask the same questions of both institutions. When I entered the bank, I was asked to sign-in and have a seat. When called upon, I requested an overview of the bank’s policies regarding the various accounts available.
During the course of the session, two words kept coming up, standard and premium. I asked the definition of each. It was conveyed to me, that most standard accounts required some stipulations, which must be adhered to, or one would incur penalties. For example, with a standard account, fees were charged for most additional services, i.e., the purchase of checks, overdraft fees, fees if the amount of money in the account fell below a certain level.
While discussing the premium accounts, it was as if I had been lifted from a world of poverty, and transported to utopia. It became abundantly clear to me, that the system is stacked against the poor man, with no one to advocate for him. For example, with a premium account, no additional fees were required to access any of the aforementioned services in the standard account. One of the prerequisites for the premium account is, one must maintain anywhere from five to ten thousand dollars in some form or the other, be it checking, savings, etc.
When I visited a credit union, I learned, I had much more freedom to use my money without many of the stipulations set forth by the big banks. I must admit, the big bank did offer a variety of ways for one to avoid some fees. For example, direct deposit, having a mortgage, a car note, etc. On the other hand, the premium account holder didn’t have to worry about any of that.
With statistics indicating the rich is getting richer while the financially challenged is becoming poorer, it is obvious that the wealthy is in the driver’s seat. The financially challenged do not own banks, as such, the rich owners are in positions to implement all the rules governing the banking system.
The wealthy continues to make money off the poor. Big banks rely on an assortment of fees to rip off some customers. The wealthy is usually exempt from these fees, because they have enough money to buy into premium accounts.
In our society, who is the most disadvantaged? If you said the rich, you are wrong.
Have you ever heard of some poor person sitting on the board of some large bank? If the answer is no, how will the poor man receive fairness and justice? They are at the mercy of the wealthy and if our aforementioned statistics are correct, the wealthy does not care about the poor.
Bank-rate, Senior Financial Analyst Greg McBride told the wall Street Journal the following. Credit unions very often beat their banking counterparts in terms of offering lower rates on loans and higher rates on deposits.
Large banks have no caps on credit rates. Mr. McBride further asserted, in the final analysis, it is important for customers to shop around, as there is no one size fits all.
With the above information at hand, we will now determine if we should switch from the big banks to the credit unions.
Two of the most important things to remember are, the big banks are for profit institutions. The credits unions are non-profit. A for profit institution is, as the words indicates, as such; they must find ways to make profits.
Since the wealthy are using premium accounts, where do you think a great deal of the bank’s revenue is coming from? The poor, and that is one of the reasons for the on-going wealth disparity.
When the big banks threatened to add fees for the use of the debit cards, who would have been affected the most? If you said the poor, you are correct. If you cannot afford to maintain a premium account, it would behoove you to seek out a credit union.